LAW of Work: Second Edition

THE
LAW of work
Second Edition
David j. Doorey
Copyright © 2020 Emond Montgomery Publications
07/18/2020 - tp-dd95260e-c8ad-11ea-a652-024 (temp temp) - The Law of Work

The Law of Work
Second Edition
David J. Doorey
Toronto, Canada 2020

Copyright © 2020 David Doorey.
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Library and Archives Canada Cataloguing in Publication

Title: The law of work / David Doorey.
Names: Doorey, David J., author.
Description: Second edition. | Includes index. | Revision of: The law of work.—Complete edition—Toronto,
Canada : Emond Publishing, 2017.
Identifiers: Canadiana 20200155784 | ISBN 9781772556186 (softcover)
Subjects: LCSH: Labor laws and legislation—Canada—Textbooks. | LCGFT: Textbooks.
Classification: LCC KE3109 .D66 2020 | LCC KF3320.ZA2 D66 2020 kfmod | DDC 344.7101—dc23

Brief Contents
Contents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . v
Preface . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xxi
About the Author . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xxv
The Law of Work: A Timeline . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xxvii
PART I The Law of Work: Themes, Frameworks,

and Perspectives
Chapter 1 Canadian Law of Work in a Nutshell . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Chapter 2 A Framework for Analyzing the Law of Work . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Chapter 3 Key Perspectives That Shape the Law of Work . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Chapter 4 What Is Employment? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
Selected Cases: Part I . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
PART II The Common Law Regime

Chapter 5 A Brief History of the Common Law Model of Employment . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
Chapter 6 The Job Recruitment and Hiring Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
Chapter 7 The Requirements to Create and Modify an Employment
Contract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
Chapter 8 Expressed Terms of Employment Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113
Chapter 9 Implied and Ancillary Employment Contract Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 133
Chapter 10 Termination by an Employer with “Reasonable Notice” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 153
Chapter 11 Termination by “Frustration” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 169
Chapter 12 Summary Dismissal: Termination for Cause Without Notice . . . . . . . . . . . . . . . . . . . . . . . . . . . 179
Chapter 13 “You Forced Me to Quit!”: The Special Case of Constructive
Dismissal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 201
Chapter 14 Damages in Wrongful Dismissal Lawsuits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 217
Chapter 15 “I Quit!”: Termination of the Employment Contract by the
Employee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 237
Chapter 16 Tort Law and the Employment Relationship . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 247
Selected Cases: Part II . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 265
PART III The Regulatory Regime

Chapter 17 Introduction to the Regulatory Regime . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 271
Chapter 18 Wage Regulation and Pay Equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 285
iii

iv Brief Contents
Chapter 19 Regulating Hours of Work, Time Off, and Overtime . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 305

Chapter 20 Regulating the End of Employment Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 321
Chapter 21 Introduction to Human Rights at Work . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 337
Chapter 22 The Two-Step Human Rights Model and the Prohibited
Grounds of Discrimination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 351
Chapter 23 The Bona Fide Occupational Requirement, the Duty to
Accommodate, and Other Discrimination Defences . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 373
Chapter 24 Occupational Health and Safety and Workers’ Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . 391
Chapter 25 The Right to Work: Immigration and Mobility Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 407
Chapter 26 Privacy Law at Work . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 423
Chapter 27 Globalization and the Law of Work: International Labour
Law and Trade Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 439
Selected Cases: Part III . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 455
PART IV The Collective Bargaining Regime

Chapter 28 Introduction to the Collective Bargaining Regime and the
Canadian Labour Movement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 459
Chapter 29 A Brief History of Labour and the Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 475
Chapter 30 Why Do Workers Join Unions, and What Effects Do Unions
Have on Business? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 491
Chapter 31 The Unionization Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 503
Chapter 32 Unfair Labour Practices and the Right to Organize . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 525
Chapter 33 Collective Bargaining and the Making of a Collective
Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 541
Chapter 34 The Law of Industrial Conflict . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 557
Chapter 35 The Collective Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 585
Chapter 36 Grievances, Labour Arbitration, and “Just Cause” for Discipline
in the Unionized Workplace . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 611
Chapter 37 The Regulation of Unions: Legal Status, the Duty of Fair
Representation, and Decertification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 643
Chapter 38 Public Sector Labour Relations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 661
Selected Cases: Part IV . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 677
PART V The Canadian Charter of Rights and Freedoms

and Work
Chapter 39 The Canadian Charter of Rights and Freedoms
and Work . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 681
Selected Cases: Part V . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 705
Glossary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . GL:707
Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IN:721
Credits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . CR:733

Contents
Brief Contents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . iii

Preface . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xxi
Acknowledgments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xxii
Dedication . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xxiii
For Instructors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xxiii
About the Author . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xxv
Contributors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xxv
The Law of Work: A Timeline . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xxvii
PART I The Law of Work: Themes, Frameworks,

and Perspectives
CHAPTER 1
Canadian Law of Work in a Nutshell . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
II. The Three Regimes of Work Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
A. The Common Law Regime (Part II of This Text) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
B. The Regulatory Regime (Part III of This Text) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
C. The Collective Bargaining Regime (Part IV of This Text) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
III. Chapter Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Questions and Issues for Discussion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Exercise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Notes and References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
CHAPTER 2
A Framework for Analyzing the Law of Work . . . . . . . . . . . . . . . . . . . . . . . 17
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
II. Law Is What Law Does . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
III. A Framework for Analysis of the Law of Work . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
A. The Work Law Subsystem . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
B. External Inputs and the External Feedback Loop . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
IV. Chapter Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Exercise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31

vi Contents
CHAPTER 3
Key Perspectives That Shape the Law of Work . . . . . . . . . . . . . . . . . . . . . . 35
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
II. The Main Perspectives That Shape the Law of Work . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
A. The Neoclassical Perspective . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
B. The Managerialist Perspective . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
C. The Industrial Pluralist Perspective . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
D. The Critical Reformist Perspective . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
E. The Radical Perspective . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
III. Chapter Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
Exercises . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
CHAPTER 4
What Is Employment? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
II. Legal Tests for Determining Employment Status . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
A. The Common Law Tests for Employment Status . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
B. Employment Status in the Regulatory and Collective Bargaining Regimes . . . . . . . . . . . . . . . . . . . . . . 59
III. Is the Distinction Between Employee and Independent Contractor Appropriate? . . . . . . . . . . . . . . . . . . . . 63
Selected Cases: Part I . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
PART II The Common Law Regime
CHAPTER 5
A Brief History of the Common Law Model of Employment . . . . . . . . . . . . . . . . 73
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
II. Master and Servant Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
A. English Master and Servant Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
B. Master and Servant Law in the Canadian Colonies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
III. The Common Law of Employment Contracts in the 19th Century . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
A. The Common Law of Employment Contracts in 19th-Century England . . . . . . . . . . . . . . . . . . . . . . . . . . 78
B. The Common Law of Employment Contracts in 19th-Century Canada . . . . . . . . . . . . . . . . . . . . . . . . . . 80
C. Key Developments in the 20th Century . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81

Contents vii
CHAPTER 6
The Job Recruitment and Hiring Process . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
II. The Common Law and Discrimination in Job Recruitment and Hiring . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
III. Common Law Torts That Apply to Job Recruitment and Hiring . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
A. Tort of Deceit or Fraudulent Misrepresentation by a Prospective Employer . . . . . . . . . . . . . . . . . . . . . . 89
B. Tort of Negligent Misrepresentation by a Prospective Employer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90
C. Fraudulent or Negligent Misrepresentation by a Job Applicant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
Exercise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
CHAPTER 7
The Requirements to Create and Modify an Employment
Contract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
II. The Requirements to Create a Legally Enforceable Employment Contract . . . . . . . . . . . . . . . . . . . . . . . . . . . 98
A. Capacity to Enter into a Contract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98
B. Intention to Create a Legally Enforceable Contract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98
C. Three Elements of a Contract: Offer, Acceptance, and Mutual Consideration . . . . . . . . . . . . . . . . . . . . . 100
III. Making Modifications to an Employment Contract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
A. Contract Amendments When the Employee Agrees to the Change . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103
B. Modifications When the Employee Does Not Agree to the Change . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107
CHAPTER 8
Expressed Terms of Employment Contracts . . . . . . . . . . . . . . . . . . . . . . . . 113
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113
II. Interpreting “Ambiguous” Contract Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 114
III. Sources of Employment Contract Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 115
A. Restrictive Covenant Clauses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 116
B. Termination of Contract Clauses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 118
Exercise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 126
Appendix : Sample Employment Contract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 127

viii Contents
CHAPTER 9
Implied and Ancillary Employment Contract Terms . . . . . . . . . . . . . . . . . 133
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 133
II. Implied Contract Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 134
A. On What Basis Do Judges Imply Contract Terms? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 134
B. How Judges Use Implied Terms to Shape Employment Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 136
C. Implied Terms That Regulate the Conduct of Employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 138
D. Implied Terms That Regulate the Conduct of Employers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 142
III. Contract Terms Found in Ancillary Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 145
Exercise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 148
CHAPTER 10
Termination by an Employer with “Reasonable Notice” . . . . . . . . . . . . . 153
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 153
II. Employee Vulnerability and the Rules Governing Termination of Employment Contracts . . . . . . . . . . . . . . 155
III. A Brief History of the Origins of Implied Reasonable Notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 156
IV. How Modern Canadian Courts Assess an Employer’s Duty to Provide Reasonable
Notice of Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 158
A. The “Bardal Factors” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 159
B. Summary of the Bardal Factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 160
C. Other Factors Affecting the Length of Reasonable Notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 165
Exercise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 167
CHAPTER 11
Termination by “Frustration” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 169
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 169
II. The Implications of a Finding of Frustration of Contract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 169
III. The Test for Frustration of Contract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 170
IV. Frustration Due to Illness or Disability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 171
A. What Medical Evidence Is Relevant in Assessing Permanent Disability? . . . . . . . . . . . . . . . . . . . . . . . . . 171
B. Does Frustration of Contract Apply When a Contract Provides for Sickness and
Disability Benefits? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 172
C. Is the Duty to Accommodate a Disabled Worker a Precondition for Frustration
of Contract? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 173
V. Chapter Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 175

Contents ix

CHAPTER 12
Summary Dismissal: Termination for Cause Without Notice . . . . . . . . . 179
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 179
II. The Basic Legal Principles Applied to Summary Dismissal Cases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 180
A. The Proportionality Test: McKinley v. BC Tel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 180
B. Can the Employer Rely on Evidence of Employee Misconduct Learned After the
Decision to Terminate the Employee? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 182
C. Single Wrongful Acts Versus “Cumulative Just Cause” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 183
D. Employer Condonation of Employee Misconduct . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 185
E. Specific Penalty Clauses in Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 185
III. Common Grounds for Summary Dismissal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 185
A. Dishonesty and Conflict of Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 186
B. Gross Incompetence and Safety Violations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 186
C. Breach of Faithful Service to the Employer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 186
D. Insubordination and Insolence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 188
E. Harassment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 188
F. Violence and Threats of Violence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 190
G. Absenteeism and Lateness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 190
H. Off-Duty Conduct . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 191
I. Inappropriate Use of Employer Technology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 192
J. Intoxication at Work . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 193
Exercise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 195
CHAPTER 13
“You Forced Me to Quit!”: The Special Case of Constructive
Dismissal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 201
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 201
II. The Legal Concept of “Constructive Dismissal” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 202
A. Constructive Dismissal Based on Employer Behaviour That May Not Breach a
Term of the Contract but That Makes Continued Employment “Intolerable” . . . . . . . . . . . . . . . . . . . . . . 203
B. Constructive Dismissal Based on Substantial Breach of an Essential Term
of the Contract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 204
III. Common Scenarios That Give Rise to a Constructive Dismissal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 205
A. Changes to an Employee’s Compensation and Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 205
B. Changes to an Employee’s Job Assignment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 206

x Contents
C. Reassignment of an Employee to a Different Work Location . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 208

D. “Don’t Come to Work!”: Unpaid Disciplinary Suspensions, Temporary Layoffs, and
Administrative Leaves or Suspensions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 209
E. Employee Harassment or a Poisoned Work Environment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 210
IV. Employee Acceptance and Condonation of the Employer’s Repudiation of Contract . . . . . . . . . . . . . . . . . . 211
Exercise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 213
CHAPTER 14
Damages in Wrongful Dismissal Lawsuits . . . . . . . . . . . . . . . . . . . . . . . . . . 217
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 217
II. General Theory of Damages and Absence of “Specific Performance” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 217
III. Categories of Damages in Wrongful Dismissal Lawsuits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 219
A. Compensatory (or Ordinary) Damages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 219
B. Aggravated Damages for Bad Faith in the Manner of Dismissal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 222
C. Punitive Damages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 225
IV. The Duty to Mitigate Compensatory Damages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 226
A. The Standard of Mitigation Required . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 227
B. Mitigation with a Job Offered by the Former Employer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 227
Exercise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 230
CHAPTER 15
“I Quit!”: Termination of the Employment
Contract by the Employee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 237
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 237
II. The Test for Assessing Whether an Employee Has Resigned . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 238
III. The Requirement for an Employee to Give an Employer Notice of Termination . . . . . . . . . . . . . . . . . . . . . . . 239
IV. Calculating Damages When an Employee Fails to Give Proper Notice of Termination . . . . . . . . . . . . . . . . . . 242
CHAPTER 16
Tort Law and the Employment Relationship . . . . . . . . . . . . . . . . . . . . . . . . 247
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 247
II. What Is a Tort? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 248

Contents xi
III. An Employer’s Vicarious Liability for Tort Damages Caused by an Employee . . . . . . . . . . . . . . . . . . . . . . . . . 248
IV. Common Torts That Apply to Work . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 250
A. Intentional Torts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 250
B. Non-intentional Torts (Known as “Negligence”) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 254
V. Tort Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 258
VI. Chapter Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 259
Exercise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 260
Selected Cases: Part II . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 265
PART III The Regulatory Regime
CHAPTER 17
Introduction to the Regulatory Regime . . . . . . . . . . . . . . . . . . . . . . . . . . . . 271
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 271
II. Jurisdiction: The Power to Regulate Work . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 273
III. The Process of Law Making: Statutes and Regulations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 274
IV. Expert Administrative Tribunals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 277
V. What Regulatory Standards Are of Interest in the Law of Work? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 279
Exercise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 281
CHAPTER 18
Wage Regulation and Pay Equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 285
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 285
II. The Scope of Wage Regulation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 286
A. Wage Regulation Applies to Employment Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 286
B. Many Employees Are Excluded from Wage Regulation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 286
C. Wage Laws Vary by Occupation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 287
III. Minimum Wage, Wage Freeze, and Maximum Wage Legislation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 288
A. Minimum Wage Legislation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 288
B. Wage Freeze or Restraint Legislation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 290
C. Maximum Wage Legislation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 292
IV. Regulating Wage Discrimination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 292
A. Equal Pay for the Same Job (Equal Pay Laws) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 294
B. Equal Pay for Equal Work and Equal Value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 295

xii Contents

Exercise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 300
CHAPTER 19
Regulating Hours of Work, Time Off, and Overtime . . . . . . . . . . . . . . . . . 305
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 305
II. A (Very) Brief History of Working Time Laws in Canada . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 306
III. The Justifications for and Limitations of Contemporary Working Time Regulation . . . . . . . . . . . . . . . . . . . . 308
IV. Contemporary Working Time Regulation in Canada . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 309
A. Hours of Work and Overtime Pay . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 309
B. Statutory Holidays, Paid Time Off (Vacation Pay), and Food Breaks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 313
C. Leaves of Absence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 316
CHAPTER 20
Regulating the End of Employment Contracts . . . . . . . . . . . . . . . . . . . . . . 321
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 321
II. Statutory Minimum Notice of Termination Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 322
A. Common Features of Statutory Notice of Termination Provisions in Canada . . . . . . . . . . . . . . . . . . . . . . 322
B. The Interrelationship Between Statutory and Contractual Notice of Termination Requirements . . . . . 327
III. Severance Pay (Ontario and Federal) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 329
IV. Statutory Protection Against Unfair Dismissal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 330
A. Laws That Prohibit Dismissals Contrary to Public Policy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 330
B. Unjust Dismissal Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 331
CHAPTER 21
Introduction to Human Rights at Work . . . . . . . . . . . . . . . . . . . . . . . . . . . . 337
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 337
II. A (Very) Brief History of Human Rights Law in Canada . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 338
III. Common Features of the Canadian Human Rights Model . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 340
A. Anti-Discrimination Provisions Apply to the Entire Life Span of the
Employment Relationship . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 340
B. Human Rights Commissions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 342

Contents xiii
C. The Process for Filing, Investigating, and Litigating Human Rights Complaints . . . . . . . . . . . . . . . . . . . 343
D. The Remedial Powers of Human Rights Tribunals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 343
E. The Limits on Raising Human Rights Complaints in Multiple Legal Forums . . . . . . . . . . . . . . . . . . . . . . 345
IV. What Is Discrimination? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 345
CHAPTER 22
The Two-Step Human Rights Model and the Prohibited
Grounds of Discrimination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 351
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 351
II. A Two-Step Model for Analyzing Human Rights at Work . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 352
III. The Prohibited Grounds of Discrimination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 354
A. Disability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 357
B. Sex . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 359
C. Race, Colour, Ethnic Origin (or Place of Origin), Nationality, Ancestry . . . . . . . . . . . . . . . . . . . . . . . . . . . 361
D. Age . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 362
E. Religion or Creed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 363
F. Marital Status, Family Status (and Civil Status in Quebec) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 364
G. Sexual Orientation, Gender Identity, and Gender Expression . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 366
H. Political Opinion or Belief . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 366
I. Language . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 366
J. Source of Income, Social Condition, or Receipt of Public Assistance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 366
K. Record of Offence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 367
CHAPTER 23
The Bona Fide Occupational Requirement, the Duty to
Accommodate, and Other Discrimination Defences . . . . . . . . . . . . . . . . 373
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 373
II. The Bona Fide Occupational Requirement (BFOR) Defence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 374
A. The 1999 “Meiorin Test” for the BFOR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 375
B. The Duty to Accommodate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 376
III. The Special Interest Organization Defence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 384
IV. Other Defences to Prima Facie Discrimination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 386
A. The Nepotism Defence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 386
B. The Personal Care Attendant Defence, Homeworker Defence, and Domestic
Worker Defence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 387

xiv Contents
C. The Bona Fide Pension or Insurance Plan Defence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 387

D. The Special Program Defence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 387
CHAPTER 24
Occupational Health and Safety and Workers’ Compensation . . . . . . . 391
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 391
II. A (Very) Brief History of Injury Compensation and Prevention Laws in Canada . . . . . . . . . . . . . . . . . . . . . . 392
III. Contemporary Injury Prevention Legislation: Occupational Health and Safety
Legislation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 393
A. The Internal Responsibility System (IRS) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 394
B. The Employer’s Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 394
C. The Rights and Duties of Workers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 394
D. OHS Enforcement and Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 397
IV. The Criminal Liability of Organizations for Workplace Injuries and Death . . . . . . . . . . . . . . . . . . . . . . . . . . . 398
V. Workers’ Compensation Legislation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 399
A. Injury Causation and the No-Fault Principle . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 399
B. Funding Workers’ Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 400
C. Wage-Loss, Rehabilitation, and Survivor Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 401
D. The Return to Work . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 401
CHAPTER 25
The Right to Work: Immigration and Mobility Law . . . . . . . . . . . . . . . . . . 407
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 407
II. A Brief History of Migrant Workers in Canada . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 407
III. Migrant Workers and “Flexible Labour” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 409
IV. Immigration Status in Canada . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 411
A. Citizens, Permanent Residents, and Foreign Nationals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 411
V. Temporary Work Permit Programs in Canada . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 412
A. Live-in Caregiver Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 412
B. Seasonal Agricultural Worker Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 413
C. Temporary Foreign Worker Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 413
D. Open Work Permits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 415
VI. The Precarious Status of the Migrant Worker . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 415

Contents xv
VII. Employment-Related Legal Entitlements and Migrant Workers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 416

VIII. Federal Regulation of Employers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 418
IX. Chapter Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 419
CHAPTER 26
Privacy Law at Work . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 423
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 423
II. Privacy Legislation in Canada . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 425
A. Provincial Privacy Acts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 425
B. Federal Information Privacy Law: The Federal Personal Information
Protection and Electronic Documents Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 426
C. Human Rights Statutes and Privacy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 429
III. The Common Law and Privacy at Work . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 430
A. Tort Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 430
B. Contract Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 432
IV. Privacy in the Unionized Workplace . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 433
V. Recent Case Law Related to Privacy and “Reasonableness” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 434
CHAPTER 27
Globalization and the Law of Work: International Labour
Law and Trade Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 439
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 439
II. International Labour Law and the ILO . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 440
A. The Guiding Philosophy of the ILO . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 440
B. “Labour Is Not a Commodity” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 441
C. What Does the ILO Do? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 442
III. Trade Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 444
A. Direct Effects of Trade Agreements on Canadian Work Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 445
B. Indirect Effects of Trade Agreements on Canadian Work Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 448
Exercises . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 452
Selected Cases: Part III . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 455

xvi Contents
PART IV The Collective Bargaining Regime
CHAPTER 28
Introduction to the Collective Bargaining Regime and the
Canadian Labour Movement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 459
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 459
II. A Brief Overview of the Common Law’s Treatment of Collective Worker Activities . . . . . . . . . . . . . . . . . . . . 460
III. The Outputs and Legal Institutions of the Collective Bargaining Regime . . . . . . . . . . . . . . . . . . . . . . . . . . . . 465
IV. Who Is Governed by the Collective Bargaining Regime in Canada? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 466
V. Canadian Unions Today: A Snapshot . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 470
Exercises . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 473
CHAPTER 29
A Brief History of Labour and the Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 475
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 475
II. The Emerging Labour Movement: 1860s to 1910 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 476
A. Craft Unionism . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 476
B. Early Legislation Restricting Unions and Collective Worker Action: Pre-1870s . . . . . . . . . . . . . . . . . . . . 477
C. Early Legislation Regulating and Legitimizing Union Activity: 1870s and Beyond . . . . . . . . . . . . . . . . 479
D. Employer Intransigence and Increasing Worker Militancy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 481
E. Industrial Disputes Investigations Act, 1907 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 482
III. Labour in the Early 20th Century and the Interwar Years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 482
A. The Great Depression and the Wagner Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 484
B. Oshawa General Motors Strike, 1937 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 485
IV. The Foundations of the Modern Collective Bargaining Model: PC 1003 and the
“Rand Formula” (1940s) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 486
A. PC 1003 (1944): The Wagner Model Comes to Canada . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 486
B. The Rand Formula . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 487
V. Public Sector Collective Bargaining . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 488
CHAPTER 30
Why Do Workers Join Unions, and What Effects Do Unions
Have on Business? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 491
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 491
II. Why Do Workers Join Unions? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 492

Contents xvii
A. Instrumental Reasons . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 492

B. Economic Reasons . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 493
III. Other Factors That Influence the Likelihood a Worker Will Join a Union . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 495
A. Personal and Job Characteristics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 495
B. Socio-economic Status . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 495
C. The Work Environment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 496
IV. How Do Unions Affect Business Outcomes? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 496
A. Union Effects on a Company’s Productivity and Profits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 496
B. Union Effects on Employment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 498
C. Union Effects on Business Innovation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 498
D. Union Effects on Executive Compensation, Civic Engagement, and Income Inequality . . . . . . . . . . . . . 499
Exercise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 500
CHAPTER 31
The Unionization Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 503
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 503
II. The Pillars of the Canadian Collective Bargaining Model: Majoritarianism and Exclusivity . . . . . . . . . . . . . 504
III. The Union Organizing Campaign . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 504
IV. The Union Certification Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 506
A. Jurisdiction and “Trade Union” Status . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 506
B. Timeliness of Certification Applications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 507
C. Measuring Employee Support for the Union and Collective Bargaining . . . . . . . . . . . . . . . . . . . . . . . . . 508
V. Voluntary Recognition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 519
CHAPTER 32
Unfair Labour Practices and the Right to Organize . . . . . . . . . . . . . . . . . 525
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 525
II. Why a Statutory “Right to Unionize”? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 525
III. The Substance of Unfair Labour Practice Provisions Regulating Employer Behaviour . . . . . . . . . . . . . . . . . 526
A. The Intimidation and Coercion Prohibition and “Anti-Union Animus” . . . . . . . . . . . . . . . . . . . . . . . . . . . 527
B. The Interference and Domination Prohibition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 529
IV. Employer Expression Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 532
V. Remedies for Unfair Labour Practices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 535

xviii Contents

CHAPTER 33
Collective Bargaining and the Making of a Collective
Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 541
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 541
II. The Effects of Union Certification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 541
III. How Collective Bargaining Works . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 542
IV. Types of Legal Rules Regulating Collective Bargaining . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 545
A. Statutory Freeze Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 545
B. The Duty to Bargain in Good Faith and Make Reasonable Efforts to Conclude a
Collective Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 546
V. Broader-Based Collective Bargaining? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 552
CHAPTER 34
The Law of Industrial Conflict . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 557
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 557
II. Mapping the Options for Resolving a Collective Bargaining Deadlock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 557
III. The “Economic Warfare” Route . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 559
A. Union and Employee Weapons: The Strike . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 560
B. Employer Weapons: Lockouts and Unilateral Alteration of Terms of Employment . . . . . . . . . . . . . . . . . 570
IV. The Interest Arbitration Route . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 572
Appendix: City of Toronto/CUPE, 2011–2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 579
CHAPTER 35
The Collective Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 585
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 585
II. The Legal Status of Collective Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 586
III. Regulation of Collective Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 587
A. Common Mandatory Collective Agreement Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 587
B. Default Collective Agreement Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 588
C. Prohibited Collective Agreement Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 589
IV. The Principle of “Reserved Management Rights” in Collective Agreement Interpretation . . . . . . . . . . . . . . 589
V. Sources of Collective Agreement Terms and Rules of Interpretation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 591
A. Expressed Collective Agreement Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 591

Contents xix
B. Implied Contract Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 594

C. Ancillary Collective Agreement Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 598
Exercise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 601
Appendix: Sample Collective Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 605
CHAPTER 36
Grievances, Labour Arbitration, and “Just Cause” for Discipline
in the Unionized Workplace . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 611
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 611
II. The Grievance Procedure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 611
A. Filing a Grievance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 612
B. Settling or Withdrawing a Grievance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 612
III. The Labour Arbitration Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 614
IV. The Labour Arbitration Decision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 616
V. Labour Arbitration Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 616
VI. The Expanding Scope of Labour Arbitration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 617
VII. What Is “Just Cause” for Discipline or Dismissal in Unionized Workplaces? . . . . . . . . . . . . . . . . . . . . . . . . . . . 621
A. The Basic Building Blocks of “Just Cause” Arbitration Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 622
B. Summary of Specific Grounds for Discharge and Discipline . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 626
VIII. Chapter Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 635
CHAPTER 37
The Regulation of Unions: Legal Status, the Duty of Fair
Representation, and Decertification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 643
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 643
II. What Is the Legal Status of a Union to Sue and Be Sued in the Common Law Regime? . . . . . . . . . . . . . . . . 644
III. A Union’s Duty of Fair Representation (DFR) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 645
A. The History of the Duty of Fair Representation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 646
B. The Scope of the Duty of Fair Representation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 646
C. The Substance of the Duty of Fair Representation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 647
IV. The Decertification of Unions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 651
A. Decertification Due to Loss of Majority Employee Support . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 652
B. Other Reasons for Decertification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 655
C. The Effects of a Successful Application for Decertification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 655

xx Contents
CHAPTER 38
Public Sector Labour Relations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 661
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 661
II. Terminology: What Is the “Public Service”? Who Is “the Employer”? Who Is a “Public Servant”? . . . . . . . . 662
A. What Is the “Public Service,” and Who Is “the Employer” in Public Service? . . . . . . . . . . . . . . . . . . . . . . . 662
B. Who Is a “Public Servant”? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 664
III. Distinguishing Features of Public Sector Collective Bargaining Law and Policy . . . . . . . . . . . . . . . . . . . . . . 665
A. Essential Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 665
B. Public Sector Strike and Picketing Rules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 668
C. Limits on Topics That Can Be Collectively Bargained . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 668
D. Interest Arbitration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 669
E. Bargaining Unit Composition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 672
IV. Implications of Public Servants’ Duty of Fidelity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 672
Selected Cases: Part IV . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 677
PART V The Canadian Charter of Rights and Freedoms

and Work
CHAPTER 39
The Canadian Charter of Rights and Freedoms and Work . . . . . . . . . . . 681
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 681
II. What or Whom Does the Charter Govern? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 682
III. Understanding “Charter Challenges” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 683
A. Step One: Has Government Infringed a Charter Right or Freedom? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 684
B. Step Two: If an Infringement Has Occurred, Is It Justified in a Free and Democratic Society? . . . . . . . . 684
IV. How the Charter Has Influenced the Law of Work in Canada . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 686
A. The Charter and the Common Law Regime of Work Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 686
B. The Charter and the Regulatory Standards Regime . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 687
C. The Charter and the Collective Bargaining Regime . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 691
Selected Cases: Part V . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 705
Glossary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . GL: 707
Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IN: 721
Credits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . CR:733

Preface
This is a different sort of law book. It was born out of frustration with existing legal
and industrial relations texts that were, to my mind, unsuitable for the vast majority of
people who study the laws that govern work in Canada. Upper-year law school students
represent a tiny fraction of Canadians who study work law in post-secondary institu-
tions or for professional purposes. Traditional legal texts are too dense with case law for
readers who are new to the field. On the other hand, law books written specifically for
legal, business, human resource, and labour relations practitioners lack broader context
and, to quote my favourite law teacher, Harry Arthurs, “often degenerate into the mere
recitation of rules and … contribute neither to genuine interdisciplinary insights nor to
greater citizen involvement in the law.”
The Law of Work is written as an invitation to non-lawyers and lawyers alike to en-
gage with the fascinating world of labour and employment law in a more accessible and
contextual manner than is typical with most legal texts. It is the first Canadian law text
to examine at length all three regimes of work law—common law, regulatory standards,
and collective bargaining—from an interdisciplinary perspective that draws on econom-
ics, sociology, industrial relations, history, labour, and management studies. The book
is written in plain language for easy use in undergraduate and graduate university and
college courses outside the law faculty. The first edition was adopted by instructors at
universities and colleges across the country in business, human resources, industrial
relations, and labour studies. The book has also been adopted for use in Canadian law
schools in labour and employment law courses. The extensive endnotes are designed to
permit instructors in law schools to easily create a supplement for the text with addi-
tional case law and secondary materials.
We have reduced the number of chapters from the first edition by merging several
chapters and moving a few chapters to an online supplement. This was done to reduce
the overall length of the book. Additional revisions have been made based on suggestions
from instructors who have adopted the book. The second edition text moves quickly,
using many short chapters that cut through huge swaths of historical and contempor-
ary legal developments, allowing instructors to select the topics and level of detail they
wish to explore.
Part I (Chapters 1 – 4) introduces some key themes, frameworks, and perspectives that
inform the parts that follow. The “framework” in Chapter 2 maps the interrelationships
that exist throughout the various components of the “law of work” system. This is a
descriptive exercise intended to introduce to a new audience what everyone in the field
knows: that we cannot understand the laws and norms that govern work in isolation
from the broader social, political, cultural, and economic contexts in which they emerge
and function. This observation has long guided industrial relations teaching and schol-
arship. The framework also emphasizes the interrelationships and interactions among
the three regimes of work law. A central theme of the book is that the three regimes
xxi

xxii Preface
function together to create a unified system of law. While this is not an original insight,
few books bring the three regimes together in a coherent format.
Part II (Chapters 5–16) explores the common law regime, including contracts and
torts. Part III (Chapters 17–27) examines the regulatory regime, including protective
employment standards and broader regulation of labour markets. Three supplemental
chapters for Part III are also available for instructors who have adopted the book for
course use (see “For Instructors” section, below). They are “Intellectual Property Law
and Work” by May Cheng, Sarah Goodwin, and Mark Bowman; “Pensions, Insolven-
cies, Bankruptcies, and the Worker” by Simon Archer; and “Regulating Unemployment”
by David Doorey. Part IV (Chapters 28–38) considers the collective bargaining regime
and industrial relations, including how laws promote, restrain, and otherwise interact
with unions and collective bargaining processes. (Note that the chapters in Parts I and
IV are also available in a separate volume, Canadian Labour Relations: Law, Policy, and
Practice, 2nd edition, <https://www.emond.ca/CLR2>.) Finally, Part V explains the role
of the Charter of Rights and Freedoms on the laws of work. I am hopeful that this book
will mark a welcome new approach to teaching and learning about how our laws govern
the labour relationship.
This fully updated second edition introduces exciting new features, including “Apply-
ing the Law” practical exercises found at the end of most substantive law chapters. Inside
the new “Applying the Law” boxes you will find scenario-based legal problem-solving
exercises that allow students to apply the materials to real-life workplace scenarios.
Answers are provided in the Instructors’ Manual.
Acknowledgments
Many people contributed valuable research, reviewer feedback, or helpful suggestions
during the writing of this book, including Bernie Adell, Eric Tucker, Alison Braley-Rattai,
Leah Vosko, Cynthia Estlund, Michael Lynk, Rick MacDowell, Pnina Alon-Shenker,
Lorne Slotnick, Erin Kuzz, Jim Robbins, Morley Gunderson, Mark Rowlinson, Armine
Yalnizyan, Gail Misra, Rafael Gomez, Andrew Pinto, Chris Sweeney, Mitchell Doorey,
Ryan Edmonds, Jim Stanford, Awale Deria, Nick Ruhloff, Judy Fudge, Christine Sesek,
Monica Hypher, and The Junction Pigeons.
Thanks are also due to reviewers of various parts of this project: Pnina Alon-Shenker
(Ryerson University), Nicole Barnabé (University of Manitoba), Alec Gallacher (Uni-
versity of Toronto), Dan McGarry (Seneca College), and Chantal Westgate (McGill
University).
As noted below, several chapters in this book were written by some of Canada’s leading
scholars and practitioners in the field, and their expertise, cooperation, and enthusiasm
have been much appreciated. The book is much stronger for their contributions.
Special thanks are owed to Harry Arthurs, who is the inspiration for this text. Harry
provided helpful suggestions in relation to this project, but more generally has offered
unwavering support and encouragement since my law school days over two decades ago.
I also want to thank the Emond Publishing team for their hard work and for sharing
my vision for the book. In particular, great thanks are due to Mike Thompson and Paul
Emond for their enthusiastic support for the project and their many contributions to
the book, to my copy editor Leanne Rancourt, and to the rest of the team, particularly
Kelly Dickson, Anna Killen, Katherine Goodes, and Darryl Kamo.

Preface xxiii
Finally, my greatest thanks are reserved for my wonderful family. I am the luckiest
man alive that fate and the alphabet placed me beside my spouse, May Cheng, at the
British Columbia call to the bar ceremony over 20 years ago. Her boundless positive
energy inspires me every day, and this book and my new career as an academic would
not have been possible without her. And, of course, to my beautiful children, Amanda
and Dylan, who make every day special.
Dedication
This book is dedicated to my parents and to my brother Stephen. We miss you.
David J. Doorey
Toronto
For Instructors
For additional information and resources, please visit the accompanying website for this
book at www.emond.ca/LW2. The Updates tab on the site provides links to the author’s
Law of Work blog, organized to reflect the thematic structure of this book, and featuring
breaking news, updates, commentary, and more.
For information on obtaining the teaching resources available to instructors who have
chosen this book for their courses, visit the For Instructors tab on the book’s website, or
contact your Emond Publishing representative for more information. These teaching
resources include PowerPoint slides, a test bank, role playing exercises and instructions
for a collective bargaining simulation, an image bank, three supplemental chapters for
Part III of this text (as described above), and more.


About the Authors
David J. Doorey is an associate professor of work law and industrial relations at York
University and academic director of Osgoode Hall Law School’s professional part-time
LLM program, specializing in labour and employment law. He is a senior research associ-
ate at Harvard Law School’s Labor and Worklife Program, a member of the International
Committee on Harvard’s Clean Slate Project on labour law reform, and he has been a
visiting scholar at the University of Toronto Faculty of Law and Centre for Industrial
Relations and Human Resources. He is a recipient of the prestigious Dean’s Award for
Excellence in Teaching at York and is a regular media commentator on work law and
industrial relations. His scholarly articles have been published in leading Canadian
and foreign law journals, and he is articles review editor of the Canadian Labour and
Employment Law Journal. He was a recipient of the Morley Gunderson Prize and the
H.D. Woods Prize for Outstanding contributions to Canadian industrial relations and
the David Watson Memorial Award from the Queen’s Law Journal for the law journal
article making the most significant contribution to legal scholarship. His popular Law
of Work blog has been awarded the Fodden Award for the Best Law Blog in Canada and
was an inaugural inductee into the Canadian Law Blog Awards Hall of Fame in 2016.
He was called to the law bars of Ontario and British Columbia and practised labour
law on behalf of employees and unions in both provinces before returning to academia.
Professor Doorey was educated at the University of Toronto (BA, MIR), London School
of Economics and Political Science (LLM Labour Law), and Osgoode Hall Law School
(JD, PhD). He lives in Toronto’s west end and in Prince Edward County with his family
and Australian Labradoodle, and he coaches kids’ hockey.
Contributors
Simon Archer (online chapter) is a partner with Goldblatt Partners LLP and co-director
of the Centre for Comparative Research in Law and Political Economy at Osgoode Hall
Law School, York University.
Bob Barnetson (Chapter 24) is a professor of labour relations at Athabasca University.
Alison Braley-Rattai (Chapter 29) is an assistant professor in the Department of Labour

Studies at Brock University.
May Cheng (online chapter) is a partner with Osler, Hoskin & Harcourt LLP in Toronto.
Sarah Goodwin and Mark Bowman are associates with Fasken Martineau DuMoulin
LLP.
John Craig (Chapter 26) is a partner with Fasken Martineau DuMoulin LLP in Toronto.
Justine Lindner is an associate lawyer with McCarthy Tétrault LLP in Toronto.
xxv

xxvi About the Authors
Michael Lynk (Chapter 23) is an associate professor of labour law in the Faculty of Law
at Western University.
Sarah Marsden (Chapter 25) is an assistant professor in the Faculty of Law at Thompson
Rivers University.
Claire Mummé (Chapter 5) is an assistant professor of labour law in the Faculty of Law
at the University of Windsor.
Benjamin Oliphant (Chapter 39) is a lawyer with Gall Legge Grant & Zwack LLP in
Vancouver in Vancouver and an adjunct professor in the Faculty of Law at the University
of British Columbia.
Christopher C. Rootham (Chapter 38) is a partner with Nelligan O’Brien Payne LLP
and teaches at the University of Ottawa.
Scott Walsworth (Chapter 30) is an associate professor of industrial relations at the

Edwards School of Business, University of Saskatchewan.

The Law of Work: A Timeline
• Merrifield v. Canada (Attorney General) (2019): Ont. CA rules there is no “tort of harassment” in Canadian common law (2019)
LEGEND • SFL v. Saskatchewan (2015): SCC recognizes a limited Charter-protected right to strike
RED = Regulatory • “Gender identity” or “gender expression” added to some human rights statutes (2012 – 2015)
Regime • Jones v. Tsige (2012): Ont. CA recognizes privacy tort of “intrusion upon seclusion”
2010
BLUE = Collective
Bargaining • Honda Canada v. Keays (2008): SCC reforms “bad faith discharge” damages law
Regime • BC Health Services (2007): Charter protects collective bargaining
• Parry Sound (2003): Labour arbitrators must apply employment-related statutes
GREEN = Common
• RWDSU, Local 558 v. Pepsi-Cola Canada (2002): Secondary picketing is legal per se
Law Regime
2000 • Dunmore v. Ontario (2001): Expanded scope of section 2(d) of the Charter
• McKinley v. BC Tel (2001): SCC explains test for “summary dismissal”
• The Meiorin decision on the BFOR defence to employment discrimination (1999)
• Vriend v. Alberta (1998): Sexual orientation read into human rights statutes
• Wallace v. UGG (1997): Bad faith in the manner in which an employee is terminated
NAFTA (1992) • Farber v. Royal Trust Co. (1997): SCC explains the law of constructive dismissal
• Weber v. Ontario Hydro (1995): Expanded jurisdiction of labour arbitrators
1990 • Machtinger v. HOJ Industries (1992): Statutory and common law notices
Canada – US Free Trade • Central Okanagan School District, No. 23 v. Renaud (1992): The duty to accommodate
Agreement (1988) • CADP v. Alberta (1990): Duty to accommodate religion
• “Labour Trilogy” decisions (1987): No Charter right to collective bargaining, strike
• First proactive pay equity acts (Manitoba, 1986; Ontario, 1987)
• RWDSU, Local 580 v. Dolphin Delivery (1986): Charter and private common law disputes
• OHRC v. Simpsons-Sears (1985): “Indirect discrimination” recognized
1980 • Canadian Charter of Rights and Freedoms (1982)
• Wm. Scott & Co. (Re) (1977): Arbitral test applied in “just cause” for discipline or dismissal cases
• Canadian Human Rights Act (1977)
• Federal wage controls legislation for public sector and some private sector workers (1975)
• Occupational health and safety statutes
1970
• Maternity leave laws (early 1970s)
• First duty of fair representation laws (Ontario, 1971)
• Severance pay law (federal, 1970)
• Woods Task Force on Labour Relations (1967)
• R. v. Arthurs, Ex p. Port Arthur Shipbuilding Co. (1967): Summary dismissal without notice
• Federal Public Sector Staff Relations Act (1967)
1960 • Russel Steel (1966): Reserved management rights doctrine in labour arbitration
• Statutory notice of termination laws (mid to late 1960s)
• Hersees of Woodstock v. Goldstein (1963): Secondary picketing is illegal per se
• Ontario Human Rights Code (1962)
ILO Equal Remuneration • Canadian Bill of Rights (1960)
Convention (1951) • Bardal v. Globe & Mail Ltd. (1960): Criteria for assessing “reasonable notice”
• Standard 8-hour day, 40-hour week legislation in some provinces
1950 • Canadian Labour Congress formed (1956)
ILO Convention 98 (1949) • Female Employees Fair Remuneration Act (Ontario, 1951)
• Fair employment practices laws banning discriminatory hiring (early 1950s)
ILO Convention 87 (1948) • First racial discrimination laws (Ontario, 1944; Saskatchewan, 1947)
UN Universal Declaration of • “Rand Formula” award (1946)
Human Rights (1948) • Paid vacation laws (1944 – 1950)
• PC 1003: Template for modern collective bargaining laws (1944)
1940
Second World War (1939 – 1945) • Christie v. The York Corporation (1940): Discrimination in contract permissible
• Unemployment Insurance Act (1940)
American Wagner Act (1935)
• Carter v. Bell & Sons (Canada) Ltd. (1936): Termination with “reasonable notice”
• “On to Ottawa Trek” (1935)
• Men’s minimum wage, 8-hour day legislated in various provinces
1930
Great Depression (1929 – 1933) • Unemployment “relief” camps (1930)
ILO Minimum Wage Fixing
Convention (1928)
• TEC v. Snider (1925): Provinces have primary jurisdiction over work law
• First minimum wage law for men (BC, 1925)
• First 8-hour day, 48-hour week law (BC, 1923)
1920
ILO Hours of Work Convention
(1919) • Winnipeg General Strike (1919)
• Early minimum wage laws for females only (1917 – 1920)
ILO formed (1919)
First World War (1914 – 1918) • Workmen’s compensation legislation (1914 – 1920)
• Meredith Commission on Workers’ Compensation (1913)
1910
• Industrial Disputes Investigation Act (1907): Mandatory government conciliation

• Lord’s Day Act (1906): Prohibited conducting of business on Sundays
• Railway Labour Disputes Act (1903): Early labour dispute conciliation law
1900
10 15 20 25 30 35 40
Union density, 1920–present (% of non-agricultural paid employees in unions)
Copyright © 2020 David Doorey. All rights reserved.


Part I
The Law of Work:
Themes, Frameworks,
and Perspectives
CHAPTER 1 Canadian Law of Work in a Nutshell

CHAPTER 2 A Framework for Analyzing the Law of Work
CHAPTER 3 Key Perspectives That Shape the Law of Work
CHAPTER 4 What Is Employment?
Selected Cases: Part I


CHAPTER 1
Canadian Law of Work

in a Nutshell
LEARNING OBJECTIVES CHAPTER OUTLINE
After reading this chapter, students will be able to: I. Introduction 3
II. The Three Regimes of Work Law 4
• Describe the three regimes that comprise the law of work in Canada.
A. The Common Law Regime (Part II of This Text) 4
• Describe the two branches of the common law that regulate work and B. The Regulatory Regime (Part III of This Text) 9
employment. C. The Collective Bargaining Regime (Part IV of This Text) 11
• Understand the levels of courts in Canada. III. Chapter Summary 12
• Define precedent and the principle of stare decisis. Questions and Issues for Discussion 13
• Describe the role of the courts, governments, and expert administrative Exercise 13
tribunals in the law of work. Notes and References 14
• Recognize how the concepts of freedom of contract and inequality of
bargaining power have influenced the development of the law of work
in Canada.
I. Introduction
At the beginning of a long journey, it is useful to survey a topographical map of the terrain to
come—to study the forest canopy before entering the thicket. We can see patterns from above
not apparent from the forest floor. It helps to have a sense of where we are going so that we can
anticipate what is to come. Therefore, we will begin our journey by looking down at a map of
sorts: a map of the law of work in Canada. This map charts the manner in which our legal system
regulates labour markets and the buying and selling of labour.
For over a century, legal scholars have studied these laws. In truth, though, scholars have mostly
been interested in work performed through one specific organizational form: employment. Work-
ers can of course sell their labour through arrangements other than employment. I once contracted
with a company called High Park Building Services Inc. (or HPBS) to build me a backyard deck. It
turned out that HPBS was really just a guy named Jason Phillips who was between jobs and who
had set up a company so that he could use his carpentry skills to earn some money. Whether I hired
Jason as my employee or contracted with a company called HPBS is crucially important to how the
law treats our relationship. If Jason is my employee, then all of the laws that govern employment
considered in this text apply to our relationship. But if my contract is with the company HPBS,
maybe none of them do. It’s the same work in either case, but the legal rules that govern the work
are fundamentally different depending on how our relationship is characterized.
Whether so much should depend on this fine distinction between employment and
not employment is one of the great debates in our legal field.1 We will revisit this debate at
employment: An organizational form through which a person (employee) sells their labour power to a buyer of labour
(employer) in exchange for value and in which the relationship is governed by an employment contract.

4 Part I The Law of Work: Themes, Frameworks, and Perspectives
various points throughout this text, and we will explore how the law draws the distinction
between an employee and a worker who is not an employee in Chapter 4. The reason for
mentioning the “employment” versus “not employment” distinction at this early stage is to
explain the boundaries of our map of the law of work set out in this chapter. It is a high-level
map of how Canadian law governs the employment relationship. It does so through three
distinct legal regimes: (1) the common law of employment; (2) regulatory law; and (3) col-
lective bargaining law.
This chapter provides an overview of the key components of the legal system that governs
employment in Canada, outside of Quebec. Quebec is a special case because its legal system,
including much of the law that governs the employment relationship, is based on the French
model of civil law rather than the British-based common law system applied elsewhere in
Canada. Therefore, while we will occasionally consider cases and regulations originating in
Quebec in this text, our focus will be on the legal system that governs the rest of Canada.
II. The Three Regimes of Work Law

As noted above, the system of laws that governs employment in Canada (outside of Quebec)
consists of three distinct yet overlapping regimes (see Figure 1.1):
1. The common law regime (covered in Part II).

2. The regulatory regime (covered in Part III).
3. The collective bargaining regime (covered in Part IV).
FIGURE 1.1 Mapping the Three Regimes of Work Law
Common Law
Regime
Collective
Regulatory Bargaining
Regime Regime
What follows is a brief introduction to each of these regimes. The remainder of the text is
devoted to filling in the details.
A. The Common Law Regime (Part II of This Text)

The common law regime comprises both the law of contracts and the law of torts.

Chapter 1 Canadian Law of Work in a Nutshell 5
1. The Law of Contracts

The cornerstone of the common law regime is the contract and, in particular, employment
contracts between employers and individual (non-union) employees. A contract is a legally
binding agreement in which two or more parties make promises to provide benefits to one an-
other. In a typical employment contract, the employee promises to provide labour power in
exchange for monetary compensation in the form of a wage paid by the employer, and some-
times other benefits, such as health benefits and pension contributions. The two parties discuss,
or negotiate, what the terms of the contract will be, and their agreement becomes a contract, a
source of legal rules by which the parties are to be governed.
BOX 1.1 » TALKING WORK LAW

Understanding Legal Terminology
In Canada and the United States, the common law regime and the regulatory standards regime are
commonly grouped together under the label employment law.
The legal regime that governs collective bargaining processes, by contrast, is usually referred to
as labour law.
This text uses the terms work law and law of work synonymously to refer to the entire system of
legal rules comprising all three legal regimes.
While the law of contracts has deep roots in the common law system, dating back centuries
in Britain, the law of employment contracts dates only from the late 1800s in Canada.2 Prior to
that time, the relationship between buyers and sellers of labour was dealt with under a branch
of law known as master and servant law and through a mix of contract, property, criminal,
and tort law.3 We will learn more about master and servant law later in the text, particularly in
Chapter 5, as well as tort law. For now, it is sufficient to note that master and servant law permit-
ted workers (“servants”) to recover unpaid wages from their employers (“masters”), but also
allowed for workers who quit a job to be imprisoned.4 Legal historians describe master and
servant law as a system of rules based on “status,” by which they mean that workers were con-
sidered subservient to their masters, and therefore subject to their masters’ largely unquestioned
authority. The master and servant regime was exported from Britain into parts of early Canada,
but by the early 1900s it had been largely supplanted by the emerging common law of the
employment contract and the principle of freedom of contract.5
“Freedom of contract” is a powerful idea. Its supporters argue that allowing employees and
employers to “negotiate” the conditions of employment leads to the fairest and most efficient
outcomes for the parties, the economy, and society as a whole. Professor Hugh Collins of Oxford
University summarized the central arguments made in favour of freedom of contract as a means
of coordinating employment relations as follows:
contract: A legally binding agreement consisting of reciprocal promises between two or more parties.
employment contract: A contract between an employer and an individual employee that defines the conditions under which
the employee will provide labour to the employer in exchange for a monetary benefit (wages, salary), and sometimes other
benefits (e.g., health benefits). An employment contract may be written or oral.
common law: A system of judge-made rules originating in England around the 12th century, and inherited by Canada as
a British colony, that uses a precedent-based approach to case law. Earlier decisions dealing with similar facts or legal issues
guide later decisions in an attempt to create legal predictability. However, common law rules can and often do evolve as social
values change.

The principle of freedom of contract removes the possibility of workers being treated exactly like
commodities, because by giving them the power to choose, the principle ensures the elementary
respect for the dignity, autonomy, and equality of citizens. So too the principle ensures a measure of
justice and fairness by permitting everyone to seek work without discrimination and obstructions
to competition. Furthermore, freedom of contract permits the parties to regulate their own relation-
ship in order to deal with the special difficulties presented by the unique combination of character-
istics of the employment relationship. The parties are likely to have the best information about where
their interests lie, and therefore they should be permitted to forge a compromise between their
competing interests without interference by a paternalistic state.6
Occasionally, disputes arise between employers and employees in which one of the parties
accuses the other of violating the employment contract. Those disputes may end up in a courtroom
in front of a judge if one party sues the other party for breach of contract. If the lawsuit does not
settle (most do), a judge will conduct a trial. At the trial, the parties will present a story to the judge
in the form of documentary evidence and witness testimonies, recounting versions of what hap-
pened leading up to the disagreement. The judge must then decide whether the contract was
breached and, if so, what the guilty party should be ordered to do as a remedy for the breach.

The Law of Work and Higher Education
Work law is taught to thousands of students each year in needed to visit a law library to conduct research on old cases.
dozens of Canadian universities and colleges, including in Nowadays, much if not all of that legal research can be con-
law schools but also in programs in business and commerce, ducted electronically through the use of both free (CanLII) and
human resource management, legal studies, labour studies, fee-based services (Lexis Advance Quicklaw).
industrial relations, and paralegal training. The number of The exercise at the end of this chapter gives you the op-
students learning work law in programs outside of law portunity to practise finding common law case law using
schools far outnumbers those in law schools. This is not CanLII (<https://www.canlii.org>), which provides free online
surprising with so many professions that require knowledge access to Canadian case law and legislation databases.
of work laws. Only lawyers who have
attended law school and passed the
required bar exams can practise work
law as a profession. In Canada, there are
17 law schools that offer a Juris Doctor
(JD) or Bachelor of Laws (LLB) in the
common law model, four that offer de-
grees only in the civil law model used
in Quebec, and two (University of Ot-
tawa and McGill University) that offer
programs in both legal systems.
Each law school has its own law li-
brary. The largest law library in Canada
is housed at Osgoode Hall Law School at
York University in Toronto, with over
800,000 volumes. Each province’s profes-
sional legal body, or “law society,” also
has a law library. In the past, lawyers
The Great Library at Osgoode Hall Law School in Toronto.
breach of contract: Occurs when a party to a contract violates one or more terms of a legally binding contract.
remedy: The means by which a court or tribunal enforces its decision, such as by ordering the guilty party to pay monetary
damages or take such further action the court deems appropriate to compensate victims for loss or deter future wrongful conduct.

The judge writes a decision that is distributed to the parties and then published in legal case
digests and, nowadays, electronic case databases. At that point, the decision becomes part of the
common law of employment contracts, a large body of legal decisions about employment contracts
dating back to the beginning of the employment model in 19th-century Britain. The common law
of employment contracts in Canada now comprises hundreds of thousands of decided cases.
Lawyers research case law in search of decisions and reasoning that support their arguments.
They also must be prepared to distinguish cases that do not support their argument—to explain
to the judge why a previous decision relied on by their opponent is different from the one they
are dealing with now. This process is necessary because the common law system operates on a
precedent-based system known as stare decisis, a Latin phrase meaning, loosely, “to stand by a
previous decision.” Guided by a desire for the law to be predictable, the principle of stare decisis
instructs judges to follow the reasoning and outcomes in earlier cases that dealt with similar
legal issues and facts.
If the earlier decision was decided by a higher level of court from the same jurisdiction (see
Figure 1.2 for the levels of Canadian courts), then the reasoning in that decision is a binding
precedent. This means that a lower court judge who later deals with a lawsuit involving the
same, or very similar, factual and legal circumstances must apply the same legal reasoning
applied by the higher court, even if they do not agree with it. Decisions that are not binding
precedents can still have “precedent” value. Since the common law system prefers predictability,
judges usually follow earlier decisions, even those that are not issued by a binding higher court,
unless they distinguish the facts or legal issues decided in the earlier decision or they rule that
the earlier decision was just plain wrong.
2. The Law of Torts

Torts are the second branch of the common law. A tort is a legal wrong defined by judges to
allow a person to recover damages for harm caused by the actions of another person when the
harm caused does not violate a contract or government statute.7 Many of the torts that are
applied in Canada were initially developed years ago by British judges. You have likely heard of
some of them, even if you did not know they were called torts: nuisance, trespass, deceit, negli-
gence, conspiracy, defamation, and assault and battery. All of these torts have potential applica-
tion to the relationships that structure work in our society. Other less well-known yet important
torts with application to work include intentional infliction of mental suffering and negligent
misrepresentation. Chapter 16 explores some of the most important applications of tort law to
the workplace in the common law regime.
distinguish: To explain how a prior legal decision dealt with facts or legal issues that are different from the facts or issues in
the current case.
precedent: An earlier decision by a judge that dealt with the same, or very similar, facts and legal issues as those before a
judge in the current case.
stare decisis: A Latin term meaning “to stand by a previous decision.” It is a guiding principle in the common law regime.
jurisdiction: The scope of authority over which a government, court, or expert administrative power has the power to govern.
binding precedent (or binding decision): An earlier decision by a court of higher ranking dealing with the same legal
issue in a case that comes before a lower court judge. The lower court judge is required to apply the same reasoning and legal
test applied by the higher court.
tort: A type of wrongful act done by one person to another (or to another’s property) that judges have recognized as legally
actionable. Examples are nuisance, trespass, negligence, and conspiracy.
statute: A law, or legislation, produced by a government that includes rules that regulate the conduct of business and people.
An example is the Ontario Employment Standards Act, 2000.

FIGURE 1.2 Levels of Canadian Courts
Supreme Court of Canada (SCC)

Sits in Ottawa. Hears final appeals from all jurisdictions in Canada.
Court must first grant “leave” (permission) to hear an appeal.
Courts of Appeal
Each province and territory (except Nunavut) has its own Court of Appeal. There is also a
Federal Court of Appeal that hears appeals from lower-level federal courts and tribunals.
Courts of First Instance (Lower Courts)

These courts have different names across the country, and, other than in Nunavut, where there is a uni-
fied Court of Superior Justice, the courts of first instance are usually further subdivided into inferior and
superior courts, which have jurisdiction over different subject matter. Judges in the inferior courts are
appointed by the provinces, whereas superior court judges are appointed by the federal government.
Superior courts have general authority to hear most private lawsuits and serious criminal matters, while
inferior courts are usually assigned less serious criminal matters, traffic violations, and some specialized
subject matters, such as many family law matters. Most (though not all) employment-related matters
are heard initially in the superior courts of the jurisdiction in which the legal proceeding is launched.
Here is a quick overview of provincial and territorial courts of first instance:
JURISDICTION INFERIOR COURT SUPERIOR COURT

Alberta Provincial Court Queen’s Bench
British Columbia Provincial Court Supreme Court
Manitoba Provincial Court Queen’s Bench
New Brunswick Provincial Court Queen’s Bench
Newfoundland & Labrador Provincial Court Supreme Court
Northwest Territories Territorial Court Supreme Court
Nova Scotia Provincial Court Supreme Court
Ontario Ontario Court of Justice Superior Court of Justice
Prince Edward Island Provincial Court Supreme Court
Quebec Court of Quebec Superior Court
Saskatchewan Provincial Court Queen’s Bench
Yukon Territorial Court Supreme Court

The usual remedy for a tort violation is monetary damages, but judges can also order injunctions
to remedy a tort. An injunction is an order to stop doing something unlawful. As we will learn in
Part IV, torts and the courts’ use of injunctions have played an important role throughout history in
restricting collective activities of workers, such as strikes and picketing, aimed at winning better
working conditions.8
B. The Regulatory Regime (Part III of This Text)

As noted above, the common law regime is guided by the powerful claim that “freedom of con-
tract” advances individual liberty while producing the most efficient and desirable distribution
of skills and resources in a society. On this basis, defenders of freedom of contract argue that the
courts and governments should limit their intervention in employment relations to enforcing
contracts between employers and individual workers.9 However, this position has long been the
subject of intense debate and dissent.
Most of the time, employers enjoy far superior bargaining power as compared with employ-
ees and are therefore able to unilaterally fix the terms of the contract. This “inequality of bar-
gaining power” leaves most employees with a simple choice of whether to accept or not accept
the terms the employer offers. No negotiation takes place at all. Think about your job, if you have
one. Did you engage in negotiations with your employer at the time you were hired, or did you
just accept whatever wage rate and other conditions your employer provided? Employees of
Walmart or Tim Hortons do not normally negotiate over starting wages or health benefits. Typ-
ically, the employers present a standard form employment contract (if they even bother to put
anything in writing), and the worker signs it.
Sometimes a person has multiple job possibilities, so they may be able to reject a poor offer by
one or more employers. However, often, and particularly in periods of high unemployment and for
jobs requiring low skills, far more workers are seeking work than there are jobs available. Since most
workers require income from work to survive, the option of not accepting a job is often not a real-
istic one. In most cases, workers need a job far more than an employer needs any particular worker.
The fact that the more powerful party—employers—can almost always fix the terms of the
employment contract unilaterally is not a new insight. Adam Smith (1723 – 1790) knew it, as did
Karl Marx (1818 – 1883), two great thinkers with very different perspectives on the role of markets,
law, and work.10 German sociologist Max Weber (1864 – 1920) summarized the point as follows:
The formal right of a worker to enter into any contract whatsoever with any employer whatsoever
does not in practice represent for the employment seeker even the slightest freedom in the determin-
ation of his own conditions of work, and it does not guarantee him any influence in the process. It
rather means, primarily, that the more powerful party in the market, i.e., normally the employer, has
the possibility to set the terms, to offer a job “take it or leave it,” and given the normally more pressing
economic need of the worker, to impose his terms upon him.11
The Supreme Court of Canada has recognized that employment contracts are distinguishable
from typical commercial contracts by the inherent inequality of bargaining power involved. For
example, in the 1992 case of Machtinger v. HOJ Industries, the court agreed with the following
observations by Professor Katherine Swinton:
[T]he terms of the employment contract rarely result from an exercise of free bargaining power in
the way that the paradigm commercial exchange between two traders does. Individual employees on
the whole lack both the bargaining power and the information necessary to achieve more favourable
contract provisions than those offered by the employer, particularly with regard to tenure.12
injunction: A legal order issued by a judge prohibiting a person from engaging in a particular course of action, such as breach-
ing a contract, committing a tort, or violating a statute.

The claim that employees usually are the weaker party in the employment contract is not very
controversial. However, whether this inequality of bargaining power is problematic and creates
a need for legislative intervention to protect employees is one of the great debates in work law
policy.13 We will explore it throughout this text. However, it was important to introduce the
debate at this early point in order to understand the origins of the second regime of work law,
the regulatory standards regime.
In practice, employers often have not exercised their superior power in a responsible man-
ner deemed acceptable to society. In the early days of industrial capitalism in Canada, for ex-
ample, before much employment protection legislation existed, working conditions were often
horrific, characterized by dangerous practices, long hours, low pay, and verbal and physical
abuse at the hands of employers. Consider the following description of working conditions in
some late 19th-century Canadian factories, as described by a commissioner in a government
inquiry:
Many children of tender age, some of them not more than nine years old, were employed in cotton,
glass, tobacco, and cigar factories. … Some of them worked from six o’clock in the morning till six
in the evening, with less than an hour for dinner, others worked from seven in the evening till six in
the morning. … The darkest pages in the testimony … are those recording the beating and imprison-
ment of children employed in factories. Your Commissioners earnestly hope that these barbarous
practices may be removed, and such treatment made a penal offence, so that Canadians may no
longer rest under the reproach that the lash and the dungeon are accompaniments of manufacturing
industry in the Dominion.14
The sorts of working conditions described in the preceding passage led governments across
Canada to intervene in freedom of contract by enacting legislation (statutes and regulations)
that regulates working conditions. In fact, there has never been a time in Canada when employ-
ment was purely a matter of free contracting; for as long as employment has existed, so too has
employment regulation.
Nowadays, employment is among the most regulated of all relationships in society. In Part
III, we will examine government legislation that regulates wages and working time, workplace
health and safety, human rights and discrimination, workers’ compensation, and other forms
of legislation that aim to protect employees. Legislation that has as its central purpose the pro-
tection of vulnerable employees from the superior bargaining power of employers is known as
protective standards regulation.15 There are other types of legislation relevant to the law of
work that do not specifically target vulnerable workers but nevertheless affect labour markets
and the employment relationship in important ways. For example, vulnerable employees are
not the focus of intellectual property (IP) legislation, but IP laws affect who owns the product
of a worker’s labour. Immigration laws determine who is entitled to work in Canada. Legisla-
tion governing bankruptcies, privacy, pensions, and global trade is not directly or solely dir-
ected at the employment relationship, but these laws have important effects on that relationship.
Thus, the law of work includes both protective standards regulation and the broader system of
legal rules that have important effects on labour markets. We consider both types of legislation
in Part III.
regulations: Government-made detailed rules introduced as a supplement to, and pursuant to authority created in, a statute.
For example, the Ontario Employment Standards Act, 2000 requires that employers pay at least “the prescribed minimum wage,”
but does not say what that wage rate is. That act gives the government the right to introduce regulations (in s. 141), and one
regulation (O. Reg. 285/01) sets out the precise amount of the minimum wage.
protective standards regulation: Government regulation designed primarily to protect employees by imposing mandatory
standards, such as minimum contract requirements and safety rules.

Regulation is usually enforced by a combination of government inspections and complaints

filed by people who believe their statutory rights have been violated. The task of hearing those
complaints falls to expert administrative tribunals. Tribunals are created by statutes and are not
the same as courts, although they sometimes function in a similar manner. Governments staff
tribunals with experts in the field, who help employers and employees resolve disputes through
mediation. When settlements cannot be obtained, tribunals hold hearings and issue legally bind-
ing decisions. By assigning authority over employment statutes to expert administrative tribu-
nals, governments also limit the volume of employment-related disputes going to the courts.
For example, one of the busiest administrative tribunals in Canada is the Ontario Labour
Relations Board, which has authority to interpret several employment-related statutes, includ-
ing the provincial Labour Relations Act and Employment Standards Act. The adjudicators are
known as chairs or vice-chairs, and almost all are former practising lawyers in the field. The
adjudicators conduct hearings and issue decisions resolving disputes arising under those stat-
utes. Similar tribunals exist in every jurisdiction in Canada. The courts play a smaller role in the
regulatory standards regime than in the common law regime. The role of the courts is limited
mostly to reviewing tribunal decisions to ensure that the tribunal does not exceed the authority
granted it under its constituting statute, a process known as judicial review.
C. The Collective Bargaining Regime (Part IV of This Text)

The third regime of work law, the collective bargaining regime, is also primarily a response to
the imbalance of power in the employment relationship. However, rather than impose manda-
tory rules (“pay at least the minimum wage,” “do not work more than 48 hours in a week,” “do
not pay women less than men for the same work”) like the regulatory standards regime, the
collective bargaining regime addresses the inequality of bargaining power by conferring more
power on workers so that they can bargain a better deal for themselves. Whereas a single worker
acting alone usually lacks sufficient power to bargain with their employer over working condi-
tions, a group of workers acting in combination often does have sufficient power to bargain. If
those workers, acting as a collective, can withhold their labour (strike) as bargaining leverage,
then their bargaining power grows substantially.
The collective bargaining regime is concerned with the processes through which workers act
collectively in pursuit of higher wages and better benefits and working conditions. Otto Kahn-
Freund (1900 – 1979), who was professor of law at Oxford University, provided a now often-cited
justification for labour (collective bargaining) laws:
In its inception [the employment relationship] is an act of submission, in its operation it is a condi-
tion of subordination, however much the submission and the subordination may be concealed by
the indispensable figment of the legal mind known as the “contract of employment.” The main object
of labour [collective bargaining] law has always been, and we venture to say will always be, to be a
countervailing force to counteract the inequality of bargaining power which is inherent and must be
inherent in the employment relationship.16
expert administrative tribunals: Decision-making bodies created by a government statute and given responsibility for
interpreting and enforcing one or more statutes and any regulations pursuant to that statute.
judicial review: The process through which a decision of an expert administrative tribunal is appealed to a court on the basis
that the tribunal exceeded its authority (or jurisdiction) as defined in the statute that created it or that the tribunal’s decision
was wrong. How much deference a court must give to the expert tribunal’s decision is a complex question that is considered in
a field of law known as administrative law.
strike: Legislation can assign a particular definition to the word strike. In Canada, strikes are usually defined to include both
(1) a collective refusal by employees to perform work, and (2) a deliberate collective slowdown by workers designed to restrict
the output of an employer (commonly known as a work to rule).

This idea that collective bargaining produces a “countervailing force” that permits employees
to deal with the employer on a more equal footing is central to the collective bargaining regime.
Whether law should encourage or prohibit collective worker action is one of the great enduring
debates in labour law and policy. We will explore these issues in detail in Part IV.
The collective bargaining regime comprises three categories of legal rules:
1. Government-made statutory rules found in labour relations statutes regulating the

formation and administration of unions, collective bargaining, and industrial conflict,
enforced by expert administrative tribunals called labour relations boards.
2. Collectively bargained rules found in collective agreements. Employers and unions
usually negotiate these, although in some cases collective agreements are imposed in
whole or in part by interest arbitrators. Collective agreement rules are enforced by
either labour boards or expert labour arbitrators.
3. Judge-made rules based in common law torts that mostly apply to labour picketing and
strikes, which are issued and enforced by the courts.
All three categories of rules function together to create a complex, multi-layered legal model
that seeks to balance the sometimes overlapping but often competing interests of workers and
employers and their associations, suppliers, consumers, the broader society, and the economy
in general. Canadian government support for collective bargaining has ebbed and flowed dra-
matically over the past century, from outright hostility prior to the 1940s to cautious support in
the decades following the Second World War to resistance again, at least by conservative polit-
ical parties, since the 1980s.17 We will discuss these trends in greater detail in Part IV, including
ways in which law and labour policy is used by governments to promote or discourage the
spread of collective bargaining.
Once workers are covered by a collective agreement, the legal rules of contract interpretation
applied by judges to individual employment contracts in the common law regime, introduced
above and explored in Part II of the text, no longer apply. The collective bargaining regime
replaces the common law of the employment contract for unionized workers. Canadian labour
law statutes require that all disputes between unions and employers about the interpretation and
application of collective agreements be resolved by labour arbitrators rather than judges. Since
the 1940s, labour arbitrators have developed a large body of labour arbitration case law, and
many of the rules of interpretation that are applied to collective agreements are different from
those applied to individual employment contracts by judges in the common law regime, as we
will learn in Part IV of this text.18
III. Chapter Summary

This chapter introduced the three regimes of work law that regulate the employment relation-
ship in Canada at a general level, as if we were looking down at a topographical map of the law.
We can summarize what we learned as follows:
collective agreement: A contract between an employer (or employers) and a trade union (or trade unions) that sets out the
conditions of employment for a group of employees.
interest arbitrator: An individual or three-person expert arbitration board tasked with writing the terms of a collective agree-
ment when the union and employer are unable to reach agreement through voluntary collective bargaining.
labour arbitrator: An individual or three-person expert arbitration panel appointed to decide disputes over the application
and interpretation of collective agreements.

• The common law regime is concerned with legal rules found in employment contracts
between individual employees and employers, including rules judges have developed
over the years when interpreting those contracts, and with another branch of judge-made
legal rules known as torts. We learn more about this regime in Part II.
• The regulatory regime is concerned with rules governing the work relationship—and
employment contracts in particular—created by governments and codified in legislation
(statutes and regulations). The regulatory regime includes both legislation designed to
protect vulnerable employees and legislation that affects labour markets in substantial
ways. Those rules are interpreted by expert administrative tribunals created by govern-
ments for that purpose. We learn more about this regime in Part III.
• The collective bargaining regime is concerned with three categories of legal rules. The first
category comprises government-made statutory rules that regulate areas including union
formation, collective bargaining processes, and industrial conflict. The second comprises
collective bargaining rules found in collective agreements, which are negotiated by
unions (on behalf of employees) and employers (and sometimes employer associations).
Labour arbitrators decide collective agreement disputes, guided by a large volume of
labour arbitration jurisprudence developed since the 1940s. The third comprises judge-
made rules based in common law torts that continue to apply within the collective bar-
gaining regime, particularly in relation to picketing and strikes. We learn more about this
regime in Part IV.
QUESTIONS AND ISSUES FOR DISCUSSION

1. What two branches of law comprise the common law regime?
2. Briefly explain the three regimes of work law. Who (or what) is responsible for resolving
disputes that arise under each of the three regimes?
3. What are three levels of courts in Canada?
4. Explain the concept of stare decisis.
5. What are some strengths and weaknesses of “freedom of contract” in the context of work
law?
6. What three categories of legal rules compose the collective bargaining regime?
EXERCISE
Throughout this text, we will examine a lot of case law decided by courts and expert adminis-
trative tribunals. In the past, accessing case law was difficult and mostly the domain of lawyers.
It required visiting a law library and conducting complicated legal research using dense legal
reporting books and complex legal research skills honed in law school and years of legal
practice.
Today, lawyers and non-lawyers alike can access legal decisions on their computers. While
the most thorough legal databases require payment of expensive fees, increasingly legal deci-
sions are being posted on free Internet databases. The Canadian Legal Information Institute
(CanLII) is a prime example. It is produced by the various Canadian law societies with the goal
of making “Canadian law accessible for free on the Internet.”
This text includes a number of exercises that encourage readers to conduct their own legal
research using CanLII. To give you a sense of how CanLII works, try the following exercise.
1. Go to the CanLII home page: <https://www.canlii.org>.

2. In the search window, type the phrase “wrongful dismissal” in quotation marks. That
search should give you over 7,000 legal decisions.

3. Find one decision that sounds interesting to you from the brief description that appears in
the search results. Select the link to the decision. Answer the following questions:
a. What is the name of the case?
b. What year was the case decided?
c. In what province did the case originate?
d. Was the case decided by a court or an expert administrative tribunal?
e. If it was a court, which court? If it was a tribunal, which tribunal?
f. Read the case. Can you determine what the dispute was about and which party won the
case?
If this is your first time reading a legal decision, it may be difficult for you to follow what is
happening. Do not fear, because that is normal. Reading the law takes a bit of practice because
the law uses specialized language. We will decipher this language throughout this text.
NOTES AND REFERENCES

1. G. Davidov, “The Reports of My Death Are Greatly Exag- advocating the freedom of contract school of employment
gerated: Employee as a Viable (Though Overly-Used) law and the common law model that supports it include R.
Legal Concept,” in G. Davidov and B. Langille, eds, Posner, Economic Analysis of Law, 5th ed (New York:
Boundaries and Frontiers of Labour Law (Oxford: Hart, Aspen Law and Business, 1998) at chapter 8; M. Fried-
2006) 133 at 133-34; B. Langille, “Labour Law’s Back man, Capitalism and Freedom (Chicago: University of
Pages,” in Davidov and Langille, ibid., at 13; and J. Fudge, Chicago Press, 1962); R. Epstein, “In Defense of Contract
E. Tucker & L. Vosko, “Changing Boundaries in Employ- at Will” (1984) 51 U Chicago L Rev 947; and R. Epstein,
ment: Developing a New Platform for Labour Law” (2003) Simple Rules for a Complex World (Cambridge, MA:
10 CLELJ 329; and H. Collins, “Independent Contractors Harvard University Press, 1995) at chapters 8 and 9.
and the Challenge of Vertical Disintegration to Employ- 7. On Canadian tort law, see E. Weinrib, Tort Law: Cases and
ment Protection Laws” (1990) 10 Oxford J Legal Stud 353. Materials, 4th ed (Toronto: Emond Montgomery, 2014);
2. C. Mummé, The Indispensable Figment of the Legal Mind: and A.M. Linden, Canadian Tort Law, 6th ed (Toronto:
The Contract of Employment at Common Law in Ontario, Butterworths, 1997).
1890 – 1979 (PhD dissertation, Osgoode Hall Law School, 8. See the discussion in H. Carty, An Analysis of the Eco-
2013) at 83. nomic Torts (Oxford: Oxford University Press, 2001).
3. P. Craven, “The Law of Master and Servant in Mid-Nine- 9. See, e.g., Posner, supra note 6, at chapter 11.
teenth Century Ontario” in D. Flaherty, ed, Essays in the
10. A. Smith, An Inquiry into the Nature and Causes of the
History of Canadian Law, vol. 1 (Toronto: University of
Wealth of Nations, vol. 1 (London: 1776) at 81: “it is not …
Toronto Press, 1981) 175-211.
difficult to foresee which of the two parties must, upon all
4. See, e.g., An Act to Regulate the Duties Between Master ordinary occasions, have the advantage in the dispute, and
and Servant, and for Other Purposes Therein Mentioned, force the other into compliance with their terms. … In all
S. Prov. Can. 1847, c. 23, S. Prov. Can 1851, c. 11; and such disputes the masters [employers] can hold out much
Ontario Master and Servant Act of 1855, 18 Vict., c. 136. longer.” K. Marx & F. Engels, The Communist Manifesto
5. Sir Henry Maine famously wrote that “the movement of (London: 1848) at 347: “In proportion as the bourgeoisie,
the progressive societies has hitherto been a movement i.e., capital, is developed, in the same proportion is the
from Status to Contract,” and the transition from master proletariat, the modern working class, developed—a class
and servant law to the employment contract model is often of laborers, who live only so long as they find work, and
considered an important part of that story. H.S. Maine, who find work only so long as their labor increases capital.
Ancient Law: Its Connection with the Early History of These laborers, who must sell themselves piecemeal, are a
Society, and Its Relation to Modern Ideas (London: J. commodity, like every other article of commerce, and are
Murray, 1861) at 170. However, as we discuss in Chapter 5, consequently exposed to all the vicissitudes of competi-
employment contracts have always been heavily regulated tion, to all the fluctuations of the market. Owing to the
and subject to special rules of interpretation developed by extensive use of machinery, and to the division of labor,
common law judges. See Mummé, supra note 2. the work of the proletarians has lost all individual charac-
6. H. Collins, Employment Law, 2nd ed (Oxford: Oxford ter, and, consequently, all charm for the workman. He
University Press, 2009) at 14-15. Leading works becomes an appendage of the machine, and it is only the

most simple, most monotonous, and most easily acquired H. Arthurs, “Labour Law After Labour,” in Davidov &
knack, that is required of him. Hence, the cost of produc- Langille, 13-29 at 13; and A. Davies, Perspectives on
tion of a workman is restricted, almost entirely, to the Labour Law, 2nd ed (New York: Cambridge University
means of subsistence that he requires for maintenance, Press, 2009) at chapter 2.
and for the propagation of his race.” See also K. Marx, 14. J. Rinehart, The Tyranny of Work: Alienation and the
Capital (Hamburg: 1867). For a review of Marx and the Labour Process, 2nd ed (Toronto: Harcourt Brace, 1987) at
application of his work to industrial relations and the law 40; and G. Kealey, Canada Investigates Industrialism
of work, see J. Goddard, Industrial Relations, the Economy, (Toronto: University of Toronto Press, 1973) at 14, 22.
and Society, 4th ed (Toronto: Captus Press, 2011) at
15. S. Bernstein, K. Lippel, E. Tucker & L. Vosko, “Precarious
chapter 2. See also M. Skousen, The Big Three in Eco-
Employment and the Law’s Flaws: Identifying Regulatory
nomics: Adam Smith, Karl Marx, and John Maynard
Failure and Securing Effective Protection for Workers” in
Keynes (Armonk, NY: M.E. Sharp, 2007).
L. Vosko, ed, Precarious Employment: Understanding
11. M. Weber, “Freedom and Coercion” in M. Rheinstein, ed, Labour Market Insecurity in Canada (Montreal: McGill-
Max Weber on Law in Economy and Society (Cambridge, Queen’s University Press, 2006) at 203.
MA: Harvard University Press, 1954) at 188.
16. P. Davies & M. Freedland, Kahn-Freund’s Labour and the
12. Machtinger v. HOJ Industries, [1992] 1 SCR 986 at 1003. Law, 3rd ed (London: Stevens, 1983) at 18. This passage
13. A vast amount of legal literature exists on this debate, was quoted with approval by Chief Justice Dickson of the
dating from the beginning of waged labour. A good Supreme Court of Canada in Slaight Communications Inc.
summary of some of the leading historical voices in this v. Davidson, [1989] 1 SCR 1038 at part IV.
debate is found in Labour Law Casebook Group, Labour 17. L. Panitch & D. Schwartz, From Consent to Coercion: The
and Employment Law: Cases, Materials, and Commentary, Assault on Trade Union Freedoms, 3rd ed (Toronto: Gara-
8th ed (Toronto: Irwin, 2011) at chapter 1. In particular, mond Press, 2003); and J. Fudge & E. Tucker, Labour
see the famous exchange between M. Friedman, Capital- Before the Law (Oxford: Oxford University Press, 2001).
ism and Freedom (Chicago: University of Chicago Press,
18. A number of books describe labour arbitration law in
1962) at 12-15, and C.B. MacPherson, “Elegant Tomb-
Canada, including D. Brown, D. Beatty & C. Deacon, Can-
stones: A Note on Friedman’s Freedom,” in Democratic
adian Labour Arbitration, 4th ed (Aurora, ON: Canada
Theory: Essays in Retrieval (Oxford: Oxford University
Law Book, 2006); M. Mitchnick & B. Etherington, Labour
Press, 1973) 143-56 at 143. Some recent contributions
Arbitration in Canada (Toronto: Lancaster House, 2006);
include B. Langille, “Labour Law’s Theory of Justice,” in G.
and R. Snyder, Collective Agreement Arbitration in
Davidov & B. Langille, eds, The Idea of Labour Law
Canada, 5th ed (Markham, ON: LexisNexis, 2013).
(Oxford: Oxford University Press, 2011) 101-20 at 111;


CHAPTER 2
A Framework for Analyzing

the Law of Work
II. Law Is What Law Does 18
• Describe the key components of the work law subsystem.
III. A Framework for Analysis of the Law of Work 20
• Explain how the work law subsystem interacts with the broader society A. The Work Law Subsystem 20
in which it functions. B. External Inputs and the External Feedback Loop 26
• Describe how the power, values, and goals of key actors influence the IV. Chapter Summary 29
legal rules governing employment. Questions and Issues for Discussion 31
• Identify the different legal rules, or outputs, of the three regimes of the Exercise 31
work law subsystem. Notes and References 31
• Explain how the three regimes of the work law subsystem interact with
and influence one another in ways that can affect the legal rules
produced within each regime.
I. Introduction
In Chapter 1, our survey of the topographical map of work law introduced, at a high level of
generality, the three legal regimes that comprise the main subject matter of this text—the com-
mon law of employment, regulatory standards, and collective bargaining. Dividing the law into
these three distinct regimes is a useful way for law professors and lawyers to organize and teach
the laws that govern employment in Canada. The first two regimes (common law and regulatory
standards) have traditionally been taught in “employment law” seminars using “employment law”
texts.1 The collective bargaining regime, by contrast, has usually been hived off and taught as
separate courses in “labour law,” “labour arbitration law,” and “industrial relations” and described
in law texts with similar names.2 As mentioned in Chapter 1, this text uses the labels work law
and the law of work when discussing the entire system of legal rules in all three legal regimes.3
However, compartmentalizing the laws that govern employment into the three regimes,
while useful for organizing educational materials, oversimplifies the complexity of the legal
framework that governs the work relationship in Canada. This becomes evident when we zoom
in on our map of the law of work. A closer inspection shows a far more complicated terrain, one
that cannot be so neatly compartmentalized. Continuing on with our geographical analogy, we
see that rivers flow across boundaries; inhabitants move from one part of the map to another,
only to return later; some inhabitants function in all three regimes simultaneously. The real
world of work law is a far more complex place than our discussion so far has suggested.
We need a way to understand and organize this complexity. This chapter addresses this chal-
lenge by developing a conceptual framework for the analysis of the law of work. This framework
draws a more complete map of the laws that govern work, as well as the relationship of those
laws to the broader economic, legal, political, social, and environmental context in which they
evolve and function.
17

II. Law Is What Law Does

Let’s begin with a simple lesson about legal rules. The relationship between a seller and buyer of
labour is above all else a human relationship, and human behaviour is complex. People behave
as they do for all sorts of reasons, of which formal legal rules are but one. Often, in fact, legal
rules in employment contracts and government regulations conflict with other powerful eco-
nomic, legal, political, social, and environmental forces present in society. When that occurs,
something has to give, and sometimes it is the legal rules that are cast aside.
This lesson is demonstrated in the news article excerpt presented in Box 2.1. The excerpt
describes the experience of recent immigrants working in Toronto’s Chinatown. Some were
charged a $400 fee to obtain a job that pays them only $25 per day for ten hours of work, seven
days a week. Others earn $4 per hour for a 70-hour workweek. As we learn in Part III, Ontario’s
government long ago introduced employment standards legislation that includes a minimum
wage law, rules capping maximum hours of work, and rules requiring overtime pay at a higher
hourly rate for hours worked beyond 44 hours in a week (regulation regime).4 The employment
practices described in the story clearly violate these legal rules.
Systemic violations of labour rights such as those described in Box 2.1 raise complex ques-
tions: Why would employees agree to work under conditions that violate minimum legal stan-
dards? Why does the government bother passing employment standards laws if workers and
employers are prepared to agree to conditions falling below the legal minimums? Why do some
employers violate these laws? How do those employers get away with such violations? Why isn’t
the law working?
The excerpt in Box 2.1 reminds us of a fundamental point: we should never assume that
people comply with legal rules. What matters is how a legal rule actually affects behaviour (if it
does at all) and not simply what a legal rule says. To paraphrase film character Forrest Gump,
“Law is as law does.”5 Non-compliance with legal rules is a big problem in the law of work.
A 2017 report by Professors Vosko, Tucker, and Noack found that in complaints filed and
assessed under the Ontario Employment Standards Act between 2008 and 2015, violations were
found 69 percent of the time.6 Another study found that “about 25% of all federal employers
were not in compliance with most [employment standards] obligations … and that 75% of these
employers were not in compliance with at least one [employment standards] provision.”7 Profes-
sor Harry Arthurs noted in his 2006 study of Canadian federal labour standards that this latter
figure likely understated non-compliance because it is based on employer self-reporting.8
Ignorance of laws is no doubt partially to blame for this non-compliance. Work-related laws
can be complicated and difficult to understand. But ignorance of the law is only part of the story.
As noted earlier, sometimes a legal rule is sacrificed because it conflicts with more powerful
societal rules and norms. Other times a legal rule is knowingly violated because, considering all
relevant factors, including the odds of being caught and the penalties for non-compliance, it
makes more economic sense to someone to break the law than to comply with it. Economists
refer to this type of infraction as an efficient breach.9 Efficient breaches are a common problem
with employment regulation because governments lack the resources, capacity, and often the
political will to inspect all workplaces, and many employees will not complain for fear of losing
their jobs in reprisal. If a government decides to aggressively enforce its legal rules, some
employers might respond by fleeing the reach of the law altogether by moving their business
(and the jobs) to another jurisdiction. In that case, a law designed to help workers could actually
cause their unemployment.
efficient breach: A deliberate violation of a contract or government statute owing to the belief that it is more economically
efficient to violate the legal rule than to comply with it.

Chapter 2 A Framework for Analyzing the Law of Work 19
BOX 2.1 » Recent Immigrant Workers in Toronto’s Chinatown and Labour Rights Violations
The bustling streets, sidewalks and shops of Toronto’s China- hours had exhausted her, and she quit her job. She had no
town hide a troubling reality: many of the Asian immigrants awareness of her rights as a worker until she was approached
to Canada who work in the restaurants, salons, and other by the researchers conducting the survey; the legal clinic has
businesses are subjected to exploitation and dangerous and subsequently assisted Ms. Zheng in her complaints against her
illegal working conditions. Various studies and investigative former employer.
reports have uncovered a high proportion of workers who Wei Sun was one of the eight volunteers who conducted
endure serious labour rights violations, regarding such issues the survey, which took place both on the street and via tele-
as the paying of minimum wage, hours worked per week, phone. She was quoted in the Toronto Star:
overtime, holidays, and in many cases, unsafe equipment or
working conditions. Many of the workers have worked in those kinds of
Several such issues were identified in a 2010 survey of conditions for years and they just don’t care about
workers in various industries by the Chinese and Southeast their rights. They just do whatever their bosses order
Asian Legal Clinic. The clinic issued a similar report in 2016, them to do and accept what they pay them. They
focused primarily on the restaurant industry, entitled “Sweet never challenge. … It’s shocking in Canada that
and Sour: The Struggle of Chinese Restaurant Workers.” The these people are working 70 hours a week, with an
results of this survey illustrate how recent immigrants looking average hourly wage of $4.*
for employment are commonly working overtime without
compensation, and often unaware of the laws in Ontario re- * N. Keung, “Few Aware of Labour Rights in Toronto’s Chinatown,” Toronto
Star (23 July 2010), online: <http://www.thestar.com/news/
garding maximum hours of work per week. Notably, many investigations/2010/07/23/few_aware_of_labour_rights_in_torontos_
people approached for the survey declined to take part, for chinatown.html>
fear that doing so would put their jobs at risk. Sources: Based off of “Chinese Restaurant Workers Underpaid and
Many Asian immigrants to Canada come from countries Overworked, New Report Says,” CBC News (25 April 2016), online: <https://
with very few workers’ rights, and this lack of knowledge makes www.cbc.ca/news/canada/toronto/chinese-restaurant-workers-report
them especially vulnerable to exploitation by business owners -1.3551423>; Chinese and Southeast Asian Legal Clinic, <https://csalc.ca>;
Keung, ibid.
when they arrive in Toronto or other large immigrant centres
in Canada. Because many also lack strong English language
skills, they often remain unaware of their rights, or are not able
to access legal support.
The 2010 report included statistics
based on surveys of immigrant workers,
which indicated that fewer than one in five
respondents know what Ontario’s maxi-
mum hours of work laws are; two-thirds
are unaware of their rights to overtime and
holiday pay; and four out of ten are un-
aware of the current minimum wage in the
province. For the most part, they remain
simply unaware that they have legal pro-
tections, whether or not they actually have
a written employment contract.
The report’s subjects work largely in
service-sector jobs. Sue Zheng, who ar-
rived from Fuzhou, China in 2006, is one of
the workers profiled in the 2010 report.
She describes coming to Canada with no
English language skills and finding work in
a nail salon. The 40-year-old mother of two
was desperate for work in order to feed her Many Asian immigrants to Canada come from countries with
children, but after two months the long few workers’ rights, and they are vulnerable to exploitation by employers.

We are beginning to scratch the surface of the complexity we are dealing with when we study
the law of work. If we are to make sense of how legal rules come about and why some are ef-
fective and others are not, we need a richer framework that can map this complexity. One way
to do this is to treat work law as one of many components, or subsystems, present in any com-
plex, multi-faceted society, and to then study how those subsystems interact to produce the rules
that govern work. The remainder of this chapter discusses such a framework.
III. A Framework for Analysis of the Law of Work

Treating work law as one of a variety of subsystems operating in society at any given time pro-
vides a more realistic depiction of how things actually work. It allows us to see how legal rules
relating to the labour relationship are influenced by a whole range of pressures emanating from
outside the formal confines of laws targeting the employment relationship. The framework dis-
cussed in this section helps us more fully assess the role of law in our society, explain legal rules,
and predict the impact of legal rules.10
The law of work framework is presented in Figure 2.1. It is descriptive and demonstrates the
breadth of our subject, drawing attention to the reality that the law of work is more than the sum
of its parts. Every legal rule we encounter in this text is a result of the interaction among a variety
of forces, including fierce debates, rich histories, reluctant compromises, and sometimes violent
and bloody clashes. The laws that govern work in any society emerge from this complex milieu.
Therefore, we need to understand that legal rules do not operate in a vacuum. They shape and
are shaped by the many broader social, economic, political, and environmental forces operating
in society generally at any given time.11
A. The Work Law Subsystem

As noted earlier in this chapter, the separation of laws governing employment into three distinct
regimes obscures the important interconnections among the three regimes.12 It presents an
incomplete picture of how the laws that govern employment actually function in the real world.
To obtain a fuller, more accurate view, we need to step back and view the laws that govern the
employment relationship as a distinct subsystem of the broader society in which it functions.
This subsystem is presented in the box in Figure 2.1 labelled “The Work Law Subsystem.” Since
the work law subsystem is the focus of our attention in this book, it is presented in much greater
detail and as central in the framework.
subsystem: In legal sociology, a self-contained system within the broader social system that possesses its own rules, norms, and
modes of communication. Examples include economic and market; legal; political; social, cultural, and religious; and ecological/
environmental subsystems.

FIGURE 2.1 Law of Work Framework
THE WORK LAW SUBSYSTEM

The Common Law Regime (Part II of the text)
OUTPUTS
KEY INTERNAL INPUTS RULE-MAKING KEY LEGAL
ACTORS PROCESSES INSTITUTION Employment
Power contracts
Employers • Individual Judges/courts •
• Values negotiations Torts
Individual • • •
employees Goals Civil litigation Workplace norms
The Regulatory Regime (Part III of the text, Chapters 18-24)
KEY INTERNAL INPUTS RULE-MAKING KEY LEGAL INSTITUTIONS

ACTOR PROCESS OUTPUTS
Power Government inspectors
Government • Legislative process • Protective
Values Administrative tribunals regulatory
• • standards
Goals Judges/courts legislation
INTERNAL FEEDBACK LOOP*
EXTERNAL FEEDBACK LOOP

The Collective Bargaining Regime (Part IV of the text)
KEY INTERNAL RULE-MAKING KEY LEGAL OUTPUTS

ACTORS INPUTS PROCESSES INSTITUTIONS
Collective
Power Labour tribunals bargaining
Government • Legislative process • legislation
Values Labour arbitrators •
• • Collective
Employers and Goals Collective bargaining, Judges/courts agreements
their associations strikes, and lockouts •
• • Torts/labour
Employees and Arbitration injunctions
their associations • •
Civil litigation Workplace norms
ECONOMIC AND BROADER LEGAL SUBSYSTEM POLITICAL SOCIAL, CULTURAL, AND ECOLOGICAL/
MARKET SUBSYSTEM Legal rules governing tax, trade SUBSYSTEM RELIGIOUS SUBSYSTEM ENVIRONMENTAL
Labour and other competition, immigration, Party politics, Social and cultural norms, SUBSYSTEM
EXTERNAL market forces at local, business associations, welfare, political values, religion, family, language, social Climate, access to
INPUTS regional, and global property, and constitutional law and political group dynamics, and identity natural resources,
levels (among other fields) systems politics (class, race, gender, etc.) geography
(Part III of the text,
Chapters 25-27, Part V, Chapter
39, and various online
supplemental chapters
exploring bankruptcy, pension,
and intellectual property laws)
* Legal rules produced by each of the three regimes of work law feed back into the subsystem as information and experience and can provoke changes and adaptations by the actors in all
three regimes, which can produce new outputs.

1. The Three Regimes of the Work Law Subsystem

The work law subsystem is dominated by the three traditional regimes of work law already intro-
duced. However, now we add some new layers of detail to produce a more complex and realistic
depiction of the legal system. For those new to the study of law, or work law in particular, some
of the concepts and terms used in the following description of the work law subsystem will be
new. Not to worry; as we proceed through this text, we will consider everything that follows in
greater detail and consider examples. The purpose of the discussion here is to introduce the
main components of the framework.
a. The Common Law Regime (Part II of This Text)

The key actors in the common law regime are employers and individual employees. They engage
in the rule-making process of negotiation, and their agreements produce the main output of the
regime—individual employment contracts of service. When disputes arise about those con-
tracts, they are sometimes resolved through civil litigation, which is the second rule-making
process in this regime. Civil litigation can also produce legal rules in the form of torts, another
important output. The courts (and the judges who preside over them) are the key legal institu-
tion. Judges/courts produce legal rules when they issue the contract interpretation and tort
decisions that form the essence of the common law of employment.
An additional output produced by the common law regime is workplace norms. These are
unwritten rules that nevertheless can have a great influence on how people are expected to behave
in given situations.13 Workplace norms are created over time through common experience that
creates expectations. Since things have long been done in a particular way, people expect that
those things will continue to be done in those ways. How often can employees take washroom
breaks, and do they need to ask permission? Is playful banter and horseplay between workers
tolerated or treated as harassment? Does the employer create a climate in which complaints can
be raised, or are employees too fearful to speak up? Can workers talk about personal matters or
use email or social media during working hours? Who gets first choice in vacation time or over-
time? And so on. These are examples of questions and issues that can arise at any workplace, and
yet the answers may not be written down in any document. However, workplace norms can
explain why people behave as they do, and ignoring them can create an incomplete picture of how
legal rules influence behaviour. As we learn in Part II (for example, in Chapter 9 at pages 135-36),
workplace norms are sometimes recognized by judges as “past practices,” which can create legally
enforceable contractual rights or influence the interpretation of contracts.
Another addition to our framework is internal inputs. How the key actors behave—their
bargaining strategy, their manner of communication, their propensity to resist or concede
points, to pursue conflict or to resist it, and to obey or violate legal rules—depends on their rela-
tive power, as well as their values and goals. Understanding the power dynamic is crucial to
understanding how law operates in practice. For example, the employers of recent immigrants
in Toronto’s Chinatown possess a substantial power advantage. The workers need the piddling
wages paid by the employers just to survive. Many of the workers do not qualify for any type of
public assistance. Some workers may not legally be able to work in Canada because they do not
have a work permit, so they have few other employment options. If they resist the employer, they
negotiation: Discussion between two or more people aimed at reaching an agreement.

civil litigation: The processes involved with lawsuits filed in court not involving criminal law statutes, such as legal actions
for breach of contract or torts.
workplace norms: Norms or expectations that arise in a workplace as a result of past practices or relationships that can
influence behaviour at work, even though they are not codified in contracts or statutes.

could be deported. The employers know all of this, and this gives them great power to set work-
ing conditions.
Yet not all actors who possess the power to impose their will on others exercise it in an
exploitative manner. The decision by an employer to pay a wage rate that is far below subsistence
levels reflects a value choice. Some employers pay workers more than the market requires
because they are guided by a value system based on humane and decent treatment of workers,
or because they believe higher pay will result in a more productive worker. For example, some
companies have adopted a “living wage” policy that sets wage levels at a rate that considers the
cost of living in the location where the work is performed, even though they have the bargaining
power to insist on lower wages.14 Actors’ goals also shape their decisions. Henry Ford voluntarily
adopted eight-hour workdays and doubled his workers’ wages in 1914, not only as “an act of
social justice” (e.g., values), but also because he believed doing so was necessary “so that the
business would be on a lasting foundation.” Ford believed that “low wage business is always
insecure,” and that his business depended on workers having money to buy cars.15 If we just
assume that terms of employment contracts result from free negotiation shaped by market
forces, we would be unable to explain the terms of employment at Ford in the early 20th century.
We need to consider how power, values, and goals shape the strategies of the parties who set
working conditions.
b. The Regulatory Regime (Part III of This Text)

The regulatory regime, as noted in Figure 2.1, is the domain of the government. It is the actor
that decides upon the content of the standards and enacts them into law by means of the legis-
lative process (rule-making process). Governments, in their law-making function, are also influ-
enced by internal inputs in the form of power, values, and goals. A government’s perspective on
the appropriate role of the state in regulating labour markets often shapes its goals and values as
it sets its agenda for regulatory reform, as we discuss in Chapter 3. However, sometimes govern-
ments make decisions affecting work laws for more pragmatic political reasons. For example,
the federal Conservative government imposed a ban on the use of foreign temporary workers
in 2014 by restaurant employers only after the practice attracted considerable public backlash
(see Chapter 25).16 A government’s power is a function of the political climate at a given time
and place. The greater the level of support for the government’s policy agenda from key stake-
holders, including but not limited to the electorate, the greater the capacity of the government
to implement that agenda. The output of this regime is regulatory standards legislation intended
to protect employees, examples of which are explored in Part III. The key legal institutions
responsible for implementing and enforcing that legislation include government inspectors,
expert administrative tribunals (e.g., employment standards and human rights tribunals), and
judges/courts (which are mostly responsible within the regulatory standards regime for oversee-
ing the administrative tribunals).
c. The Collective Bargaining Regime (Part IV of This Text)

Finally, the collective bargaining regime involves two distinct streams or types of rule-making
processes that produce a range of legal rules (outputs):
1. the legislative process, through which governments enact collective bargaining legisla-
tion that regulates unionization, collective bargaining, industrial disputes, and collec-
tive agreement administration; and
2. the collective bargaining process, through which unions and employers develop rules
through a mix of collective bargaining, sometimes accompanied by industrial conflict,
collective agreement administration and labour arbitration, and occasionally civil liti-
gation, involving mostly tort law.

The government is the key actor in the legislative process, whereas employees and employers,
along with their collective associations, are the key actors in the collective bargaining process.
Unions are the most common example of collective associations, but there are other non-union
forms of employee associations in Canada;17 employer associations also exist, particularly in
industries such as construction and professional sports. As in the case of the common law
regime, how the actors in the collective bargaining regime behave and what legal rules are pro-
duced through collective bargaining are influenced in large measure by the relative power of the
actors and their respective values and goals (internal inputs).18
The key legal institutions in the collective bargaining regime are expert labour tribunals
(mostly labour relations boards), arbitrators (both labour arbitrators and interest arbitrators),
and judges/courts, which are involved in policing some aspects of collective action, particularly
through the use of torts and labour injunctions to restrain strikes and picketing. Finally, the
outputs of the collective bargaining regime include (1) collective bargaining legislation; (2) col-
lective agreements between unions and employers (and sometimes employer associations), as
interpreted by labour arbitrators; (3) court-ordered torts and labour injunctions that restrict
some forms of collective bargaining - related activities; and (4) the same types of workplace
norms we discussed in relation to the common law regime.
2. The Internal Feedback Loop

A key to understanding the framework presented in this chapter lies in paying attention to how
its various components interact in an ongoing dynamic process. Two types of feedback loops
appear in Figure 2.1: (1) an internal feedback loop and (2) an external feedback loop. The inter-
nal feedback loop appears in blue and shows how the outputs of each regime “feed back” into
the other regimes as information that can influence actors’ behaviour and rule-making pro-
cesses, and eventually produce new outputs.
To demonstrate, consider an obvious example of regime interaction within the work law
subsystem. Regulatory standards, such as the minimum wage found in Canadian employment
standards legislation, regulate both individual employment contracts in the common law regime
as well as collective agreements in the collective bargaining regime. Neither type of contract can
include a wage clause that provides for less than the statutory minimum wage. Nor can either
type of contract include a term that discriminates contrary to human rights legislation, to give
another example. In these ways, the outputs from the regulatory standards regime directly influ-
ence the range of options available to the key actors and legal institutions in the other two
regimes. So we cannot fully understand the outputs of the other two regimes without acknow-
ledging the effects of the regulatory standards regime.
Similarly, the legal rules produced by the common law regime affect outputs from the other
two regimes. For example, governments have occasionally mimicked rules developed in the
labour injunction: An order issued by a judge that prohibits or restricts a union and unionized workers from engaging in
some type of collective action, such as a strike or picketing.
feedback loop: An explanatory device that demonstrates how outcomes produced by a system (e.g., legal rules produced by a
legal system) can influence other systems (e.g., the economic system) and also “feed back” into the original system as information
in a process of perpetual learning, experience, and change.

common law and incorporated them into regulatory standards. The statutory “notice of termin-
ation” requirements in Canadian employment standards legislation (discussed in Part III) are
an example; they are modelled after the long-standing common law implied contract term
requiring “reasonable notice” of termination. More fundamentally, the common law regime acts
as the default legal system. Almost every regulatory standard and every collective bargaining law
represents the government’s response to some perceived inadequacy in the common law model.
To fully understand what objective statutory laws are seeking to achieve, we need to understand
how the common law would deal with the matter in the absence of legislation.
Finally, legal rules produced by the collective bargaining regime in the form of collective
bargaining laws and collective agreement provisions influence outputs from the other regimes.
Canadian collective bargaining legislation imposes many restrictions on the freedom of employ-
ers and individual employees to contract that would otherwise prevail in the common law
regime. An obvious example is that in the common law, a strike by workers is a breach of con-
tract and a tortious conspiracy, but collective bargaining legislation shields workers from those
actions by protecting a limited right to strike in some circumstances.19 Also, many modern-day
statutory standards mimic terms that unions and employers had originally included in collective
agreements. For example, the roots of present-day maximum hours legislation are firmly
embedded in the Nine-Hour Movement organized by Canadian unions of the early 1870s, as
well as hours of work provisions that appeared later in collective agreements.20 The three
regimes of work law “learn” from one another. See Box 2.2 for another example of how collective
bargaining outputs can influence what occurs in the common law regime.
BOX 2.2 » An Example of the Internal Feedback Loop: The Dofasco Way
Industrial relations scholars have shown that collective agree- cure retirement with a good pension and health
ments, bargained within the collective bargaining regime, influ- benefits.
ence the terms of individual employment contracts in non-union It was all part of a contract called The Dofasco Way,
workplaces (within the common law regime). This is known as the package of welfare programs leavened with a
the spillover effect of collective bargaining.* healthy dose of fear that kept the company union-
Some non-union employers pay their employees more than free for 75 years, creating what employees always felt
market forces alone would dictate and offer other benefits, was a “family atmosphere” where management really
including “grievance procedures” that attempt to mirror what cared about them.
unions bargain into their collective agreements, in order to Today, after taking early retirement because of the
remove or reduce the incentive for their employees to join way his body was worn down in fulfilling his part of
unions. The spillover effect is an example of the operation of that contract, Perkins and several hundred other
the internal feedback loop: outputs from the collective bargain- Hamilton Dofasco veterans fear the old way is dead
ing regime become inputs in the common law regime, influenc- and the deal has been summarily changed.
ing the internal inputs of the actors there, and ultimately the “They gave us a package when he retired and now
terms of employment contracts and workplace norms within they’ve decided across the board to take away those
the common law regime. The following excerpt from a news- benefits,” said Perkins’ wife, Bonnie Hamilton. “Some-
paper story provides a glimpse into this process. thing’s just not right here. If they get away with this,
what’s going to be next?”
Robert Perkins thought he had a deal. He gave Do- Dating back to 1937, The Dofasco Way combined
fasco 32 years of his life in the grit and noise of the welfare initiatives such as recreation programs, con-
Hamilton steel mill. In exchange he was to get a se- certs, picnics and a massive Christmas party with one
Nine-Hour Movement: A social movement peaking in the early 1870s seeking a legislated maximum nine-hour workday.
spillover effect: The effects that collective agreement settlements bargained by unions and employers have on individual
employment contracts in non-union workplaces.

of Canada’s first profit-sharing plans. Called The Fund, out of their Hamilton plants by creating a sense of
the plan gave industrial workers an undreamt of mutual interest between workers and management.
promise of security in their old age. That promise, “My father felt a union created unrest in a com-
however, was always coupled with a far from pany,” Frank Sherman Jr. recalled in a 2008 Spectator
subtle threat—join a union and it could all be taken interview. “He felt if people working in his company
away. were doing as well as people in unions, why would
That combination of threat and promise worked they need one?”†
for 75 years, but today, many veteran workers fear * R. Freeman and J. Medoff, What Do Unions Do? (New York: Basic Books,
The Dofasco Way is dying a “death of a thousand cuts,” 1984); D. Neumark and M. Wachter, “Union Effects on Nonunion Wages:
as the steel industry concentrates into a few firms Evidence from Panel Data on Industries and Cities” (1995) 49:1 Indus &
with a global reach. … Lab Rel Rev 20; and L. Kahn, “Union Spillover Effects on Organized Labor
Markets” (1980) 15:1 J Hum Resources 87.
The Dofasco Way was rooted in the visceral hatred
company founders Clifton and Frank Sherman had † S. Arnold, “The Dofasco Way,” Hamilton Spectator (2012), online: <http://
www.thespec.com/news-story/2129793-the-dofasco-way/>.
toward labour unions—an evil they sought to keep
If we study work law in silos, as three distinct regimes that do not interact, we would miss the
relationships described in Box 2.2. If we look only at the collective bargaining regime, we will
not even notice the benefits Dofasco gave its employees as a union avoidance strategy and,
therefore, the true effects of collective bargaining will be underestimated. If we study only the
common law regime, we might wrongly conclude that Dofasco employees used superior nego-
tiating skills to bargain high wages and a generous benefit and retirement package, or that their
high productivity justified these generous contractual entitlements. Only by recognizing that the
regimes are interconnected through a process of ongoing information feedback will we discover
the full story of how legal rules emerge and influence labour market outcomes.
B. External Inputs and the External Feedback Loop

So far, we have looked only at what goes on within the work law subsystem itself—at how the
laws that govern employment are created and how the three regimes of work law interact with
one another. Now it is time to cast our gaze outward to the broader social system within which
the work law subsystem functions. As noted earlier, the work law subsystem does not operate in
isolation from the rest of society. It is influenced by its external environment, and the legal rules
it produces can also influence that external environment. These interactions are demonstrated
in Figure 2.1 by the purple arrows that flow out of the work law subsystem to the external inputs,
and from the external inputs back into the work law subsystem. These arrows indicate the ex-
ternal feedback loop component of our framework.
1. External Inputs

We can group these external forces into five distinct subsystems that function within every
advanced society. We can call these external inputs because they affect the development of work
laws from outside the work law subsystem itself (they involve forces that are not directly “about”
work laws but nevertheless affect work laws).
• Economic and market subsystem. Work law regulates labour markets. Its objective, beyond
protecting workers and regulating conflict, is to influence key labour market indicators,
such as labour costs, employment levels, labour market skills and training, and labour
market adjustment and flexibility. Labour markets are, in turn, influenced by other
union avoidance: A management strategy designed to reduce the risks that employees will join unions.

domestic and foreign markets, including money markets, trade markets, energy markets,
transportation markets, product and consumer markets, and securities markets. Changes
in these other markets can influence what happens within the work law subsystem.
For example, as competition for an employer’s goods intensifies, the price it can charge
for those goods may fall, producing a lower profit margin. This consumer market change
may cause the employer to demand wage concessions from employees and influence the
amount of wages and benefits the employer can afford to pay its employees. Some of the
employers in Toronto’s Chinatown, described in Box 2.1, above, are operating in a highly
competitive global industry in which profit margins are very low and competition comes
from low-wage countries such as Bangladesh, Honduras, and China. The market pressure
on these employers to keep labour costs low is intense. These market pressures produce
a strong incentive for the employers to cheat on compliance with Canadian employment
standards laws.
• Broader legal subsystem. The laws that govern work are part of a large, complex, and
interrelated legal system. The laws we are interested in are influenced by developments
in many other legal fields, including tax, trade, immigration, competition, business, se-
curities, criminal, intellectual property, social security, privacy, property, constitutional,
tort, criminal, and contract law. We are interested in these broader legal fields insofar as
they have important effects on how labour markets function.21
Consider some examples. Immigration laws are not specifically concerned with pro-
tecting vulnerable employees, but they influence who can have a job in Canada, as well
as the conditions under which new immigrants work. Laws that govern privacy in
Canada affect the rights of employers and employees even though they have much
broader application. Criminal law has played an important role in controlling worker
resistance to employer power in Canada. Intellectual property laws regulate ownership
of the products of work. Constitutional law determines which levels of government have
jurisdiction to enact work laws and restricts the range and substance of laws governments
can pass. Free trade laws that reduce tariffs and quotas influence the competitiveness of
Canadian labour markets and investment decisions in ways that can affect relative bar-
gaining power vis-à-vis employers and workers.22
The preceding examples illustrate how laws that do not specifically target the employ-
ment relationship nevertheless have a substantial impact on that relationship and on
labour market functioning more generally. We cannot fully understand the law’s role in
regulating labour markets without considering these laws in addition to those that are
specifically targeted at protecting vulnerable employees. Therefore, our exploration of
regulatory standards in Part III will include (in Chapters 25-27 and 39) consideration of
government legislation that affects the behaviour of labour market actors even though
protecting vulnerable employees is not its central purpose.
• Political subsystem. The law of work is a function of the broader political economy within
which it functions.23 The political belief system and the distribution of political power
during a particular time shape how a government behaves as a lawmaker and an em-
ployer. Proposed changes to work laws are often included in political campaigns as a way
to attract voters. Politicians who prefer little regulation of labour markets have vastly
different ideas about the role of the state than do politicians who favour greater labour
market regulation, and these debates often play out in work law reforms as political winds
shift.24 We will explore the dominant political perspectives that have often shaped debates
about work law in Chapter 3.
free trade: A term used to describe a trade law policy characterized by low or zero trade tariffs and low or zero quotas on the
amount of goods that flow between national borders.

• Social, cultural, and reli-

gious subsystem. Social,
cultural, and religious
values are powerful
determinants of human
actions, and they have
key implications for the
law of work.25 The rich
fields of “sociology of
work,” “industrial sociol-
ogy,” and “law and soci-
ety” study how legal rules
and the tendency for
them to be obeyed (or
Demonstrators in Montreal took part in a protest in 2013
disobeyed) reflect social
against Quebec’s proposed Values Charter.
norms and values.26 As
noted above, employers of the workers in Toronto’s Chinatown are able to ignore employ-
ment standards laws in part because the workers lack the language skills and social sup-
port mechanisms that would enable them to resist this form of exploitation. The
organizations mentioned in Box 2.1 that assist the new immigrants attempt to build up
these social networks as part of a broader strategy in pursuit of greater levels of legal
compliance. Consider, as another example, the Quebec government’s recent ban on the
wearing of religious symbols at work by public sector workers. This law is rooted in cul-
tural and religious tensions within Quebec and cannot be understood without careful
consideration of those tensions.27
• Ecological/environmental subsystem. The types of labour market activities that are feasible
are influenced by simple geography (e.g., ocean communities have fisheries and ports,
mountain communities have skiing) and access to natural resources (think forestry and
mines). Climate can affect the strategies of work law actors in simple ways, such as when
a union attempts to coordinate a labour dispute and the accompanying picketing for the
balmy summer months rather than the frigid winter months. More fundamentally, cli-
mate change poses substantial challenges for labour markets, and work law may need to
adapt to respond in the years to come.28
These other subsystems are described as external inputs in our framework because, although
they are not directly related to legal rules that govern the labour relationship, they can each affect
the types of work laws governments enact; the perspectives and reasoning applied by tribunals,
arbitrators, and judges; and the behaviour, strategies, power, values, and goals of the actors
within the work law subsystem. And the influence can flow in both directions, as demonstrated
in Figure 2.1 by the external feedback loop represented by the purple feedback arrows flowing
out of the work law subsystem on the right side of the figure to the external inputs, and then
back into the work law subsystem.
2. The External Feedback Loop

We will consider how the external feedback loop influences the development of the law at vari-
ous points in the text. However, to provide a quick example, consider the history of human
rights legislation in Canada, which will be explored in greater detail in Part III. In important
early cases within the common law regime, judges refused to recognize a tort of discrimination
with the result that, within that regime, it is lawful for employers to discriminate against job
applicants and employees.29 Not surprisingly, an outcome of the common law regime was

employment discrimination. Women were paid less than men; people were refused employment
because of their religion; Chinese and non-white workers were treated worse than white work-
ers; and so forth.
This output of the common law regime was noted within the broader Canadian society, and
it created controversy, social division, unrest, and exclusion. Over time, as social and cultural
values evolved, more Canadians came to recognize these blatantly discriminatory practices as
unjust. These sentiments eventually were reflected in political discourse, leading to the enact-
ment of “human rights” legislation (within the regulatory standards regime). By the 1940s,
legislation had been introduced in Canada prohibiting discrimination in employment on the
basis of such grounds as race, creed, colour, nationality, ancestry, and place of origin. In
the 1950s, gender was added as a prohibited ground, followed by disability and family status in
the 1980s.
Sexual orientation was added to Quebec’s Charter of Human Rights and Freedoms as a pro-
hibited ground of discrimination in 1977, but it was not until 1986 that the next province
(Ontario) added sexual orientation to its Human Rights Code. Other provinces followed, but
some held out, including Alberta and Prince Edward Island, which continued to permit dis-
crimination in employment against gay and lesbian workers until 1998. In that year, the Su-
preme Court of Canada decided the case of Vriend v. Alberta, in which it ruled that Alberta’s
human rights legislation violated the Canadian Charter of Rights and Freedoms by not including
sexual orientation as a prohibited ground.30 This constitutional law decision effectively required
those provinces that had not already done so to add sexual orientation to the list of prohibited
grounds of discrimination in their human rights legislation.
This (very simplified) recounting of the history of human rights legislation demonstrates
the analytical contribution of the external feedback loop in our framework. For decades,
employment discrimination was lawful in Canada. However, changes within the social, cul-
tural, and religious subsystem, in the form of growing intolerance of blatant labour market
discrimination, undermined the sustainability of this discriminatory legal model. Politicians
picked up on this movement (within the political subsystem) and began calling for govern-
ment intervention in the labour market in the form of new regulatory standards banning some
forms of employment discrimination. However, not all forms of discrimination were consid-
ered equally abhorrent. It took much longer for social and political pressures to build for a
prohibition on sexual orientation discrimination to be introduced. Not until a major event
occurred within the broader legal subsystem did a prohibition on sexual orientation in Canada
become universal.
The external feedback loop is an analytical tool that draws our attention to the crucial fact
that laws are a function of the broader social system in which they exist, and that laws involve
an evolutionary process. They are not static. This text will regularly challenge the reader to step
back and consider the legal rules in this broader context. This way, we can better understand
how we got to the present point, and perhaps also better predict where we are headed.
IV. Chapter Summary

This chapter introduced a framework for analyzing the law of work. This framework represents
an important analytical tool and a conceptual model for organizing the content that will follow
in the remainder of the text. The key insight is that the laws that govern work are part of a com-
plex system that comprises economic, legal, political, social, cultural, religious, and ecological/
environmental subsystems. We need to consider the law of work in this context in order to have
a comprehensive understanding of the forces that influence and shape it. This framework will
make more sense to you (hopefully!) as we progress through the text.

FIGURE 2.2 Law of Work Framework Worksheet

OUTPUTS
Power contracts

• • standards


Collective
• • Collective
Employers and Goals Collective bargaining, Judges/courts
their associations strikes, and lockouts agreements
• • •
Employees and Arbitration Torts/labour
their associations • injunctions
Civil litigation •
Workplace norms
MARKET SUBSYSTEM SUBSYSTEM RELIGIOUS SUBSYSTEM ENVIRONMENTAL
EXTERNAL SUBSYSTEM
INPUTS


1. What are internal inputs, and how do they influence the outputs of the common law and
collective bargaining regimes?
2. Give an example of how a legal rule produced by the regulatory standards regime affects
the outputs of the common law or collective bargaining regime through the operation of
an internal feedback loop.
3. Describe the two rule-making processes within the collective bargaining regime.
4. Explain the relevance of “efficient breach” in the context of work law.
5. The various subsystems identified as external inputs in the law of work framework pre-
sented in this chapter have all attracted considerable scholarly attention in their own right.
You may have taken other non-law courses that study work and employment. Link the
following academic disciplines to an appropriate external subsystem:
• environmental justice,
• political science/political economy,
• law and society,
• labour market economics,
• sociology of work,
• work and gender, and
• labour history.
EXERCISE
Using the law of work framework worksheet in Figure 2.2, list factors in the “External Input”
boxes that you believe contributed to the poor working conditions experienced by the recent
immigrants to Toronto described in Box 2.1.

1. See, e.g., G. England, Individual Employment Law, 2nd ed combine all three regimes are more often entitled “labour
(Toronto: Irwin, 2008). AND employment law”: see, e.g., Labour Law Casebook
2. See, e.g., G. Adams, Canadian Labour Law, 2nd ed Group, Labour and Employment Law: Cases, Materials,
(Aurora, ON: Canada Law Book, 1993); and M. Mitchnick and Commentary, 8th ed (Toronto: Irwin, 2011). This is
& B. Etherington, Labour Arbitration in Canada (Toronto: the first book in Canada to adopt the shorter monikers
Lancaster House, 2006). The practice of separating the “work law” and “law of work” to describe all three regimes,
three regimes into “employment law” and “labour law” was but authors in other countries have done so: M. Crain, P.
not universally adopted in Canada. For example, Profes- Kim & M. Selmi, Work Law: Cases and Materials, 2nd ed
sors Harry Glasbeek, Eric Tucker, and Judy Fudge of (New Providence, NJ: LexisNexis, 2010); and R. Owens, J.
Osgoode Hall Law School long taught and organized their Riley & J. Murray, The Law of Work, 2nd ed (South Mel-
teaching materials on the basis that the three regimes bourne: Oxford University Press, 2011).
needed to be understood as a coherent web of rules and 4. Employment Standards Act, 2000, SO 2000, c. 41, Part VII
not as distinct subfields. See H. Glasbeek, J. Fudge & E. (“Hours of Work and Eating Periods”), Part VIII (“Over-
Tucker, Labour Law (Toronto: Osgoode Hall Law School, time Pay”), and Part IX (“Minimum Wage”).
York University, 2007-8). 5. The character Forrest Gump in the movie Forrest Gump
3. In Britain and much of Europe, the term labour law is used (1994) said: “Stupid is as stupid does.” See D. Doorey,
to describe all three regimes that govern employment “Harry and the Steelworker (or Teaching Labour Law to
(common law, regulatory standards law, and collective bar- Non-Law Students)” (2008) 14 CLELJ 107.
gaining law): see, e.g., H. Collins, K. Ewing & A. McCol- 6. L. Vosko, A. Noack & E. Tucker, Employment Standards
gan, Labour Law: Text and Materials, 2nd ed (Oxford: Enforcement: A Scan of Employment Standards Complaints
Hart, 2005). In Canada and the United States, texts that and Workplace Inspections and Their Resolution Under the

Employment Standards Act, 2000 (March 2016) at 29, and norms that shape behaviour beyond formal contract
online (pdf): <https://cirhr.library.utoronto.ca/sites and state-based law. In the work context, these ideas are
/cirhr.library.utoronto.ca/files/research-projects/Vosko%20 reflected in a rich literature on industrial pluralism. See,
Noack%20Tucker-%206A%20-ESA%20Enforcement.pdf>. e.g., H. Arthurs, “Understanding Labour Law: The Debate
7. Federal Labour Standards Review, Fairness at Work: over ‘Industrial Pluralism’” (1985) 38 Curr Legal Probs 83;
Federal Labour Standards for the 21st Century (Ottawa: S. Henry, “Factory Law: The Changing Disciplinary Tech-
Human Resources and Skills Development Canada, 2006) nology of Industrial Social Control” (1982) 10 Intl J Soc L
at 192. The problem of high non-compliance with work 365; and Dunlop, supra note 10 at 7-18 for a discussion of
laws is not a distinctly Canadian problem. On the problem the “web of rules” that shape workplace behaviour.
of non-compliance in the United States, see D. Weil, 14. A vast literature exists on “living wage” campaigns and pol-
“Implementing Employment Regulation: Insights on the icies. For a review, see D. Doorey, “Mapping the Ascen-
Determinants of Regulatory Performance,” in B. Kaufman, dance of the ‘Living Wage’ Standard in Non-State Global
ed, Government Regulation of the Employment Relationship Labour Codes” (2015) 6 Transnat’l L Theory 435; and L.
(Madison, WI: Industrial Relations Research Association, Glickman, A Living Wage (Ithaca, NY: Cornell University
1997) at 429. Press, 1997). A recent example involves the company
8. Federal Labour Standards Review, supra note 7 at 191-92. Hennes and Mauritz (H&M), the world’s second-largest
clothing retailer, vowing to implement a “living wage”
9. R. Posner, Economic Analysis of Law, 5th ed (New York:
policy throughout its global supply chain. See “H&M Fails
Aspen, 1998) at 131; and C. Goetz & R. Scott, “Liquidated
to Pay Factory Workers Living Wages Advocate Groups
Damages, Penalties, and the Just Compensation Principle:
Allege,” Global News (24 September 2018), online: <https://
A Theory of Efficient Breach” (1977) 77 Colum L Rev 554.
globalnews.ca/news/4480705/hm-factory-workers-wages>.
10. The framework developed in this chapter draws on a long
15. H. Ford, My Life and Work (Garden City, NY: Doubleday,
and rich history of systems approaches to law and, in par-
1922) at chapter VIII. The full quotation reads: “Many
ticular, work on industrial relations systems developed by
employers thought we were just making the announce-
John Dunlop (Harvard University) and later adapted to the
ment because we were prosperous and wanted advertising
Canadian setting by Alton Craig (University of Ottawa):
and they condemned us because we were upsetting
J. Dunlop, Industrial Relations Systems (New York: Henry
standards—violating the custom of paying a man the
Holt, 1958); and A. Craig & N. Solomon, The System of
smallest amount he would take. There is nothing to such
Industrial Relations in Canada, 5th ed (Scarborough, ON:
standards and customs. They have to be wiped out. Some
Prentice Hall, 1996). The influential 1969 Woods Task
day they will be. Otherwise, we cannot abolish poverty. We
Force on Labour Relations in Canada adopted the term
made the change not merely because we wanted to pay
industrial relations systems, assigning it this meaning: “the
higher wages and thought we could pay them. We wanted
complex of market and institutional arrangements, private
to pay these wages so that the business would be on a
and public, which society permits, encourages, or estab-
lasting foundation. We were not distributing anything—we
lishes to handle superior-subordinate relationships
were building for the future. A low wage business is always
growing out of employment and related activities.” See The
insecure.”
Report of the Task Force on Labour Relations (Ottawa:
Queen’s Printer, 1969) at 9. The industrial relations systems 16. See L. Goodman, “Jason Kenney Suspends Restaurants
model drew on insights from broader systems theory. See from Scandal-Plagued Temporary Foreign Worker
especially T. Parsons & N. Smelser, Economy and Society: A Program” National Post (24 April 2014), online: <http://
Study in the Integration of Economy and Social Theory news.nationalpost.com/news/canada/canadian-politics/
(London: Routledge, 1956); and N. Luhmann, The Differ- jason-kenney-suspends-restaurants-from-scandal
entiation of Society (New York: Columbia University Press, -plagued-temporary-foreign-worker-program>.
1982). See also R. Nobles & D. Schiff, Observing Law 17. See, e.g., D. Taras & B. Kaufman, “Non-Union Employee
Through Systems Theory (Oxford: Hart, 2013). Representation in North America: Diversity, Controversy,
11. H. Arthurs, Law and Learning: Report of the Consultative and Uncertain Future” (2006) 37 Indus Rel J 513.
Group on Research and Education in Law (Ottawa: Social 18. See Craig & Solomon, supra note 10 at 8-10; and R.
Sciences and Humanities Research Council of Canada, Chaykowski, “Collective Bargaining: Structure, Process,
1983) at 59. See also Doorey, supra note 5. and Innovation,” in M. Gunderson, A. Ponal & D. Taras,
12. B. Langille, “Labour Law Is a Subset of Employment Law” eds, Union-Management Relations in Canada, 5th ed
(1981) 31 UTLJ 200. (Toronto: Pearson, 2005) at 257.
13. This is a key insight of legal pluralism, a strand of legal 19. Another example involves so-called yellow dog contracts,
theory that draws attention to the many sources of rules which are legal under the common law regime based on

freedom of contract but are prohibited by Canadian labour of Responsive Workplace Law” (2012) 50 Osgoode Hall LJ
relations legislation. A yellow dog contract was a contract 47; and L. Panitch & D. Schwartz, From Consent to Coer-
term that required an employee to refrain from joining a cion: The Assault on Trade Union Freedoms, 3rd ed
union as long as they were employed with a particular em- (Aurora, ON: Garamond, 2003).
ployer, and it permitted the employer to fire the employee 25. See, e.g., H. Krahn, G.S. Lowe & K.D. Hughes, Work,
if the term was breached. Modern labour legislation pro- Industry, and Canadian Society, 6th ed (Toronto: Thomson
hibits contract terms that prohibit an employee from Nelson, 2011).
joining a union.
26. See, e.g., the periodical Work, Employment, and Society
20. See D. Morton, Working People, 5th ed (Montreal and published by Sage Publications: <http://www.sagepub.com/
Kingston: McGill-Queen’s University Press, 2007) at 21-25. journals/Journal201568/title>.
21. The argument that “labour law” encompasses the bundle of 27. See R. Lau, “Quebec’s Proposed Religious Symbol Ban for
laws that have important effects on labour markets has Public Workers Fueled by Specific Symbols: Study” Global
been made by H. Arthurs, “Charting the Boundaries of News (2018), online: <https://globalnews.ca/news/4727065/
Labour Law: Innis Christie and the Search for an Integrated quebec-religious-symbol-ban-study>; and “Charter of
Law of Labour Market Regulation” (2011) 34 Dal LJ 1. Quebec Values Would Ban Religious Symbols for Public
22. See the discussion in A. Jackson, Work and Labour in Workers,” CBC News (2013), online: <http://www.cbc.ca
Canada: Critical Issues, 2nd ed (Toronto: Canadian Schol- /news/canada/montreal/charter-of-quebec-values-would
ars’ Press, 2009) at 248-53; R. Grinspun & R. Kreklewich, -ban-religious-symbols-for-public-workers-1.1699315>.
“Consolidating Neoliberal Reforms: ‘Free Trade’ as a Con- 28. See C. Lipsig-Mummé, ed, Climate@Work (Halifax: Fern-
ditioning Framework” (1994) 43 Stud Pol Econ 33; and K. wood, 2013); and D. Doorey, “Just Transitions Law:
Banks, “Must Canada Change Its Labour and Employment Putting Labour Law to Work on Climate Change” (2017)
Laws to Compete with the United States?” (2013) 38 30 J Envtl L & Prac 201.
Queen’s LJ 419.
29. Christie v. The York Corporation, [1940] SCR 139; and
23. See Arthurs, supra note 21. Seneca College v. Bhadauria, [1981] 2 SCR 181.
24. F. Martinello, “Mr. Harris, Mr. Rae, and Union Activity in 30. Vriend v. Alberta, [1998] 1 SCR 493, 156 DLR (4th) 385.
Ontario” (2000) 26 Can Pub Pol’y 17; D. Doorey, “A Model


CHAPTER 3
Key Perspectives That Shape

the Law of Work
II. The Main Perspectives That Shape the Law of Work 38
• Describe the five key perspectives that have dominated debates and
A. The Neoclassical Perspective 38
thinking about the role of law in governing work relationships in
B. The Managerialist Perspective 41
Canada.
C. The Industrial Pluralist Perspective 43
• Recognize how the dominant perspective in political and public D. The Critical Reformist Perspective 46
discourse can influence the form and content of work laws. E. The Radical Perspective 47
• Describe how the dominant perspectives have changed in Canada over III. Chapter Summary 48
time. Questions and Issues for Discussion 48
Exercises 49
Notes and References 49
I. Introduction
According to the Fortune 500 rankings of American corporations, the fiscal 2017 profits for
Wal-Mart Stores (Walmart) were just over US$13.5 billion, making it one of the most profitable
corporations in history.1 Walmart paid its CEO, Doug McMillon, $22.4 million in compensation
that year.2 At the same time, the median Walmart retail employee earned about $19,177 in 2017.
That means that McMillon earned 1,188 times what the median Walmart employee earned that
year.3 The law in both Canada and the United States requires Walmart to pay its employees at
least a minimum wage set by the government, even if Walmart would like to pay its employees
less and those employees were prepared to work for less. However, in neither country does the
law impose a mandatory ceiling on employee compensation.
Why do our governments impose legal floors on wages, but not legal ceilings? The answer is
that minimum wage laws protect “vulnerable workers” who might be taken advantage of by
employers owing to their lack of bargaining power. If there were no minimum wage, many
employers currently paying that rate would pay their employees less provided they were able
to attract workers who need jobs and are willing to work for less. The minimum wage repre-
sents a government’s rejection of market forces as a mechanism for setting wages for low-
income workers. The government is essentially saying, “We don’t trust labour market forces and
freedom of contract to produce an acceptable wage, given the standard of living we want for
our citizens.” Governments have not been concerned about maximum wages, because high-
income workers have sufficient bargaining power to look after their own interests. Very
high income has not typically been considered a social and economic problem, whereas very
low income often has.
However, not everyone agrees that there should be a minimum wage, and some think there
should be a maximum wage.4 Whenever a Canadian government raises the minimum wage,
35

complaints arise from business groups that the move will “cost jobs,” countered by worker advo-
cates who reject those claims or argue that the increase is too small. Both sides in this debate
point to studies they claim support their position. Others argue that minimum wage policy is
about decency and fairness, not economics. There is no “correct” answer to the question of
whether governments should regulate wages. There are only arguments for and against that
regulation based on different perspectives, which are explored in Box 3.1.

Is the Minimum Wage a Good Policy?
The answer to the question above depends on a person’s per- bined impact would reduce income inequality. In a
spective. Whether a minimum wage should exist and the level time when governments feel that their budgets are
at which such a wage should be fixed are among the many constrained, this is a policy approach to address and
interesting debates that arise within the law of work. We will reduce income inequality that is crucial and
explore these debates in greater detail in Part III. Attitudes and timely.†
opinions vary widely. Consider the range of opinions reflected
in the following quotations from recent Canadian debates over From “Fairness at Work,” a government-commissioned study
proposed increases to minimum wage levels: of federal employment standards laws in Canada:
From the Fraser Institute, a conservative Canadian think
tank that advocates on behalf of corporate interests for limited In the end, however, the argument over a national
government regulation in labour markets: minimum wage is not about politics and economics.
It is about decency. Just as we reject most forms of
Increasing British Columbia’s minimum wage to child labour on ethical grounds, whatever their eco-
$10.25 an hour could lead to a loss of more than nomic attractions, we recoil from the notion that in
52,000 jobs. When governments impose high labour an affluent society like ours good, hard-working
costs on businesses, employers react by hiring fewer people should have to live in abject poverty.‡
workers and reducing the number of hours employ-
ees work.* * Fraser Institute, “BC’s $10.25 Minimum Wage Could Cost More Than
52,000 Jobs and Reduce Opportunities for Young Workers” (29 April
From the Wellesley Institute, a think tank that advocates for 2011), online (news release): <http://www.fraserinstitute.org/research
better health in urban centres: -news/news/display.aspx?id=17461>.
† S. Block, “Who Is Working for Minimum Wage in Ontario?” (October
An increase in the minimum wage will raise the floor 2013), executive summary, online (pdf): Wellesley Institute <http://www.
for all Ontario employees. This increase will have a wellesleyinstitute.com/wp-content/uploads/2013/10/Who-Makes
-Minimum-Wage.pdf>.
positive impact on those working for minimum wage
and other low wage workers. It could also transfer ‡ H. Arthurs, Fairness at Work: Federal Labour Standards for the 21st Century
(Ottawa: Human Resources and Skills Development Canada, 2006) at
income from shareholders to employees. The com-
247.
In making decisions about what laws to enact, governments are influenced by their perspec-
tives on the role of markets, governments, management, unions, ethics, and power in society and
in the workplace. In this way, how a society governs its labour markets is influenced by the pol-
itical economy in which its legal rules are produced. Do judges and citizens, and the politicians
they elect, trust that labour markets will produce desirable outcomes? Do existing legal rules
give preference to some interests over others, and, if so, is this distribution of rewards just?
Would a different set of preferences be preferable? The answers to these sorts of questions will
influence the extent and form of legal rules that emerge to govern work in any society. Therefore,
as we learn about these legal rules, we need to be alert to the dominant modes of thinking, or
perspectives, used to justify legal rules.

Chapter 3 Key Perspectives That Shape the Law of Work 37
Alexandria Ocasio-Cortez attending the third annual Women’s March

in January 2019.
For example, one perspective (perspective A) might view the vast difference between the pay
of Walmart’s CEO and the median pay of Walmart store employees as a healthy and normal
result of market forces. The CEO is “worth” over $22 million annually, while the average retail
employee is “worth” $10 per hour (for example) because that is what the market dictates for
these workers. A perspective A supporter might recall fondly the famous speech by the fictional
character Gordon Gecko (played by actor Michael Douglas) in support of free market forces in
the 1987 movie Wall Street, in which he argued that “greed, for lack of a better word, is good”
because it drives ingenuity and encourages hard work.5
Another perspective (perspective B) might view the vast gap between executive pay and
average worker pay as a failure of the market-based model. While the CEO can afford to live in
a gated mansion with security, yachts, a personal staff, and expensive cars, his employees rely on
food banks and public subsidies to feed their children and pay their rent.6 A perspective B sup-
porter might nod along when New York Congresswoman Alexandria Ocasio-Cortez argues that
“a system that allows billionaires to exist” is immoral in a country where many working people
have no access to health care and there is mass poverty,7 or when US Senator Bernie Sanders
tweets:

Do you know how rich a billionaire is? Let’s say you earn $50k/year & save every. single. penny.
After 20 years, you’d have saved $1 million. After 200 years, you’d be dead, but would have saved
$10 million. Only after 20,000 years(!!!), would you have saved $1 billion.8
If perspective A dominates contemporary social and political thinking, then we should ex-
pect few if any new laws to be enacted to address the income gap. However, if perspective B
dominates, then the vast difference between executive and average worker pay would be per-
ceived as a recipe for an unhealthy and economically and politically unstable society. We might
therefore anticipate a new law designed to transfer more wealth from executives down to
average employees.
The varying perspectives on the appropriate role of law in governing work discussed in this
chapter can influence not only the laws governments enact but also the actions, decisions, and
strategies of the other actors who help shape work laws (including employees, employers,
unions, and employer associations). We need to be alert to the background modes of thinking
that shape the actions and laws we will study in this text. Therefore, in this chapter, we introduce
the dominant perspectives that have shaped the development of the law of work in Canada. This
exercise will give us another important tool through which to analyze the laws we will discuss
in the remainder of the text.
II. The Main Perspectives That Shape the Law of Work

Five key perspectives have shaped the debates surrounding the legal regulation of the labour
relationship in Canada (and elsewhere):9
1. The neoclassical perspective.

2. The managerialist perspective.
3. The industrial pluralist perspective.
4. The critical reformist perspective.
5. The radical perspective.
These perspectives are summarized in Table 3.1. This taxonomy no doubt oversimplifies the
complexity and richness of each of the perspectives, but it is useful for our purposes here. In
practice, the boundaries between the perspectives are more blurred. Individuals can move
between perspectives from argument to argument, or over their lifetimes. Some laws cannot be
neatly fit into just one of the categories. However, our objective is simply to introduce and iden-
tify the dominant strands that have prevailed in work law policy debates over the years. As we
proceed through the text, we will occasionally note how legal policies have reflected, or been
influenced by, shifts in the dominant perspective.
A. The Neoclassical Perspective

The neoclassical perspective is an economics-based view of work law based on the assumption
that labour markets operate generally in the same manner as markets for other goods—labour
is a commodity like all other commodities.10 Neoclassicists assume that labour markets are
perfectly competitive, or nearly so. We will leave it to the economists to explain the details of the
neoclassical economic model.11 Here, we are only concerned with introducing at a general level
how the neoclassical perspective has influenced the law of work.
neoclassical perspective: An economics-based view of the law of work based on the ideal of a perfectly competitive labour
market. It rejects government intervention in labour markets and collective bargaining and argues that employers and individual
employees should set working conditions under a system of freedom of contract.

TABLE 3.1 Perspectives on the Law of Work

Perspective Labour Markets Employment Regulation Unions/Collective Bargaining
Neoclassical • Labour markets are presumed to be • Regulation artificially raises costs of • Unions are harmful labour cartels
perfectly competitive and efficient. labour above optimal market levels that artificially raise labour costs and
and introduces rigidities, with harm- reduce efficiency, with harmful
• Unfettered labour markets produce ful social and economic economic and social consequences.
an optimal allocation of resources. consequences.
Managerialist • Labour market forces alone should • Regulation is largely unnecessary, • The desire of workers to support
not determine working conditions if since employers have an economic collective bargaining indicates a
they result in conditions that do not interest in treating workers fairly. failure of management.
maximize employee motivation and
• If necessary to deal with bad • Collective bargaining introduces
satisfaction.
employers, standards should be set harmful rigidity and should be
at a low enough level that they do resisted. However, if employees
not impose undue rigidity and costs choose unionization, the employer
on good employers. should attempt to work with the
union.
Industrial • Labour markets are imperfect and • Regulation is necessary to protect • Collective bargaining and unions are
pluralist characterized by a significant imbal- workers from harsh labour market essential to providing workers with a
ance of power between workers and forces and to ensure a basic and fair “voice” and balancing bargaining
employers. level of working conditions. power in the labour relationship.
• Regulation is especially important • Collective bargaining is an important

for workers who do not have the tool in combatting income inequal-
protection of collective bargaining. ity and promoting democracy in the
workplace and in society more
broadly.
Critical • Labour markets are imperfect and • Strong regulatory protections are • Collective bargaining is a strong
reformist characterized by a significant imbal- the best way to ensure equitable institution for empowering workers
ance of power between workers and employment outcomes in a market but has failed to reach the most
employers, especially with regard to system. vulnerable workers in society.
women, youth, visible minorities, and
new immigrants, who tend to be the
most vulnerable workers.
Radical • Labour markets are constructs • Regulation is a marginally effective • Unions (and collective bargaining)
designed by and for capitalists to tool for addressing the exploitation can be an important and useful
maintain capitalist control and of labour that is an inevitable out- means of raising class consciousness,
privilege. come of capitalist relations. but they will have limited impact
unless their focus is on challenging
the capitalist model.
However, since neoclassical prescriptions for work law flow from the assumption that labour
markets are perfectly competitive, we need to know something about what that means. In a
perfectly competitive market, an equilibrium wage rate exists for any given job, which is the
rate “at which workers are willing to supply exactly the number of hours that employers want to
buy.”12 For example, an equilibrium wage rate for baristas of $10 per hour means that every em-
ployer in the economy that needs a barista can find one at that rate. The demand for baristas
equals the supply of baristas when $10 per hour is offered.
equilibrium wage rate: A theoretical wage rate fixed through market forces in which the supply of labour (the number
of hours workers are prepared to work) equals the demand for labour (the number of hours purchasers of labour wish to buy).

An employer who offers a wage rate lower than $10 per hour will not be able to attract
baristas. No barista would accept a rate lower than the equilibrium rate, since other employers
offer the equilibrium rate or higher. Workers are assumed to be mobile (able to quit a job and
move to a better job whenever they like, or to stop selling their labour altogether) and to pos-
sess full information of all alternative job opportunities. No single barista can bargain a wage
rate higher than the equilibrium rate, since in a perfectly competitive world the employer can
attract all the workers it needs at the equilibrium rate, and all workers are assumed to possess
similar skills.
This description of perfectly competitive labour markets obviously does not describe the real
world. There is no such thing as a perfectly competitive labour market. However, neoclassicists
argue that real-world labour markets “approximate” the theoretical model, so that lessons
learned by studying models of hypothetical, perfectly competitive labour markets should still
guide labour policy.13 Since market forces are assumed to operate competitively and to produce
the most efficient (optimal) outcomes, attempts to interfere in market forces through the intro-
duction of non-market disturbances, such as regulatory standards to protect workers or the
promotion of collective bargaining (and unions), will produce harmful effects, including
unemployment.
The neoclassical perspective rejects all of the regulatory standards legislation we will explore
in Part III. For example, if a government introduced a minimum wage of $12 per hour into a
perfectly competitive labour market for baristas in which the equilibrium wage rate was $10
per hour, employers would respond by hiring fewer baristas, perhaps replacing them with
machines (i.e., substituting capital for labour). Worse still, some employers may simply close
or move outside the reach of the law. In this way, a minimum wage is predicted in the neoclas-
sical perspective to cause higher unemployment.14 This position is reflected in the quotation
from the Fraser Institute, a Canadian think tank that espouses the neoclassical perspective (a
“think tank” is an institution that conducts research and advocates for certain types of policies),
in Box 3.1.
A similar analysis applies to all other wage and non-wage working conditions imposed by
government regulation. Since neoclassicists believe market forces alone produce the optimal
conditions of employment, any legislation that imposes substantive contract terms is wrong-
headed and potentially harmful. If a condition of employment were optimal, then the market
would have produced it as a standard term of employment contracts. Hence, employment stan-
dards legislation requiring notice to terminate an employment contract is unnecessary, according
to neoclassical law and economics scholar Richard Posner (University of Chicago), because if
employees and employers valued them, these clauses “would be negotiated voluntarily.”15 Simi-
larly, occupational health and safety laws impose costs on employers and are unnecessary,
because markets will produce the most efficient level of safety, and employers have “a selfish
interest in providing the optimal … level of worker health and safety.”16
Nor should governments introduce human rights legislation to prohibit discrimination in
employment. Market forces alone will take care of any employer dumb enough to discriminate
on the basis of factors unrelated to productivity. If women or visible minorities will work for less
than men performing similar work, then rational profit-seeking employers will hire only women
and visible minorities, and discriminating employers who pay more for white men will be driven
out of business or forced to change their discriminatory practices.17 Richard Epstein (University
of Chicago), a scholar in the neoclassical perspective, explains this dynamic as follows:
[T]he employer who sacrifices economic welfare for personal prejudice will pay for her preferences
on the bottom line. By forgoing superior labor in order to hire inferior workers, she will sacrifice
resources to indulge consumption choices, and will be at a systematic disadvantage relative to
employers whose economic motivations are more rational.18

Neoclassicists argue that attempts to “fix” discrimination through legislation will impose
unnecessary and inefficient costs on employers and will not help the people the laws are
intended to benefit.
Finally, the neoclassical perspective also opposes laws that support or legitimize unionization
and collective bargaining.19 They see unions as a type of harmful cartel, a combination of
workers organized to control the supply of labour in order to artificially raise wages above the
equilibrium wage rate.20 Collective bargaining often results in unionized workers receiving
higher wages and better benefits than non-union workers. In the neoclassical perspective, this
is a bad thing. Those benefits to unionized workers are said to come at the expense of other
non-union workers, employers, shareholders, and consumers, since employers may pay for the
costs of collective bargaining by raising their product costs.21 Thus, in the neoclassical perspec-
tive, the laws we will consider under Part III and Part IV are met with suspicion or outright
hostility.
The neoclassical perspective prefers the common law regime (Part II). This preference
makes sense because the foundation of that regime is the notion of “freedom of contract”
between individual employee and employer.22 Law plays a role in this perspective, but a limited
one. Judges should enforce the contracts the parties have agreed to, and governments should
enact legislation to protect contracts and property rights to restrict anti-competitive practices
and, possibly, to promote greater information and mobility in labour markets. Beyond that, the
setting of working conditions should be left to contract and market forces. Since the late 1980s,
the neoclassical perspective has been very influential in North America in shaping debates
about labour policies, especially when politically conservative governments are in power.
B. The Managerialist Perspective

The managerialist perspective is closely linked to human resource management (HRM). It
shares with the neoclassical perspective the belief that government intervention in the labour
relationship should be minimal and that, ideally, unions and collective bargaining should not be
present at a workplace. However, managerialists put their faith in enlightened management
practices rather than theoretically perfect competitive markets. They emphasize that employers
and employees share a community of interest: both want the business to be successful. The
managerialist perspective draws inspiration from the pioneering work of sociologist Elton Mayo
(Harvard University, 1880 – 1949) and his Hawthorne experiments from the late 1920s to the
early 1930s.
Mayo and his researchers concluded that socio-psychological feelings that came from being
studied and working as a team caused employees to be more productive.23 This finding was
crucial to the emergence of the “human relations” school (later HRM), which asserts that work-
ers who are treated well on a psychological level will feel more committed to the employer’s
goals, and this commitment will translate into a more productive labour force. The objective of
management should be to foster cooperation and trust with workers. Employers who mistreat
their employees will suffer economically, which could result in the failure of their business.
Conversely, treating workers decently increases productivity and profits. Therefore, businesses
will look out for employees’ concerns because it is in their economic interest to do so. This belief
is a guiding philosophy of the managerialist perspective.
cartel: A combination of individuals or companies that attempt to use collective force or coordination to fix market prices.
managerialist perspective: A view of the law of work guided by the belief that employers have an economic incentive
to treat employees decently and fairly in order to extract commitment and effort. Government legislation of employment should
be kept at a minimum. Unionization is a response to poor management and is disruptive.

FIGURE 3.1 The Managerialist Perspective Demonstrated in a Corporate

“Employee Charter”
Magna is committed to an operating philosophy which is based on fairness

and concern for people. This philosophy is part of Magna’s Fair Enterprise
culture in which employees and management share in the responsibility to
ensure the success of the company. It includes these principles:
Job Security
Being competitive by making a better product for a better price is the best way to enhance job security.
Magna is committed to working together with you to help protect your job security. To assist you, Magna
will provide job counselling, training and employee assistance programs.
A Safe and Healthful Workplace

Magna is committed to providing you with a working environment which is safe and healthful.
Fair Treatment
’
discrimination or favouritism.
Magna will provide you with information which will enable you to compare your total compensation,
companies your division competes with for people. If your total compensation is found not to be
competitive, your total compensation will be adjusted.
Communication and Information

Through regular monthly meetings between management and employees and through publications,
Magna will provide you with information so that you will know what is going on in your company
and within the industry.
The Hotline
Should you have a problem, or feel the above principles are not being met, we encourage you to
contact the Hotline to register your complaints. You do not have to give your name, but if you do, it
The Hotline is committed to investigate and resolve all concerns or complaints and must report the
outcome to Magna’s Global Human Resources Department.
Hotline Number: 1-800-263-1691
ECMEnCA-US201310
Source: Magna Corporation. Reprinted with permission.

Magna’s “Employee’s Charter” in Figure 3.1 is consistent with the managerialist perspective
on how employers should treat workers.24 Magna is a large mostly non-union automobile parts
company with its head office in Aurora, Ontario.
In the managerialist perspective, employment regulation should be kept to a minimum, since
these laws inject rigidity into the work relationship and impose unnecessary costs on employ-
ers.25 If laws are necessary to deal with the worst types of employers (those who do not perceive
the wisdom in treating workers decently), the legal standards should be set at a low level and be
flexible enough to not punish or hamstring “good” employers.26
Unions and collective bargaining are perceived to be an unnecessary impediment to manag-
erial prerogative and flexibility, so governments should not use law to promote either. The
Human Resources Professionals Association captured the managerialist perspective’s view on
collective bargaining when it proclaimed in marketing a union avoidance webinar that “if you
are union-free, you should try to stay that way” and that to achieve this, “management has to
succeed every single day, forever and always.”27 Since it is in the economic interest of manage-
ment to treat workers fairly, workers have no need to look to unions for protection. Managerial-
ists argue that the decision of workers to support unionization reflects a failure of management
to address employee needs through progressive HRM policies.28 This idea is captured in the old
HRM adage, “organizations get the unions they deserve.”29
However, because unionization is perceived to be a rational response by employees to per-
ceived employer mistreatment, the managerialist accepts, more so than the neoclassicist, that
unions have a legitimate role to play in protecting workers from abuse at work. Hence, the
managerialist perspective does not call for the outright legal oppression of unions and collective
bargaining, as do the neoclassicists, although it does advocate for the right of employers to resist
their employees’ attempts to unionize and for a system that permits employees to easily remove
a union.30
C. The Industrial Pluralist Perspective

The industrial pluralist perspective views the work relationship very differently than both the
neoclassical and managerialist perspectives. The guiding insight of the industrial pluralist per-
spective is that an inherent imbalance of power exists between employees and employers that is
problematic for both social and economic reasons. In the unfettered labour market model
favoured by neoclassicists, individual workers lack the ability to safely voice their concerns or
desires for fear of losing their job (they lack “voice”). This lack of voice leaves workers without
the means to participate in decisions that can significantly influence their lives.
Individual workers also lack sufficient bargaining power to negotiate above whatever level
of working conditions the employer is prepared to offer. While this lack of power may benefit
employers and business owners, industrial pluralists argue that it produces vastly unequal so-
cieties in which the wealth created through worker labour tends to gravitate upward to a rela-
tively small proportion of wealthy elite. The resulting income inequality produces an
unsustainable and volatile economy, which plants the seeds for political instability. Thus, for the
industrial pluralist, creating or encouraging countervailing power to that of employers should
be a central public policy objective of laws governing work. The best approach to rectifying this
imbalance is for the law to promote collective bargaining, in which unions or other employee
associations that are independent of the employer negotiate with employers on behalf of
workers.
industrial pluralist perspective: A view of the law of work that emphasizes the inequality of bargaining power between
employers and employees and advocates especially for collective bargaining and unions as a means of empowering workers so
that they can bargain fairer employment outcomes.

This emphasis on inequality of bargaining power in the capitalist employment relationship,

and its perceived harmful effects, is shared with the next two perspectives we will consider (the
critical reformist and radical perspectives). All three dismiss as naive and empirically false the
managerialist’s claim that employers, through progressive HRM policies, will voluntarily strike
an acceptable balance between the competing interests of employees and employers. They also
reject the “free market” prescriptions of neoclassicists, arguing that the models on which they
are based bear no resemblance to the real world, favour the interests of employers and society’s
wealthy and powerful elite, and produce vast economic inequality.31 The differences between
these last three perspectives rest primarily on the focus of their critiques and on the types of
solutions they prescribe to address the problems.
Industrial pluralists argue that the goal of law in relation to work and employment should be
to strike an appropriate balance between the efficiency concerns of employers, on the one hand,
and the equity concerns of workers on the other hand.32 To achieve this goal, the industrial plu-
ralist supports regulatory labour standards that promote a basic floor of adequate working
conditions. However, their main objective is to promote unionization and collective bargaining
(discussed in Part IV). Collective employee representation is considered the most effective way
to ensure worker voice and promote a healthy distribution of wealth throughout the economy.
Collective bargaining, including a legal right to withhold labour (to strike), empowers workers
by putting them on a more equal footing as they bargain for the sale of their labour. It better
ensures that workers can bargain a reasonable share of the economic pie produced by their
labour—a result that benefits the economy (by fuelling consumption) and society (by producing
a decent standard of living).33 Box 3.2 features the benefits of collective bargaining according to
industrial pluralists.

The Benefits of Collective Bargaining
Industrial pluralists argue that collective bargaining is valuable unionized workers have lower turnover rates and that
because it promotes several important outcomes: collective bargaining “shocks” management into imple-
menting more efficient processes.§
• Democracy and voice. It introduces a form of democracy
into the workplace by giving workers the tools and
* For discussion of the “voice” effects of collective bargaining, see Weiler,
power to participate directly in the development and infra note 31; R. Freeman & J. Medoff, What Do Unions Do? (New York:
enforcement of workplace rules and practices.* Basic Books, 1984); G. Davidov, “Collective Bargaining Laws: Scope and
• Distributive fairness. It empowers workers to bargain a Purpose” (2004) 20:1 Intl J Comp Lab L & Ind Rel 81-106 at 86; C. Craver,
larger share of the economic pie than is possible in the “Why Labor Unions Must (and Can) Survive” (1998) 1:1 U Pa J Lab &
Employment L 15-47; K. Klare, “Workplace Democracy and Market
alternative system in which individual employees bar-
Reconstruction” (1988) 38 Cath U L Rev 1. See also Davies, supra note 9 at
gain for the sale of their labour. The result is a stronger 183-85; and D. Doorey, “Graduated Freedom of Association: Worker Voice
middle class and less income inequality, which, accord- Beyond the Wagner Model” (2013) 38:2 Queen’s LJ 515-48 at 516-20.
ing to industrial pluralists, facilitates a healthier † See discussion and sources cited in Lynk, “Labour Law and the New
economy and more stable society.† Inequality,” infra note 34.
• Improved productivity. In a much-cited (and debated) ‡ Freeman & Medoff, supra note *. See also J. Bennett & B. Kaufman, What
1984 book entitled What Do Unions Do?, Harvard Uni- Do Unions Do? A Twenty Year Perspective (New Brunswick, NJ:
versity economists Richard Freeman and James Medoff Transaction, 2004).
concluded that collective bargaining tends, overall, to § M. Gunderson & D. Hyatt, “Union Impact on Compensation, Productivity,
improve productivity slightly, although results vary and Management of the Organization,” in M. Gunderson & D. Taras, eds,
across employers and sectors.‡ The explanations pro- Canadian Labour and Employment Relations, 6th ed (Toronto: Pearson,
2009) 383 at 392-94.
vided for this result included the observation that

Industrial pluralists emphasize the link between collective bargaining and income equality.
For example, the International Labour Organization (ILO), the leading global institution that
promotes collective bargaining around the world, found that income inequality is lower in coun-
tries “in which a greater proportion of workers are affiliated with trade unions.”34 Figure 3.2
depicts the relationship between declining unionization and increasing income inequality
(as measured by the Gini coefficient) in Canada from 1980 to 2010.
Industrial pluralists argue that income inequality is a dangerous social and economic
problem, and that laws promoting decent working conditions and protecting the workers’ right
to collective bargaining must be part of the solution. Industrial pluralism was the dominant
perspective in Canadian politics from the late 1940s until the late 1980s, with all of the major
political parties supporting collective bargaining.35 Unions represented almost 40 percent of
Canadian workers in the mid-1980s, before union density began a decline to its current (2018)
rate of about 28.1 percent overall (and about 16 percent in the private sector).36
FIGURE 3.2 Union Coverage and Income Inequality in Canada
44% 0.44
42% 0.42
Gini Coefficient
Gini Coefficient (range 0-1.00)

40% 0.40
Union Coverage (%)
38% 0.38
36% 0.36
Union Coverage
34% 0.34
32% 0.32
30% 0.30
1980
1982
1984
1986
1988
1990
1992
1994
1996
1996
2000
2002
2004
2006
2008
2010
Source: H. Mackenzie & R. Shillington, “The Union Card: A Ticket Into Middle Class Stability,” (May 2015) at 8, online (pdf): <https://www
.policyalternatives.ca/sites/default/files/uploads/publications/National%20Office/2015/05/Union_Card.pdf>.
Gini coefficient: A statistical measure of economic inequality that measures the extent to which income distribution among
individuals or households within a population deviates from a perfectly equal distribution. The higher the number over 0, the
higher the inequality. In a population with a Gini score of 0.0, everyone earns the same amount. In a population with a score
of 1.0, one person earns all the income.

D. The Critical Reformist Perspective

As noted above, the world view of the critical reformist perspective shares much in common
with the industrial pluralist perspective. However, the critical reformist perspective is more crit-
ical of the outcomes actually produced by collective bargaining in Canada.37 In practice, collec-
tive bargaining has historically benefited certain privileged segments of the working population
and not reached the most vulnerable workers. Professor John Godard (University of Manitoba)
describes this point:
[Critical reformists] tend to be highly supportive of labour unions and collective bargaining, but they
are at the same time often highly critical of the system within which unions currently operate. Their
general argument is that … unions tend to be least effective in the workplaces where workers are
most in need of assistance.38
A particularly rich strand of the critical reformist literature involves feminist critiques of
collective bargaining in Canada. Professor Judy Fudge (McMaster University) captured the
essence of this critique:
Despite the fact that collective bargaining is gender neutral on its face—at best it assumes a sexless
worker, at worst an all male cast. Mostly, it has been done by men for the benefit of men. Its theo-
rists are mostly men, as are its functionaries: arbitrators, board members, union leaders, managers,
and lawyers. One of the presumptions of the postwar social consensus was that the labour force
was unfragmented; that it was composed of full-time male workers in regular and secure employ-
ment. Unions bargained for a family wage for their male members. Until recently, women were
ignored.39
By 2018, more women (32.3 percent) were covered by collective agreements bargained by
unions than men (27.9 percent), primarily because most unionized workers are in the public
sector, where women are highly represented.40 However, critical reformists emphasize that most
vulnerable or precarious jobs (see the discussion in Chapter 4) in Canada are still filled by
women, visible minorities, the disabled, young workers, and new immigrants. These jobs are still
mostly non-union and are characterized by low pay, job insecurity, lack of benefits, and greater
risk of injury.41
Critical reformists are interested in how legal rules and structures have failed to protect Can-
ada’s most vulnerable workers. First, the common law model (Part II) requires workers to “bar-
gain” improvements on their own, but precarious workers lack the bargaining power to do so.
Second, although regulatory standards (Part III) often (although not always) apply to these
workers, in practice, government enforcement is wanting, compliance with the law is low, and
the workers do not have the means and knowledge to enforce the laws on their own.42 Third,
collective bargaining law (Part IV) remains irrelevant to Canada’s most vulnerable workers,
since unions lack the desire or capacity (or both) to effectively represent these workers under
our existing legal models.
Therefore, the focus of this perspective is on critiquing existing legal structures that fail vul-
nerable workers—especially women, visible and religious minorities, new immigrants, and
young workers—and on proposing legal reforms that would do a better job in this regard. Crit-
ical reformists focus on the legal possibilities for more robust and broad-reaching systems of
collective representation and resistance than are offered by existing collective bargaining legal
models as well as more effective regulatory standards legislation.43
critical reformist perspective: A view of the law of work that supports both collective bargaining and regulatory stan-
dards, but emphasizes how both have tended to fail the most vulnerable workers. This perspective focuses on how laws can be
reformed to better protect these workers.

E. The Radical Perspective

The focus of the radical perspective in relation to work law is on the recurrent “regulatory
dilemmas” that by necessity define all capitalist labour markets.44 This perspective builds on the
insights and arguments of Karl Marx. Very briefly, Marx observed that most workers in a capi-
talist society lack the property necessary to create value through their labour power. Therefore,
they must enter a crowded labour market to sell their labour power to those who own property
(employers) to survive, since few have independent means of wealth.
From the employer’s perspective, the worker represents a unit of production (a commodity),
and the objective is to extract maximum labour effort from that unit at minimal cost to produce
profits. However, workers have non-productive needs too; they are humans who seek personal
fulfillment and development both at work and in the non-work sphere. They seek earnings from
selling their labour to aid in fulfillment of those needs. This dynamic is the source of the regula-
tory dilemma that confronts all capitalist economies. Employers and workers have conflicting
interests. Laws that restrict an employer’s ability to extract maximum effort at minimum cost to
protect workers will come at the expense of the employer’s interests in maximizing profits.
Professor Eric Tucker (York University) summarizes the conflict as follows:
[A]t each phase in the circuit of capital, the need of workers for self-development confronts the logic
of capital, which seeks to reduce workers to commodity sellers in competition with each other, to
exercise control over their productive capabilities, to shape their needs and to appropriate for them-
selves the surplus value that is realized in the … process of production.45
The emphasis of the radical perspective is on the various class struggles that arise in a society
as workers seek to overcome the inherently exploitive nature of capitalism. This emphasis leads
to a different perspective on the role of law in labour markets than the other perspectives we
have considered. The emphasis in the radical perspective is on either reforming the capitalist
model or, more likely, supplanting it altogether with a different model in which power is more
equally distributed throughout society. In common with the critical reformist and industrial
pluralist perspectives, the radical perspective is highly critical of both the neoclassical and
managerialist perspectives. Both of those latter perspectives downplay the crucial role that capi-
talist models and institutions play in creating the power imbalance that so often leads to worker
exploitation as employers pursue more profits.
The relationship among the radical, industrial pluralist, and critical reformist perspectives
is more complex. The radical perspective is generally supportive of regulatory standards and
unions and collective bargaining, like the other two perspectives. Regulatory standards can
protect workers from the worst types of employer abuses, and unions can be a means of raising
class consciousness and of extracting greater benefits from employers through collective
action. Therefore, all three perspectives tend to agree on the need for employment regulation
and strong unions. All three also recognize that there will be unavoidable conflict in work
relations.
However, radicals accuse industrial pluralists (and to a lesser degree critical reformists) of
ceding too much to the capitalist model.46 Industrial pluralists tend to accept that, with effective
regulatory standards laws and strong unions, employees’ interests can be effectively addressed
within the capitalist model (albeit occasionally with conflict in the form of strikes or other forms
of employee resistance).47 Radicals argue that, although regulatory standards and laws that pro-
tect and promote collective bargaining can serve a useful role, it is a limited role. Capitalism will
radical perspective: A view of the law of work inspired by Karl Marx’s insights and criticisms of the capitalist system. It
considers regulatory standards regulation and collective bargaining to be helpful but limited in their ability to respond to the
exploitive nature of capitalism. This perspective advocates for a more fundamental transformation of the economic model.

always work to the advantage of capital; the party that owns the means of production, by virtue
of its economic power, will always have greater influence on and access to the political processes
that produce legal rules. Therefore, radicals focus much more on the problems of the capitalist
model and on class-based resistance to it than do industrial pluralists.
The distinction between the radical and critical reformist perspectives is the most blurred.
Both perspectives critique the limited success of unions and collective bargaining in Canada to
fundamentally address many types of worker exploitation and mistreatment, yet both are gener-
ally supportive of collective bargaining as an institution. However, a belief that exploitation of
workers can be fundamentally addressed through the enactment of “better” or different types of
regulatory standards (Part III) than presently exist is a critical reformist argument rather than a
radical argument. The radical perspective demonstrates less confidence than does the critical
reformist perspective in the ability of capitalism to be tamed by protective employment stan-
dards regulation.
The radical perspective played an important role in the development of Canadian work law,
particularly during the formative years of the Canadian collective bargaining regime. Radical-
inspired organizations, such as the Communist Party of Canada, organized unions and led
strikes in the early 20th century that contributed to the climate of industrial worker resistance
that laid the groundwork for labour legislation that survives to this day.48 Growing income
inequality, large-scale global economic downturns and unemployment, and corporate corrup-
tion have spawned renewed interest in the radical perspective and Marx’s work.49
III. Chapter Summary

The purpose of this chapter is to introduce the main schools of thought, or perspectives, that
have tended to guide law of work debates. In practice, the lines between the perspectives are
much more blurred than they appear to be in this chapter; people and organizations can agree
with elements of multiple perspectives at once, or they can shift from one perspective to another
depending on the issues being debated. However, the categories presented here are nevertheless
useful for the journey we have begun.
These perspectives help shape the law of work in a variety of ways. The most obvious is that
they influence key policy debates within the political subsystem that produces the legal regula-
tion of work. Often we see reference to the perspectives explicitly in the political speeches and
propaganda disseminated by politicians and political parties. Academics and think tanks that
research and write about work law often have an allegiance to one or more of these perspectives,
and their views and arguments can influence legal developments. Public opinion on the role and
form of work laws can reflect one or more of these perspectives, and that opinion in turn influ-
ences the beliefs and actions of lawmakers, workers, employers, and associations, as well as
judges and adjudicators who enforce legal rules. An understanding of the dominant perspec-
tives will help readers recognize their influence as we proceed through the text.

1. Briefly explain the key components of the five perspectives in work law identified in this
chapter.
2. Which of the perspectives are supportive of the regulatory standards regime, and which
are not?
3. What are the arguments for and against unions and collective bargaining presented in this
chapter?
4. What distinguishes the industrial pluralist, critical reformist, and radical perspectives?
5. What distinguishes the neoclassical and managerialist perspectives?

EXERCISES
1. Locate a media story that considers a debate about work law reform in Canada. Can you
identify arguments in the story that can be associated with one of the perspectives dis-
cussed in this chapter?
2. The new provincial minister of labour has little background in law or labour relations,
having operated a small non-union business most of her career. However, she is concerned
about a report she read indicating that income inequality in Canada is growing rapidly and
that “real wages” (wage levels relative to rising costs of living) are falling for many workers.
She wants to explore ways to halt these trends. In particular, she is considering two propos-
als: (1) raising the minimum wage, and (2) amending labour laws to encourage more
unionization. You are the deputy minister. The minister has asked you to prepare a short
briefing memo for her that provides background on the various perspectives that tradition-
ally shape debates about workplace law reform.
Prepare a memo for the minister that examines how the perspectives considered in this
chapter would likely perceive the two proposals she is considering. Then explain to the
minister which of these perspectives best describes your own viewpoint and why.

1. “Wal-Mart Stores, Inc.,” online: Fortune 500 <http:// 7. R. Joseph, “Alexandria Ocasio-Cortez Says ‘System That
fortune.com/fortune500/2017/walmart>. Allows Billionaires Is Immoral,’” Global News (22 January
2. “Six C.E.O. Pay Packages That Explain Soaring Executive 2019), online <https://globalnews.ca/news/
Compensation,” New York Times (25 May 2018), online: 4875107/alexandria-ocasio-cortez-system-billionaires
<https://www.nytimes.com/2018/05/25/business/top-ceo -immoral>.
-pay-packages.html>. 8. M. Day, “Bernie Against the Billionaires,” Jacobin Maga-
3. Ibid. See also G. Kessler, “Does the Walton Family Earn zine (2 March 2019), online: <https://www.jacobinmag
More in a Minute than Walmart Workers Do in a Year?” .com/2019/02/bernie-sanders-estate-tax-proposal-2020
Washington Post (19 February 2019), online: <https://www -president>.
.washingtonpost.com/politics/2019/02/19/does-walton 9. This is a common taxonomy found in industrial relations
-family-earn-more-minute-than-walmart-workers-year/ textbooks and scholarship, although terminology can vary.
?noredirect=on&utm_term=.71e7a98 See, e.g., J. Godard, Industrial Relations, the Economy, and
b94a2>. Society, 4th ed (Concord, ON: Captus Press, 2011) at 9-18;
4. See the discussion and sources presented in D. Doorey, and R. Hebdon & T. Brown, Industrial Relations in
“Is It Time to Regulate ‘Maximum’ Pay in Canada?” Canada, 2nd ed (Toronto: Nelson, 2012) at 16-17. See also
online, Law of Work (blog): <http://lawofwork.ca/ A. Davies, Perspectives on Labour Law, 2nd ed (Cam-
?p=4427>. See also D. Gruending, “Canadian CEOs Make bridge: Cambridge University Press, 2009); and J. Budd &
171 Times Average, Let’s Talk Maximum Wage,” Rabble.ca D. Bhave, “The Employment Relationship,” in A. Wilkin-
(2 March 2014), online: <http://rabble.ca/blogs/bloggers/ son, T. Redman, S. Snell & N. Bacon, eds, Sage Handbook
dhg/2014/03/canadian-ceos-make-171-times-average-lets of Human Resource Management (London: Sage, 2010)
-talk-maximum-wage>; and M. Sabnavis, “Bank CEO 51-70.
Compensation: Should There Be a Cap on Pay of Top 10. A. Alchian and W. Allen, University Economics, 3rd ed
Bankers?” Financial Express (7 March 2019), online: (Belmont, CA: Wadsworth, 1972) at 407-8.
<https://www.financialexpress.com/opinion/bank-ceos 11. Extensive literature exists on the application of the neoclas-
-compensation-should-there-be-a-cap-on-pay-of-top sical economics model to labour markets. Most standard
-bankers/1507447>. labour market economics texts explain the model. See, e.g.,
5. Wall Street (Twentieth Century Fox, 1987). Alchian & Allen, supra note 10; and R. Ehrenberg, R.
6. E. Fox, “Wal-Mart’s Low Wages Cost Taxpayers,” CNN Smith & R. Chaykowski, Modern Labour Economics:
Money (5 June 2013), online: <http://money.cnn.com/ Theory and Public Policy (Toronto: Pearson, 2004) at 44-57.
2013/06/04/news/companies/walmart-medicaid>. For a discussion on and critique of the neoclassical

perspective as applied to labour markets, see B. Kaufman, they wish. The law should only interfere where there is evi-
“Economic Analysis of Labor Markets and Labor Law: An dence that a person has not given his or her genuine
Institutional/Industrial Relations Perspective,” in C. consent, for example, in case of duress or undue influence.”
Estlund & M. Wachter, eds, Research Handbook on Eco- 23. E. Mayo, The Social Problems of an Industrialized Civiliza-
nomics of Labor and Employment Law (Northampton, MA: tion (Abingdon, UK: Routledge, 2007).
Edward Elgar, 2012) at 52. See also Davies, supra note 9 at
26-32; B. Kaufman, “The Impossibility of a Perfectly Com- 24. See the Magna “Employee’s Charter” for Canada/USA at
petitive Labour Market” (2007) 31 Cambridge J Econ 775; the company’s website: <https://www.magna.com/
J. Stanford, Economics for Everyone (London: Pluto Press, company/for-employees/our-culture/employees-charter>.
2008) at 99-110; and J. Stiglitz, “Employment, Social Justice 25. Godard, supra note 9 at 15.
and Societal Well-Being” (2002) 141 Intl Lab Rev 9. 26. D. Doorey, “A Model of Responsive Workplace Law”
12. Davies, supra note 9 at 26. Since no individual employer or (2012) 50:1 Osgoode Hall LJ 47 at 67-76; and J. Budd & D.
employee can influence the market-wide equilibrium wage Bhave, “The Employment Relationship,” in A. Wilkinson,
rate for jobs, neoclassical economists say that everyone is a T. Redman, S. Snell & N. Bacon, eds, Sage Handbook of
“price taker” in the labour market. Employers will hire the Human Resource Management (London: Sage, 2010) at 64.
number of employees they require at the equilibrium wage 27. See “Human Resource Professional Association Offers
rate. Credit for Union Avoidance Education,” online, Law of
13. Kaufman, “Economic Analysis,” supra note 11 at 58-61. Work (blog) (2 November 2010): <http://lawofwork.ca/
The assumption that real-world labour markets approxi- ?p=2340>.
mate the perfectly competitive theoretical models is 28. See M. Belcourt, G. Bohlander & S. Snell, Managing
among the mostly hotly contested topics in work law. See Human Resources, 6th ed (Toronto: Nelson Education,
Stiglitz, supra note 11. 2010) at 556.
14. See R. Posner, Economic Analysis of Law, 5th ed (New 29. T. Humber, “Good HR Makes Union Growth Harder,” HR
York: Aspen, 1998) at 361; and Davies, supra note 9 at Reporter (30 May 2017), online: <https://www.hrreporter
139-42. Neoclassicists also argue that the harmful effects of .com/sharedwidgets/systools/_printpost_.aspx?articleid
employment regulation are disproportionately experienced =2276>.
by the least advantaged workers. See the video clip of neo-
30. Doorey, supra note 26.
classicist Milton Friedman on the minimum wage at
<http://lawofwork.ca/?p=6648>. 31. Kaufman, “Economic Analysis,” supra note 11; and P.
15. Posner, supra note 14 at 359; and R. Epstein, “In Defense Weiler, Governing the Workplace: The Future of Labor and
of the Contract at Will” (1984) 51 U Chicago L Rev 947. Employment Law (Cambridge, MA: Harvard University
Press, 1990).
16. Posner, supra note 14 at 363.
32. J. Budd, R. Gomez & N. Meltz, “Why a Balance Is Best:
17. G. Becker, The Economics of Discrimination (Chicago: Uni- The Pluralist Industrial Relations Paradigm of Balancing
versity of Chicago Press, 1957); and R. Epstein, Forbidden Competing Interests,” in B. Kaufman, ed, Theoretical Per-
Grounds: The Case Against Employment Discrimination spectives on Work and the Employment Relationship
Laws (Cambridge: Harvard University Press, 1992). (Champaign, IL: Industrial Relations Research Associa-
18. R. Epstein, Simple Rules for a Complex World (Cambridge: tion, 2004); N. Meltz, “Industrial Relations: Balancing Effi-
Harvard University Press, 1995) at 176. ciency and Equity,” in J. Barbash & K. Barbash, eds,
19. R. Epstein, “A Common Law of Labor Relations: A Cri- Theories and Concepts in Comparative Industrial Relations
tique of the New Deal Labor Legislation” (1983) 92 Yale LJ (Columbia, SC: University of South Carolina Press, 1989);
1357. H. Collins, Employment Law, 2nd ed (Oxford: Oxford Uni-
versity Press, 2010) at 5; and J. Budd, Employment with a
20. Posner, supra note 14 at 350-58.
Human Face: Balancing Efficiency, Equity, and Voice
21. R. Epstein, “The Case Against the Employee Free Choice (Ithaca, NY: ILR Press, 2004). Foundational works in
Act” (working paper, University of Chicago Law and Eco- industrial pluralism include J. Commons, Industrial Good-
nomics Olin Working Paper No. 452, 2009), online: will (New York: McGraw-Hill, 1919); S. Webb & B. Webb,
<https://chicagounbound.uchicago.edu/cgi/viewcontent Industrial Democracy (London: Longmans, Green, 1897);
.cgi?article=1493&context=law_and_economics>. and J. Commons, A History of Labor in the United States
22. Davies, supra note 9 at 28: “[N]eoclassical economists are (New York: Macmillan, 1919). In Canada, a leading voice
strong advocates of the doctrine of freedom of contract. in industrial pluralism was Harry Arthurs. See especially
This means that people should be allowed to enter into H. Arthurs, “Understanding Labour Law: The Debate over
contracts with whomever they choose, on whatever terms ‘Industrial Pluralism’” (1985) 38 Curr Legal Probs 83.

33. See the argument by Professor Robert Reich (University of 41. See the collected works in L. Vosko, ed, Precarious Employ-
California, Berkeley), who was formerly US secretary of ment: Understanding Labour Market Insecurity in Canada
labor, on how unions and collective bargaining promote a (Montreal: McGill-Queen’s University Press, 2006); and
healthy economy in “Why We Need Stronger Unions, and Law Commission of Ontario, Vulnerable Workers and Pre-
How to Get Them,” online, Robert Reich (blog) (27 January carious Work (Toronto: Law Commission of Ontario,
2009): <http://robertreich.org/post/257310148>. 2012), online: <https://www.lco-cdo.org/en/our-current
34. International Labour Organization, World of Work 2008: -projects/vulnerable-workers-and-precarious-work/
Income Inequalities in the Age of Financial Globalization vulnerable-workers-and-precarious-work-final-report
(Geneva: ILO, 2008) at 83; S. Dynarski, “Fresh Proof that -december-2012>; and the discussion on precarious work
Strong Unions Help Reduce Income Inequality,” New York in Chapter 4.
Times (6 July 2018), online: <https://www.nytimes.com 42. M. Thomas, Regulating Flexibility: The Political Economy of
/2018/07/06/business/labor-unions-income-inequality Employment Standards (Montreal: McGill-Queen’s Univer-
.html>; and A. Semuels, “Fewer Unions, Lower Pay for sity Press, 2009).
Everybody,” The Atlantic (30 August 2016), online: <https:// 43. Recent literature from a critical reformist perspective
www.theatlantic.com/business/archive/2016/08/union- includes C. Cranford, T. Das Gupta, D. Ladd & L.
inequality-wages/497954>. See also discussion in the Can- Vosko, “Thinking Through Community Unionism,” in
adian context by M. Lynk, “Labour Law and the New Vosko, supra note 41 at 353; J. Fudge, “After Industrial Cit-
Inequality” (2009) 15 Just Lab 125, online (pdf): <http:// izenship: Market Citizenship or Citizenship at Work?”
www.justlabour.yorku.ca/volume15/pdfs/11_lynk_press (2005) 60 RI 631; K. Rittich, “Feminization and Contin-
.pdf>. gency: Regulating the Stakes of Work for Women,” in J.
35. For a discussion of the rise and fall of industrial pluralism Conaghan, R.M. Fischl & K. Klare, eds, Labour Law in
in Canada, see L. Panitch & D. Schwartz, From Consent to an Era of Globalization: Transformative Practices and Pos-
Coercion: The Assault on Trade Union Freedoms, 3rd ed sibilities (Oxford: Oxford University Press, 2002); K.
(Aurora, ON: Garamond, 2003); and H. Arthurs, “Land- Stone, “Rethinking Labour Law: Employment Protection
scape and Memory: Labour Law, Legal Pluralism, and for Boundaryless Workers,” in G. Davidov & B. Langille,
Globalization,” in T. Wilthagen, ed, Advancing Theory in eds, Boundaries and Frontiers of Labour Law (Oxford:
Labour Law and Industrial Relations in a Global Context Hart, 2006) at 155; and A. Blackett, “Emancipation in the
(Amsterdam: Koninklijke Nederlandse Akademie van Idea of Labour Law,” in G. Davidov & B. Langille, eds, The
Wetenschappen, 1998) at 21. Idea of Labour Law (Oxford: Oxford University Press,
36. Statistics Canada, “Union Status by Geography,” Table 2011).
14-10-0129-01, online: <https://www150.statcan.gc.ca/t1/ 44. See, e.g., E. Tucker, “Reforming Labour Law: Can We
tbl1/en/tv.action?pid=1410012901>; Statistics Canada, Escape Labour Law’s Recurring Regulatory Dilemmas?”
“Union Status by Industry,” Table 14-10-0132-01, online: (2010) 39:2 Indus LJ 99; M. Lebowitz, Beyond Capital, 2nd
<https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid= ed (New York: Palgrave Macmillan, 2003); R. Hyman,
1410013201>. “Pluralism, Procedural Consensus, and Collective Bargain-
37. A. Forrest, “Organizing Eaton’s: Do the Old Laws Still ing” (1978) 16 Brit J Indus Rel 16; and H. Braverman,
Work?” (1988) 8 Windsor YB Access Just 190. Labour and Monopoly Capital: The Degradation of Work in
the Twentieth Century (New York: Monthly Review Press,
38. Godard, supra note 9 at 15. Godard labels this perspective
1974).
“liberal-reformist.”
45. Tucker, supra note 44 at 108.
39. J. Fudge, “Reconceiving Employment Standards Legisla-
tion: Labour Law’s Little Sister and the Feminization of 46. Tucker, supra note 44 at 113-15. See also Godard, supra
Labour” (1991) 7 JL & Soc Pol’y 73 at 77. See also D. note 9 at 16-17; and R. Hyman, Industrial Relations: A
Beatty, “Ideology, Politics, and Unionism,” in K. Swan & K. Marxist Introduction (London: Macmillan, 1975).
Swinton, eds, Studies in Labour Law (Toronto: Butter- 47. Godard, supra note 9. See also Budd, Gomez & Meltz,
worths, 1983) 299; J. Conaghan, “The Invisibility of supra note 32.
Women in Labour Law: Gender Neutrality in Model- 48. On the sporadic role of the Communist Party in Canadian
Building” (1986) 14 Intl J Soc L 377; and J. White, Sisters in labour history, see J. Fudge & E. Tucker, Labour Before the
Solidarity: Women and Unions in Canada (Toronto: Law: The Regulation of Workers’ Collective Action in
Thompson Educational, 1993). Canada, 1900-1948 (Don Mills, ON: Oxford University
40. See Statistics Canada, “Union Status by Industry,” Press, 2001); and D. Morton, Working People, 5th ed
supra note 36; there is a pull down window to search by (Montreal and Kingston: McGill-Queen’s University Press,
gender. 2007).

49. See, e.g., T. Eagleton, Why Marx Was Right (New Haven, World: What Did You Expect from Capitalism?” Foreign
CT: Yale University Press, 2011); S. Jeffries, “Why Affairs (July/August 2018), online: <https://www
Marxism Is on the Rise Again,” Guardian (4 July 2012), .foreignaffairs.com/articles/world/2018-06-14/
online: <http://www.theguardian.com/world/2012/jul/04/ marxist-world>.
the-return-of-marxism>; and R. Varghese, “Marxist

CHAPTER 4
What Is Employment?

II. Legal Tests for Determining Employment Status 54
• Distinguish between an employee, an independent contractor, and a
A. The Common Law Tests for Employment Status 56
dependent contractor.
B. Employment Status in the Regulatory and Collective
• Explain why this distinction is important in the law of work. Bargaining Regimes 59
• Explain how the courts, administrative tribunals, and governments (in III. Is the Distinction Between Employee and Independent
statutes) distinguish between the different groups of workers. Contractor Appropriate? 63
IV. Chapter Summary 64
• Explain how employees are often misclassified as independent
contractors or unpaid interns or trainees with the result that they are Questions and Issues for Discussion 64
excluded from employee protections in the law. Notes and References 66
• Discuss contemporary debates about whether it still makes good policy
sense to rely on the technical legal distinction between “employees” and
“independent contractors.”
I. Introduction
Samir was a taxi driver in Ottawa. He owned his own car and paid the car’s expenses, including the
insurance. He did not own the taxi licence that permitted him to use his car as a taxicab, so he rented
one. Samir decided what hours to work and where in the city to focus his efforts. He could hire
another worker to drive his car when he was not available. He was not paid a wage; his compensa-
tion comprised the amount of fares received from customers remaining after paying his expenses.
One of those expenses was a fee paid to a dispatch company called Blue Line Taxi. That fee
entitled Samir to pick up customers at designated Blue Line taxi stands in Ottawa, and to use a
two-way radio system through which Blue Line assigned customers to taxi drivers. By agreeing
to drive his car under the Blue Line Taxi banner, Samir subjected himself to a set of rules pre-
pared by Blue Line relating to dress code and treatment of customers, among others. If Samir
violated one of these rules, Blue Line could suspend him from access to the dispatch service.
Late one night, on a quiet and dark street, a customer sliced Samir’s throat and ran from the
car. Samir suffered serious injuries, as well as trauma that prevented him from ever driving a
taxicab again. He was unable to do any job for a long while, and he applied for benefits under
workers’ compensation legislation, which creates a government-controlled insurance plan to
compensate employees injured in the course of their employment (see Chapter 24). However, he
was at first denied the benefits because he was found not to be an employee of Blue Line. The
adjudicator ruled that Samir was an independent contractor, in business for himself and therefore
not covered by workers’ compensation legislation, which only insures employees. Samir appealed,
and the workers’ compensation appeals tribunal overturned that decision and ruled that he was
an employee of Blue Line and, therefore, was entitled to workers’ compensation benefits.1
It might seem strange that an issue so important to Samir and his family turns on a narrow,
technical legal distinction between employment and not employment. Yet, as mentioned in
53

Chapter 1, this question of employment status—whether a

worker is characterized as an employee or a “self-employed”
independent contractor—is a central boundary issue in the
law of work.
Common law judges and governments (through legisla-
tion) have developed a complex system of legal rules to regu-
late the employment relationship. Most of the material
considered in this book relates to those rules, which do not
apply to workers who are characterized as independent con-
tractors. Nor do they apply to types of work that are not rec-
ognized as being part of the formal labour market at all, such
as caring for your children or other family members and
other types of unpaid work, such as volunteer work.
This chapter explores how the courts and governments
have drawn boundaries around the employment relationship for the purposes of developing and
assigning special legal rules to that relationship. We need to confront the question of how the
law distinguishes between work performed through the institution of “employment” from work
performed through all other sorts of arrangements at the outset of our journey, because it is a
fundamental question that transcends all three legal regimes: common law, regulatory law, and
collective bargaining law. We will also look at how courts and governments have sometimes
recognized a hybrid category of “dependent contractor,” which lies in between a true employee
and a true independent contractor to extend the reach of employment-related legal rules to eco-
nomically vulnerable contractors. Finally, we will consider the policy question of whether this
distinction between employment and not employment still makes sense as a way of defining who
should be entitled to work-related protections and other social benefits, such as Employment
Insurance.
II. Legal Tests for Determining Employment Status

An employee is a worker who enters into an employment contract with an employer that involves
an exchange of labour for wages (and maybe benefits), and that contract is subject to all of the
laws that govern employment contracts. As we will discuss throughout this text, those laws serve
both to preserve an employer’s authority over its employees and to provide a measure of protec-
tion for employees, who are presumed to be vulnerable. Independent contractors, on the other
hand, are businesspeople who are presumed to be capable of protecting their own interests.2
Therefore, as depicted in Figure 4.1, our laws confer a wide spectrum of protections on “employ-
ees” through both common law and statutory rules and entitlements, whereas independent con-
tractors are largely left to their own devices. Independent contractors enter into commercial
contracts to sell their labour in exchange for revenues and the chance of profit, and the laws that
govern commercial contracts are very different from those that apply to employment contracts.
The distinction between an employee and an independent contractor is also important in
determining liability when workers cause damage to others in the course of their work. Judges
have held employers liable (in tort law) for damages caused by their employees according to a
rule known as vicarious liability, which is considered in Chapter 16. A business would rarely
be held liable “vicariously” for harm caused by an independent contractor.3 Since an employee
is acting on behalf of the employer and under the employer’s control, it is sometimes fair to hold
the employer liable for damage caused by its employees.
independent contractor: A worker who is in business for himself or herself and who, therefore, is not an employee.
employee: A worker who is in a position of subordination to an employer and subject to rules set out in an employment contract.
commercial contract: A contract between two businesses, including a business in the form of an independent contractor.
vicarious liability: A legal rule under which an employer is liable for damage caused to a third party by one or more of its employees.

Chapter 4 What Is Employment? 55
Independent contractors are also treated differently than employees in tax law. The Income
Tax Act treats independent contractors as businesses and permits them to claim expenses to
reduce their total tax bill, whereas employees are not permitted to deduct expenses.4 The ability
to deduct expenses and thereby reduce their tax burden causes some workers to request to be
treated as an independent contractor even though the law might consider them employees.
What distinguishes employees from independent contractors is autonomy and control.
Employees are workers who sell their autonomy over certain key decisions, such as how and
when to work, in exchange for income (wages, benefits) and some measure of job security.
Employees agree to be subordinate to their employer’s control.5 Independent contractors are
running their own business and retain more autonomy and control over how and when they
perform their work. While this may sound straightforward, in practice it is not always easy to
decide whether an employment relationship exists. In many instances, workers exhibit a mix of
autonomy and subordination. Courts, tribunals, and governments have struggled to create legal
tests to help them distinguish employees from independent contractors. Over time, a third
intermediate category known as a dependent contractor also emerged. As a result, today we can
think of the status of workers along a continuum, as depicted in Figure 4.1.
FIGURE 4.1 Categories of Workers in the Law of Work
INDEPENDENT DEPENDENT EMPLOYEES

CONTRACTORS CONTRACTORS Subordinate to and
In business for themselves. Workers who have more economically dependent
autonomy than an “employee,” on their employer.
Relationship is considered a but who remain economically
commercial contract; dependent on one primary ■ Common Law Regime
therefore, the employment customer. o Full law of the employment
laws considered in this text contract considered in Part II
and intended to govern the ■ Common Law Regime of this text applies, including
employment relationship do o Entitled to implied common law implied terms
not apply. “reasonable notice” of such as the entitlement to
termination of contract. “reasonable notice of
Independent contractors may termination” (Chapter 10).
voluntarily opt into some ■ Regulatory Standards
social insurance schemes, Regime ■ Regulatory Standards Regime
such as workers’ o Coverage under some o Full coverage under
compensation and human rights, workers’ employment-related statutes:
Employment Insurance. compensation, and • Employment standards.
health and safety • Human rights.
Unlike employees, legislation. • Workers’ compensation.
independent contractors are • Occupational health and safety.
permitted to deduct business ■ Collective Bargaining • Pay equity/employment equity.
expenses under the Canadian Regime • Employment Insurance.
Income Tax Act. o Full coverage under
collective bargaining ■ Collective Bargaining Regime
legislation. o Full coverage under collective
bargaining legislation.
Employment laws Employment laws Employment laws

do not apply may apply apply
dependent contractor: A worker whose status falls in between that of an employee and an independent contractor. This
worker has more autonomy and independence than a typical employee, yet remains economically dependent on one customer
for income and is subject to considerable control at the hands of that customer.

We will consider first how common law judges distinguish between these categories of work-
ers before turning our attention to the regulatory and collective bargaining regimes.
A. The Common Law Tests for Employment Status

Courts have long struggled with the appropriate legal test to distinguish between an employee,
an independent contractor, and a dependent contractor.
1. Distinguishing Between an Employee and an Independent Contractor

The courts’ approach to assessing whether a worker is an employee or an independent con-
tractor has evolved over time. Initially, courts looked primarily at the degree of control exercised
over the worker (the “control test”). The Supreme Court of Canada described the control test as
follows: “the essential criterion of employer-employee relations is the right to give orders and
instructions to the employee regarding the manner in which to carry out his work.”6 However,
the control test was criticized for being overly simplistic and soon gave way to a more nuanced
“fourfold test,” applied in the 1947 case of Montreal v. Montreal Locomotive Works Ltd., which
considered (1) control, (2) ownership of the tools, (3) chance of profit, and (4) risk of loss.7
In some cases, judges also applied what they called the “organization test,” which asked
whether the work in question is “an integral part of the business” of the purported employer or
only peripheral to that business, and whether the worker had been integrated into the business,
such as through regular scheduling and required adherence to company rules and procedures.8
More recently, in the 2001 case of 671122 Ontario Ltd. v. Sagaz Industries Canada Inc., the Su-
preme Court of Canada encapsulated these various tests into the following new leading state-
ment of the approach judges must take in assessing whether a worker is an employee or an
independent contractor:
The central question is whether the person who has been engaged to perform the services is performing
them as a person in business on his own account. In making this determination, the level of control
the employer has over the worker’s activities will always be a factor. However, other factors to con-
sider include whether the worker provides his or her own equipment, whether the worker hires his
or her own helpers, the degree of financial risk taken by the worker, the degree of responsibility for
investment and management held by the worker, and the worker’s opportunity for profit in the per-
formance of his or her tasks.9 [Emphasis added]
Ultimately, courts look at all of the facts and decide whether the worker looks more like an
employee or more like an entrepreneur who is in business in their own right. We will learn in
Chapter 10 that in the common law regime, employees are entitled to notice of termination to
give them time to prepare for unemployment and look for work. In the three cases considered
below, the workers are claiming that they were “employees” in order to receive damages due to
the alleged employer’s failure to provide them with this contractual entitlement to notice of
termination.
BOX 4.1 » CASE LAW HIGHLIGHT

Employee or Independent Contractor?
Braiden v. La-Z-Boy Canada Limited be signed between that company and La-Z-Boy. Braiden
2008 ONCA 464 worked mostly from a home office, exclusively for La-Z-Boy,
and he paid his own expenses. He was paid solely on the basis
Key Facts: Braiden worked for La-Z-Boy for 22 years as a sales of commissions. La-Z-Boy set sales targets and controlled
representative. In 1996, 15 years into this employment, the which products Braiden could sell and prohibited him from
employer instructed him to sign a contract that stated he was assigning his work for La-Z-Boy to other workers. In 2003,
an “independent sales and marketing consultant” and not an Braiden’s contract was terminated without notice, which
“employee” of La-Z-Boy. In 1997, Braiden was instructed by would be unlawful if he were an employee but not if he were
La-Z-Boy to incorporate a business, and future contracts would an independent contractor. Braiden sued La-Z-Boy for wrong-

ful dismissal, which (as we will learn in Part II) is a lawsuit that sation? In my view, given the findings of the trial
alleges an employment contract was terminated without rea- judge, the answer to that question can only be that
sonable notice having been given. Mr. Braiden was carrying on the business of
La-Z-Boy.
Issue: Was Braiden working pursuant to an “employment”
contract, and, if so, did the employer violate that contract? Braiden was required to work full time and exclusively for
Decision: Yes and yes. The court referred to the Supreme Court La-Z-Boy. The clients were assigned to him by La-Z-Boy. His
of Canada decision in 671122 Ontario Ltd. v. Sagaz Industries territory, which products he sold, the quantity and price, and
Canada Inc. for the applicable legal test and concluded as what sales methods were to be used were determined by La-
follows: Z-Boy. Finally, the sales work he performed was crucial to La-
Z-Boy’s business. Since Braiden was an employee, he was
In many ways, the question … —whose business is working pursuant to an employment contract. Applying the
it?—lies at the heart of the matter. Was the individ- rules of the common law of employment contracts (which we
ual carrying on business for him or herself or was will discuss in Part II), Braiden was entitled to “reasonable
the individual carrying on the business of the organ- notice” from La-Z-Boy of the impending termination of his
ization from which he or she was receiving compen- contract. In this case, that amounted to 12 months’ notice.
In Braiden, the contract clearly stated that the worker was not an employee, and yet the court
ruled that he was. The courts have said that how a contract describes a worker, while relevant,
does not determine the worker’s status. If it did, then an employer could easily avoid all of its
employment law obligations by simply including a term in every employment contract stating
that the worker is an “independent contractor.”

Employee or Independent Contractor?
Fisher v. Hirtz wrongfully terminated without reasonable notice. Hirtz argued
2016 ONSC 4768 that Fisher was an independent contractor.
Issue: Is Fisher an employee of Group Five or an independent

Facts: Hirtz owned a company called Group Five that supplied
contractor?
tradespeople to perform work on home renovations. Fisher
was a painter and was assigned work by Group Five. There was Decision: Fisher is an independent contractor and therefore
no written contract, and Fisher was free to accept or not accept not entitled to reasonable notice of termination. The court
jobs. Fisher submitted invoices for hours worked and was paid discussed the leading cases, including Sagaz Industries and
biweekly based on $35 per hour, with no statutory deductions Braiden v. La-Z-Boy (see above), and ruled that Fisher more
and no benefits from Group Five. Fisher filed her taxes as an closely resembled an independent contractor than an em-
independent contractor, paid for her own insurance, and ob- ployee. She treated herself as an independent contractor in
tained her own workers’ compensation coverage. Fisher owned every way, owned most of the tools, and had freedom whether
most of the tools needed to complete the painting jobs, but to accept jobs offered by Group Five or take other work even
the paint was supplied by Group Five. She was not restricted if she rarely did. She was dependent on Group Five only be-
by Group Five from taking other jobs, although in practice that cause she chose to be, not because the relationship restrained
rarely happened. After about four years, Hirtz and Fisher had her from building a painting business. The court dismissed the
an argument and Fisher was no longer assigned work. Fisher wrongful dismissal lawsuit because Fisher was not an
sued, alleging that she was an employee and she had been employee.
Box 4.3 presents a conceptual tool that helps assess how a court is likely to decide a dispute
over whether a worker is an employee or an independent contractor.

BOX 4.3 » Employee or Independent Contractor? The “Scorecard” Method

Courts and administrative tribunals are often asked to decide factors adjudicators consider. Judges and tribunals do not refer
whether a worker is an “employee” or an “independent con- explicitly to a scorecard like this, but they do weigh the fol-
tractor” because different laws and rules apply to employment lowing factors. No individual factor is determinative of the
contracts than to contracts between two businesses. Although status of the worker. When using this scorecard, consider all
courts apply a variety of legal tests to arrive at a decision on of the facts and ask yourself whether, based on the distribution
the matter, all of these tests attempt to answer one fundamen- of checkmarks in the scorecard, the worker more closely re-
tal question: Does the worker look more like an employee or sembles an independent contractor in business for themselves
like an entrepreneur in business for themselves? or an employee dependent on the company for income. See
One way to assess whether a worker is an employee or an the Exercise at the end of this chapter for scenarios to test this
independent contractor is to use a “scorecard” to track the approach.
FACTORS THAT MAKE THE WORKER LOOK FACTORS THAT MAKE THE WORKER LOOK
MORE LIKE AN EMPLOYEE MORE LIKE AN INDEPENDENT CONTRACTOR
The worker has considerable discretion over when and
The company sets working hours and assigns work.
how to perform work.
The company owns the tools needed to do the job. The worker owns the tools needed to do the job.
The company controls how the work is done and closely The worker receives little direct supervision by the
supervises the work. company.
The customers/clients are the company’s. The worker has a variety of customers/clients.
The worker works exclusively for the company. The worker advertises their services on the open market.
The worker has their own office and pays their own
The work is performed at the company’s premises.
expenses.
The worker has no personal assets invested in the The worker has invested their own money in the busi-
company. ness, so is at risk of loss but could also earn a profit.
The worker must perform assigned tasks themselves. The worker can hire others to perform work.
The worker issues invoices to the company; no employee

Regular employee deductions are made from pay.
deductions are made.
The company sets the price of the goods or services sold The worker has discretion to set the price of goods sold
to customers. or services sold to customers.
The contract defines the worker as an independent
The contract defines the worker as an employee.
contractor.
2. Dependent Contractors in the Common Law Regime

The intermediate category of “dependent contractor” recognizes that a worker might have some
autonomy in the manner in which they perform work, and may have the external appearance of
being an independent contractor, yet still be economically dependent and subordinate. Courts
have ruled that dependent contractors, owing to their subordinate status of economic depen-
dence, should in some respects be treated as if they are employees. Most importantly, a de-
pendent contractor is entitled to “reasonable notice” of termination when their services are
terminated, like an employee.
In assessing whether a worker is a dependent contractor, courts first consider whether the
worker looks more like an employee or a contractor by examining the same factors we just
looked at in Box 4.3. If that analysis leads the court to conclude that the worker more closely
resembles a contractor than an employee, a second step then considers whether the worker is an

independent or a dependent contractor. In considering this latter question, the courts empha-
size the degree to which the worker performed exclusively or almost exclusively for the com-
pany.10 The decision in Box 4.4 demonstrates this approach.

Dependent Contractors in the Common Law
Keenan v. Canac Kitchens Ltd. Keenan argued that he was a dependent contractor, while
2016 ONCA 79 Canac argued he was an independent contractor.
Issue: Was Keenan a dependent or an independent

Key Facts: Keenan was hired as an installer of kitchen cabinets
contractor?
in 1976 and was promoted to foreman in 1983, which required
him to supervise installers at jobs assigned by Canac Kitchens. Decision: Keenan was a dependent contractor. The court of
In 1987, he was informed by Canac that he would henceforth appeal ruled that in assessing whether a worker is a dependent
perform his work as a contractor rather than an employee of contractor, “a finding that the worker was economically de-
Canac. Canac would assign jobs to installers and pay Keenan pendent on the company due to complete exclusivity or a high
a fixed amount per job out of which he would pay the installers level of exclusivity weighs heavily in favour of the conclusion
and manage the project. Keenan was required to obtain insur- that the worker was a dependent contractor.” In assessing
ance in case of damage to the cabinets. He set up a sole pro- whether the relationship was one of exclusive service or near
prietorship called Keenan Cabinetry through which he exclusivity, the judge must consider the entire history of the
provided services to Canac. Payments from Canac did not in- relationship. For almost 30 years, Keenan worked exclusively
clude any deductions. He worked almost exclusively for Canac, for Canac. Only in the final few years did he work for another
but as work from Canac declined beginning in 2007, he started company, and that was only because Canac cut back on jobs.
to do some jobs for another cabinetry company, amounting Viewed in its entirety, this was a relationship of economic
to about 25 percent of his billings compared to about 75 per- dependence and near exclusive service to Canac. Since Keenan
cent from Canac. In 2009, Canac informed Keenan, who was was a dependent contractor, he was entitled to “reasonable
63 years old, that his services were no longer needed. Keenan notice,” which the court assessed at a lengthy period of
sued to recover damages for failure by Canac to provide him 26 months. Therefore, Canac was ordered to pay 26 months’
with “reasonable notice” of termination of the relationship. wages as damages.
B. Employment Status in the Regulatory and Collective Bargaining Regimes

Expert tribunals tasked with interpreting and enforcing employment-related statutes of the sort
we explore in Part III take a similar approach to the courts in deciding whether a worker is an
employee for the purposes of the statute they are interpreting. The issue of employment status
frequently arises because many statutory entitlements in Canada apply only to employees, as
indicated in Figure 4.1. In a typical case, a worker files a complaint under a statute that provides
entitlements to employees, and the employer responds by arguing that the worker is not an em-
ployee and therefore is not covered by the statute. The investigator or tribunal must then decide
if the worker satisfies the definition of “employee” in the statute.
When dealing with statutes, it is important to begin by looking at what the statute says about
the matter. In terms of the distinction between an employee and an independent contractor,
Canadian statutes tend to provide definitions of “employee” that are not particularly helpful. The
Alberta Employment Standards Code definition of “employee” is typical:
“employee” means an individual employed to do work who receives or is entitled to wages and
includes a former employee.11
This definition tells us that an “employee” is a worker who is paid for work they perform, but
it does not explain the difference between an employee and an independent contractor. That

distinction is left mostly to the investigators, tribunals, and courts tasked with enforcing the
legislation. As the case in Box 4.5 demonstrates, those adjudicators approach the question in a
similar manner to the common law courts and apply similar or the same legal tests.

Employee or Independent Contractor for Purposes of Employment Standards Legislation
Director of Labour Standards v. Acanac Inc. referred to the statutory definition of “employee,” which
2013 SKQB 21 stated simply that an employee is “a person of any age who
is in receipt of or entitled to any remuneration for labour or
Key Facts: Acanac provides a technology platform that deliv- services performed for an employer.” An “employer” was
ers voice communication over the Internet. Sabau was retained defined as a person that employs employees and who “either
in September 2009 as a technical assistant at a rate of $10 per has control or direction of [the] employees, or is responsible,
hour, later raised to $12. His job was to answer calls from directly or indirectly … for the payment of wages to … one
Acanac customers and provide them with technical help or more employees.” The court then looked to the common
using Acanac’s platform. Sabau was given basic training, and law tests of employment status, including the Supreme
an Acanac manager could listen in on calls for quality control. Court of Canada decision in Sagaz Industries (referenced
An agreement between the parties identified Sabau as an in- above).
dependent contractor. Sabau logged onto Acanac’s system at The fact that Sabau signed a contract stating he was an
the start of a shift and logged out for breaks and at the end of independent contractor was relevant, but not determinative.
his shift. He also kept track of hours worked on a time sheet. Acanac had control over Sabau in the sense that it coached
In 2010, the relationship ended and Sabau filed a complaint and monitored him and ultimately could terminate the rela-
under the provincial employment standards legislation claim- tionship for poor performance. The clients were Acanac’s, so
ing $6,625 in unpaid wages. Acanac argued that Sabau was an Sabau had little ability to expand his client base or grow his
independent contractor. An employment standards adjudica- income. While Sabau owned the phone and computer needed
tor sided with Acanac, but Sabau applied to the court for to perform the job, the court concluded that “the true tool
judicial review of the decision. here was Acanac’s system. It was Acanac’s system that opened
Issue: Was Sabau an employee for the purposes of the Sas- up Sabau’s opportunity to engage callers.” Considering “the
katchewan Labour Standards Act or an independent totality of the relationship,” the court found that Sabau looked
contractor? more like an employee than an independent contractor.
Acanac was ordered to pay Sabau $6,625 in wages due under
Decision: The court overruled the labour standards adjudi- the Labour Standards Act.
cator and found that Sabau was an employee. The judge
Sometimes governments include definitions that extend coverage under legislation to a wider
segment of workers than might be considered employees if the normal common law tests were
applied. One way to do this is to make the statutes applicable to all contracts and not just
employment contracts. An example can be found in the Ontario Human Rights Code, which
prohibits discrimination in all contracts as well as discrimination in employment.12 This elim-
inates the need for a worker alleging discrimination at work to first prove they meet the legal
test of employee. Similarly, the federal Human Rights Act defines employment broadly as any
“contractual relationship with an individual for the provision of services personally by the indi-
vidual.”13 The Ontario Occupational Health and Safety Act defines an employer as any person
who employs workers, including “contractors and subcontractors” to perform work.14 These
definitions encompass any contract for the performance of work by an individual worker under
employment legislation, regardless of whether the worker would be characterized as an em-
ployee or an independent contractor applying the usual tests.15
Another way to extend the reach of a statute to cover a broader scope of workers than just
employees is to expressly define “employee” to include dependent contractors. For example,

many of Canada’s collective bargaining statutes simply define employee to include dependent
contractors. This expanded definition ensures that collective bargaining rights are available to
workers such as taxi drivers and truck owner-operators who have greater independence than
a typical employee, yet remain vulnerable and dependent on a single business provider such
that they are in a position of subordination similar to an employee.16 An interesting contem-
porary question is whether drivers working under new technology platforms such as Uber
and Lyft will be characterized as employees, dependent contractors, or independent con-
tractors when they apply for coverage under employment-related statutes. This issue is dis-
cussed in Box 4.6.

Are “Gig Workers” Employees?
Are workers engaged in the so-called “gig economy” employ- claim that functionally it is merely a rentier capitalist
ees, dependent contractors, or independent contractors? selling digitialized [sic] dispatch services to drivers.
Many of these workers, such as Uber and Lyft drivers and bike Moreover, it is precisely these kinds of functional
couriers, for example, work with considerable independence controls that make both traditional dispatches and
and own their own “tools” in the form of the cars and bikes Uber vulnerable to being legally classified the em-
they use to perform their work. However, in other respects, ployer of the drivers in its network. Indeed, there is
they resemble employees, or at least dependent contractors. a rash of claims being brought by Uber drivers seek-
For example, by registering and logging onto the Uber app, ing employee status, whether for the purposes of
drivers agree to be bound by rules imposed by Uber in the collective representation or to gain the protection of
same way that taxi drivers have long been bound by rules minimum employment standards, as well as growing
imposed by the dispatch companies that refer customers to legal academic commentary on whether Uber em-
them. Canadian labour boards have ruled in the past that trad- ployees are or should be considered employees.†
itional taxi drivers that rely on a dispatch service are employees
or dependent contractors and therefore protected by Uber drivers in Canada and elsewhere have already begun
employment-related legislation.* Is an Uber driver in a similar to file legal actions asserting they are Uber employees. In 2018,
situation? the English Court of Appeal ruled that Uber drivers are em-
Professor Eric Tucker of York University has discussed the ployees because they are subject to considerable control by
issue of control in the gig economy: Uber once they turn on the Uber app.‡ In 2019, the Ontario
Court of Appeal struck down as illegal a clause in the standard
To achieve its goals of maintaining standards and Uber Eats driver contract requiring that all disputes between
efficiency, Uber exercises considerable control over drivers and Uber be dealt with exclusively through private
its drivers. Although Uber drivers are not required to arbitration held in Amsterdam. That decision cleared the way
book onto the service, once they do, they are gov- for the claim to proceed, which alleges that Uber drivers are
erned by Uber’s rules. For example, when a fare is “employees” and entitled to benefits required under the On-
offered to a driver, the driver has a very limited time tario Employment Standards Act.§
to accept. If the driver does not respond in time, the As we have seen, the issue for courts and tribunals in ad-
fare is offered to another driver. Drivers who decline dressing whether “gig” workers are employees or independent
too many trips may be forcibly logged off the app for contractors is ultimately whether the workers look more like
a period of time. The driver and the vehicle must dependent employees or entrepreneurs in business for them-
meet quality standards set by Uber and are subject selves. The answer is far from obvious when applying the usual
to customer reviews after each trip, with poor re- legal tests. A more fundamental question, considered below,
views potentially resulting in deactivation. These is whether it even makes sense to apply the distinction be-
controls sound remarkably similar to those imposed tween employee and independent contractor to economically
by traditional dispatches, which complicates Uber’s precarious workers, including so-called gig workers, who are
gig economy: An economic arrangement characterized by an exchange of labour for money that is facilitated by an app or
electronic platform that connects customers to workers.

barely earning a living and who are dependent on techno- Online Market Platforms (Ottawa: University of Ottawa Press, 2018) 357
at 379; and M. Cherry, “Beyond Misclassification: The Digital
logical platforms for their income.
Transformation of Work” (2016) 37(3) Comp Lab L & Pol’y J 577.
* Retail, Wholesale and Department Store Union v. Diamond ‡ Uber B.V. v. Aslam, [2018] EWCA Civ 2748; and S. Butler, “Uber Loses
Taxicab Association (Toronto) Limited, 1992 CanLII 6786 (Ont. LRB) Appeal Over Driver Employment Rights,” Guardian (20 December 2018),
(taxi drivers are “dependent contractors” and covered by labour relations online: <https://www.theguardian.com/technology/2018/dec/19/
legislation); J. W. Ferguson Services v. Kolyn, [2005] Ont. LRB Rep. Jan/Feb uber-loses-appeal-over-driver-employment-rights>.
97 (a taxi driver is an “employee” under employment standards
legislation); and Castlegar Taxi (1988) Ltd. v. British Columbia (Director of § Heller v. Uber Technologies Inc., 2019 ONCA 1. See also “Heller v. Uber:
Employment Standards), 1991 CanLII 8187 (BCSC). Some Thoughts from Ontario on Uber’s Arbitration Clause,” online, Law
of Work (blog): <http://lawofwork.ca/?p=9626>. The Supreme Court of
† E. Tucker, “Uber and the Unmaking and Remaking of Taxi Capitalism: Canada heard an appeal from this decision in November 2019, but the
Technology, Law, and Resistance in Historical Perspective” in D. McKee, decision had not been issued at the time of writing.
F. Makela & T. Scassa, eds, Law and the “Sharing Economy”: Regulating
More often, governments narrow the definition of “employee” to exclude from legislative
rules and protections workers who otherwise would be considered employees if the normal
common law tests were applied. As we will learn in Part III of this book, thousands of Canadian
employees are excluded from all or part of employment-related statutes. For various policy
reasons, some of which are far from clear, governments have decided that certain employees
should not be entitled to statutory protections.17 For example, some employment standards
statutes in Canada exclude information technology employees, law articling students, agricul-
tural and construction workers, and workers exercising managerial functions from some or all
of employment standards protections.18
University and college students who are working for companies as part of their educational
program, such as through an academic internship, are also excluded from many statutory pro-
tections.19 In recent years, there has been considerable attention directed at companies that have
mischaracterized employees as unpaid interns or trainees to avoid having to comply with
employment protection statutes. As the case in Box 4.7 demonstrates, a worker who is perform-
ing training for a business outside of a formal educational program is probably an employee
under employment-related statutes even if the employer claims otherwise.

Are Trainees and Interns “Employees” Under Employment Standards Legislation?
Pichette v. Lumac Holdings Ltd. alleging unpaid wages and vacation pay required by the
2011 CanLII 80536 (NBLEB) statute.
Issue: Was Pichette an “employee” for the purposes of the ESA,

Key Facts: A gas station, Lumac, placed an ad for a cashier,
or was she an unpaid trainee?
but by the time Pichette applied the position had been filled.
Pichette told the manager of Lumac (MacKenzie) that she Decision: Pichette was an employee. The tribunal noted that the
would “train for nothing” and work night shifts. MacKenzie statute defined an “employee” as a person “who performs work
agreed to let her train for free, figuring he had nothing for or supplies services to an employer for wages, but does not
to lose, and if Pichette worked out well he would hire her. include an independent contractor.” It does not exclude workers
Pichette worked 27 hours over four days and then asked to who are training, and the ESA prohibits parties from agreeing to
be paid for those hours. Lumac management refused be- contract out of its requirements. Therefore, even if Pichette
cause Pichette had volunteered to work for free. Pichette agreed to work for free, that agreement would amount to an
filed a complaint under the Employment Standards Act (ESA) unlawful contracting out of the ESA. The tribunal concluded:
unpaid intern: A term used to describe a person who performs work for a business or receives training by a business but
who is not paid for that work.

what was said between Pichette and MacKenzie, it

regardless of any arrangements between Lumac is the Act that covers the situation in this case. Pi-
and Pichette, and regardless of whether she said chette is entitled to her pay from day one. She must
that she would work for free or not, the ESA is clear. be paid for the hours that she worked at the min-
It does not allow for unpaid training time. When an imum wage.
employee is given specific duties to do, from that
point on he or she becomes an employee on that Lumac was ordered to pay $266.76 in wages and accrued
date. That is the situation in this case. Regardless of vacation pay.
The practice of using unpaid internships has been defended on the grounds that it enables
young workers to gain much-needed experience and to build career networks that can lead to
good jobs in the future. However, unpaid internships have also been criticized for taking away
paid jobs, for privileging wealthy workers who can afford to work for free, and for perpetuating
the exclusion of young workers from the paid labour market.20
III. Is the Distinction Between Employee and Independent

Contractor Appropriate?
Our discussion so far demonstrates that the distinction between an employee and an in-
dependent contractor is crucial in the law of work, but it is often blurred. There is no test that
clearly distinguishes employees from contractors. In recent years there has been a spike in the
number of employees who are being misclassified as independent contractors. This legal ambi-
guity is problematic because many of Canada’s benefits, protections, and entitlements for work-
ers, both contractual and legislative, are linked to employment.
The significance of the distinction between employees and contractors dates back to the mid-
20th century, when Canadian governments had in mind a particular form of work known as the
standard employment relationship (SER). The SER existed in the post–World War II period
primarily in large industrial workplaces, applied mostly to men,21 and was characterized by
long-term job security, regular full-time hours, and internal job markets in which workers
expected to rise through the ranks of a single employer over their working lives.22 Canadian
labour policy promoted the ideal of the single-income male breadwinner working in an SER,
earning decent pay with benefits, supported by a female spouse performing unpaid domestic
work in the home, perhaps supplemented with “pin money” through occasional part-time work.
Our work laws reflected this ideal and therefore were designed to protect “employees” at work
and also when they lost their jobs through no fault of their own.
However, the ideal of the SER no longer reflects the reality of the labour market for many
Canadians. Whereas in 1960 more than 70 percent of Canadian families had a male parent
working in full-time employment and a female parent at home raising children, by 2014 only 16
percent of families had a stay-at-home mother, and in 69 percent of families both parents
worked.23 Nearly 40 percent of Canadians now work under work arrangements that differ sub-
stantially from the SER, including part-time, seasonal, or temporary jobs as well as “gig” workers
or own account self-employed workers, who might meet the legal definition of an independent
contractor but who are economically precarious and struggle to earn enough to provide for
themselves and their families.24 Often, workers who are legally classified as contractors are more
economically vulnerable than employees who have full-time, good-paying jobs.
standard employment relationship: A model of employment characterized by stable, long-term job security, full-time
hours, decent benefits, and wage rates that rise steadily over time.
own account self-employed workers: Independent contractors who have no employees.

Many of these workers are engaged in precarious work, which may be part time or full time,
but is characterized by few if any employer-provided benefits or a pension plan, low wages, and
less job security and tenure than is anticipated under the SER model.25 The growth in non-
standard work and precarious work over the past few decades has focused attention on the
extent to which our laws have failed to protect some of the most precarious workers.26 When we
view work law and policy through the lens of precarious work, in all its forms, rather than
through the ideal of the SER, this deficiency becomes stark. If a central purpose of work law is
to protect vulnerable workers from the harshness of pure market forces or to inject public policy
concerns into labour markets, for example, then why should it matter whether a worker is for-
mally classified as an employee or a contractor?
Many scholars (and some governments) have proposed that it is time to revisit the law’s reli-
ance on the employee – independent contractor distinction as a gateway to legal rights, entitle-
ments, and responsibilities.27 For example, Professors Fudge, Tucker, and Vosko argue the
following:
A close examination of self-employment in Canada suggests that the time has come to consider dis-
solving the distinction between employees and the self-employed for the purpose of labour protec-
tion and social wage legislation. The majority of the self-employed much more closely resemble
employees than they do entrepreneurs, although for legal purposes many would be classified as in-
dependent contractors and, as such, they would be denied the legal protection available to
employees.28
A better approach, according to Fudge, Tucker, and Vosko, is to presume that any worker who
is “dependent on the sale of their capacity to work” be covered by protective labour legislation,
“unless there are compelling public policy reasons for a narrower definition.”29 A similar
approach, used in some countries, is to expand coverage under protective work-related statutes
and social programs to “workers” rather than “employees,” while making clear that a “worker”
includes an employee but also own account self-employed workers, for example.30 This approach
is roughly equivalent to the approach of some Canadian governments that have extended the
definition of employee to include dependent contractors.
IV. Chapter Summary

This chapter introduced the important distinction between “employees” and “independent con-
tractors” in the law of work. The former are governed by a broad range of legal rules targeting
employment contracts and are eligible for many employment-related legal and social benefits.
The latter are in business for themselves and are treated in the law as businesses. Governments
(through legislation) and the courts (in common law decisions) have sometimes extended the
scope of “employees” to include economically dependent contractors who share more in com-
mon with employees than they do with independent contractors. Governments have also some-
times used a narrow definition of “employees” in statutes to exclude some types of employees
from statutory provisions. Whether it is good public policy to link access to important protec-
tions and social benefits to a technical legal distinction between employee and not-employee is
one of the most important ongoing debates in the law of work.

1. What is the difference between an employee and an independent contractor? Why is this
distinction important in the law?
precarious work: Work that is defined by characteristics such as job insecurity; short job tenure; low pay; few benefits; low
collective bargaining coverage; and sporadic, limited, or unpredictable work hours.

2. Describe the test the Supreme Court of Canada described in Sagaz Industries Canada to
distinguish between an independent contractor and an employee.
3. What is a dependent contractor, and what is the significance of a court finding that a
worker is one?
4. Provide an example of Canadian legislation in which the definition of “employee” was
refined to exclude a worker who would be considered an employee if the usual common
law test for employment status were applied.
5. What is an unpaid intern? What are some reasons for and against making an unpaid intern-
ship unlawful?
6. Explain the difference between the standard employment relationship and precarious
work. Why have some scholars proposed that precarious work is a better concept than
employee versus independent contractor as a means of applying protective work laws?
APPLYING THE LAW

Using the scorecard approach described in Box 4.3, read the employee of the Clinic. Wang was paid an hourly rate while
following three scenarios and indicate whether you think the working at the Clinic. The contract stated that the customers
worker profiled in each would be considered an employee or belonged to the Clinic and not Wang. The Clinic fixed the price
an independent contractor. After doing the exercise, read the of a massage and supplied Wang with all of the necessary
decision to see what the court or expert tribunal actually equipment and supplies to perform the massages. Wang billed
decided. the Clinic every two weeks at the agreed rate for hours worked
at the Clinic, plus an amount for harmonized sales tax. Wang
Scenario One: The Massage Parlour was paid by the Clinic without any deductions, and he claimed
“D” performed massages at Sweet City Massage Parlour. She deductions himself, as a business, when he filed his personal
was one of about 20 massage attendants who performed income taxes.
massages out of Sweet City’s location. Sweet City provided the Was Wang an employee or an independent contractor?
rooms, massage tables, oils and ointments, and linens. D paid Check your answer by reading Wang v. 1139613 Ontario
Sweet City $1 per massage to cover the cost of laundering the Limited (Active Therapy & Sports Clinic), 2013 CanLII 11224 (Ont.
linen. D decided what days she worked at Sweet City, although LRB).
if she did not report for a shift she had agreed to work she
would be fined by Sweet City between $100 and $200. Cus- Scenario Three: The Forklift Sales Representative
tomers at Sweet City could select from among the massage Moseley-Williams worked full time as a salesperson for a forklift
attendants present, but D could refuse any specific customer. supplier called Hansler. He was expected to work only for
No one from Sweet City supervised how D performed her Hansler. He was assigned a jurisdiction in which to sell Hansler
massages. No wage was paid to D. Her income consisted of products and was required to meet certain requirements set
about 50 percent of the fees paid for the massages she gave, down by Hansler while working. However, he performed his
the other 50 percent going to Sweet City. If no customers work mostly on his own within those parameters and was
showed up, she would earn nothing that shift. D could perform often outside of the office meeting and finding new custom-
massages at her home or in other locations if she wished, and ers. He used few tools beyond a car and a phone. Moseley-
she could substitute another person to complete a scheduled Williams owned his own car, but Hansler paid him a monthly
shift at Sweet City. car allowance and also paid for a business cellphone. Moseley-
Was D an employee or an independent contractor? Williams received a commission, the rate of which was set out
Check your answer by reading Abe Vergara o/a Sweet City in a contract between him and Hansler, and he had not in-
v. MNR, 2004 TCC 263. vested his money in Hansler. No statutory deductions were
made from Moseley-Williams’s pay, and his contract described
Scenario Two: The Massage Therapist him as an independent contractor.
Wang performed massages at the facilities of Active Therapy Was Moseley-Williams an employee or an independent
Clinic (Clinic) on a full-time basis. He was the only licensed contractor?
massage therapist. His contract permitted him to perform Check your answer by reading Moseley-Williams v. Hansler
massage services elsewhere, which he did. The contract also Industries Ltd., 2008 CanLII 57457 (Ont. Sup Ct J).
described Wang as an “independent contractor” and not an


1. The story is based on the Decision No. 934/98, 2000 dependent contractor category was Carter v. Bell & Sons
ONWSIAT 3346, aff ’d Blue Line Taxi v. Deek, [2002] OJ (Canada) Ltd., 1936 CanLII 75 (Ont. CA). More recent
No. 2036 (QL) (Sup Ct J). cases include Fisher v. 6007325 Canada Inc., 2017 ONSC
2. G. Davidov, “The Reports of My Death Are Greatly Exag- 5943; Marbry et al. v. Avrecan International Inc., 1999
gerated: Employee as a Viable (Though Overly-Used) Legal BCCA 172; JKC Enterprises Ltd. v. Woolworth Canada Inc.
Concept,” in G. Davidov & B. Langille, eds, Boundaries and (1986), 300 AR 1 (QB); Erb v. Expert Delivery Ltd., 1995
Frontiers of Labour Law (Oxford: Hart, 2006) 133 at CanLII 8874 (NBQB); TCF Ventures v. The Cambie
133-34; and B. Langille, “Labour Law’s Back Pages,” in Malone’s Corporation, 2017 BCCA 129; Glimhagen v. GWR
Davidov & Langille, ibid. at 13. Resources, 2017 BCSC 761; Keenan v. Canac Kitchens Ltd.,
2016 ONCA 79; and Khan v. All-Can Express Ltd., 2014
3. See 671122 Ontario Ltd. v. Sagaz Industries Canada Inc.,
BCSC 1429. For a recent case in which a worker is found
2001 SCC 59; Ivic v. Lakovic, 2017 ONCA 446.
to be an independent contractor, see Thomas v. Vancouver
4. See, e.g., Preddie v. The Queen, 2004 TCC 181. Free Press Publishing Corp., 2019 BCPC 9.
5. B. Langille, “Labour Policy in Canada—New Platform, 17. See discussion in L. Vosko, A. Noack & M. Thomas, How
New Paradigm” (2002) 28 Canadian Public Policy 133 at Far Does the Employment Standards Act, 2000 Extend and
137. What Are the Gaps in Coverage? (Toronto: Ontario Minis-
6. Hôpital Notre-Dame de l’Espérance and Théoret v. Laurent, try of Labour, 2015).
[1978] 1 SCR 605 at 613. 18. See, e.g., ibid.
7. Montreal v. Montreal Locomotive Works Ltd. (1947), 1 DLR 19. Canadian Human Rights Act, RSC 1985, c. H-6, s. 25
161 (PC) at 169.
20. See, e.g., British Columbia Labour Relations Code, RSBC
8. The organization test was first applied in the British Court 1996, c. 244, s. 1(1), and Ontario Labour Relations Act, SO
of Appeal case Stevenson Jordan & Harrison, Ltd. v. Mac- 1995, c. 1, Sched. A, which define “employee” to include
donald, [1952] 1 TLR 101 at 111, Lord Denning. “dependent contractors.” For a discussion of the origins of
9. 671122 Ontario Ltd. v. Sagaz Industries Canada Inc., supra and justification for the “dependent contractor” definition,
note 3, at para 47. see H. Arthurs, “The Dependent Contractor: A Study of
10. See also Belton v. Liberty Insurance Co. of Canada (2004), the Legal Problem of Countervailing Power” (1965) 16:1
72 OR (3d) 81 (CA) (sales representatives are “employees” UTLJ 89; and M. Bendel, “The Dependent Contractor: An
even though their contract described them as independent Unnecessary and Flawed Development in Canadian
contractors); Kordish v. Innotech Multimedia Corp. (1998), Labour Law” (1982), 32 UTLJ 374. See also Quebec’s Act
46 CCEL (2d) 318 (Ont. Ct J (Gen Div)) (a worker can be Respecting Labour Standards, RSQ N-1.1, s. 1, which
an employee even if they created a corporation through defines “employee” as a worker “who is a party to a con-
which work is performed); Doyle v. London Life Insurance tract” to perform work for a person when that person con-
Co., (1985), 23 DLR (4th) 443 (BCCA); and Farmers of trols how the work is to be performed and supplies the
North America Incorporated v. Bushell, 2013 SKCA 108. tools and materials needed to perform the work and the
worker keeps as their pay the amount remaining after
11. Alberta Employment Standards Code, c. E-9, s. 1(1) deduction of expenses.
12. See Ontario Human Rights Code, RSO 1990, c. H.19, s. 3. 21. J. Fudge & L. Vosko, “Gender, Segmentation and the Stan-
Contrast McCormick v. Fasken Martineau DuMoulin, 2014 dard Employment Relationship” (2001) 22 Econ and Indus
SCC 39 (where a law partner was not considered an em- Democracy 271.
ployee, and since the BC Human Rights Code applies to
“employment contracts” and not other contracts, age dis- 22. J. Fudge, “The New Workplace: Surveying the Landscape”
crimination against a partner is not a violation of the (2009) 33 Man LJ 131 at 132; L. Vosko, “Precarious
code). Employment: Towards an Improved Understanding of
Labour Market Insecurity,” in L. Vosko, ed, Precarious
13. Canadian Human Rights Act, RSC 1985, c. H-6, s. 25. Employment: Understanding Labour Market Insecurity in
14. Occupational Health and Safety Act, RSO 1990, c. O.1, s. 1. Canada (Montreal and Kingston: McGill-Queen’s Univer-
15. J. Fudge, E. Tucker & L. Vosko, “Employee or Independent sity Press, 2006) 6; J. Fudge, “The Future of the Standard
Contractor? Charting the Legal Significance of the Dis- Employment Relationship: Labor Law, New Institutional
tinction in Canada” (2003) 10 CLELJ 193 at 211. Economics and Old Power Resource Theory” (2017) 59:3
J Ind Rel 374; and J. Fudge, E. Tucker & L. Vosko, “Chang-
16. See McKee v. Reid’s Heritage Homes Ltd., 2009 ONCA 916
ing Boundaries in Employment: Developing a New Plat-
at para 34. A leading early decision recognizing the
form for Labour Law” (2003) 10 CLELJ 329 at 354.

23. Statistics Canada, “Employment Patterns of Families with 27. See literature at supra note 22. There is a huge literature
Children,” online, <https://www150.statcan.gc.ca/n1/pub/ exploring the challenge posed to employment and labour
75-006-x/2015001/article/14202-eng.htm>. See also B. law by changes to the nature of work and the shift away
Langille, “Take These Chains From My Heart and Set Me from the standard employment model. Some additional ex-
Free: How Labor Law Theory Drives Segmentation of amples include Stone, supra note 24; J. Fudge, E. Tucker &
Workers’ Rights” (2015) 36 Comp Lab L & Pol’y J 257 at L. Vosko, “Employee or Independent Contractor? Charting
259. the Legal Significance of the Distinction in Canada” (2003)
24. Statistics Canada, supra note 23; Vosko, supra note 22; Law 10 CLELJ 193; H. Collins, “Independent Contractors and
Commission of Ontario (LCO), Vulnerable Workers and the Challenge of Vertical Disintegration of Employment
Precarious Work (2013), online: <http:// Protection Laws” (1990) 10 Oxford J Legal Stud 331;
www.lco-cdo.org/en/vulnerable-workers-final-report- S. Deakin, “The Comparative Evolution of the Employment
sectionII>; and K. Stone, From Widgets to Digits: Employ- Relationship,” in G. Davidov & B. Langille, eds, Boundaries
ment Regulation for the Changing Workplace (Cambridge: and Frontiers of Labour Law (Oxford: Oxford University
Cambridge University Press, 2004). Press, 2006) 89; M. Finkin, “The Death and Transfiguration
of Labor Law” (2011-2012) 33 Comp Lab L & Pol’y J 171; J.
25. Statistics Canada, supra note 23. See also Langille, supra
Fudge, “After Industrial Citizenship: Market Citizenship or
note 23.
Citizenship at Work?” (2005) 60 Indus Rel 1; and G.
26. Fudge, “The New Workplace,” supra note 22 at 139. See Davidov, “Who Is a Worker?” (2005), 34 Indus LJ 57.
also L. Vosko, N. Zukewich & C. Copeland, “Precarious
28. Fudge, Tucker & Vosko, supra note 27 at 229.
Jobs: A New Typology of Employment” (October 2003) 4
Perspectives 16, 19; and LCO, supra note 24, s. IV, <http:// 29. Ibid. at 230.
www.lco-cdo.org/en/vulnerable-workers-interim-report 30. See discussion in Davidov, supra note 27 at 57.
-sectionIV>.


Selected Cases: Part I
Cases with boldface page numbers appear as Case Law Highlights.
671122 Ontario Ltd. v. Sagaz Industries Canada Inc., 2001 SCC 59 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56, 57, 66
Abe Vergara o/a Sweet City v. MNR, 2004 TCC 263 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
Belton v. Liberty Insurance Co. of Canada, 2004 CanLII 6668 (Ont. CA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
Braiden v. La-Z-Boy Canada Limited, 2008 ONCA 464 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56, 57
Carter v. Bell & Sons (Canada) Ltd., 1936 CanLII 75 (Ont. CA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
Christie v. The York Corporation, [1940] SCR 139 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Director of Labour Standards v. Acanac Inc., 2013 SKQB 21 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
Doyle v. London Life Insurance Co., 1985 CanLII 301 (BC CA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
Erb v. Expert Delivery Ltd., 1995 CanLII 8874 (NB QB) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
Farmers of North America Incorporated v. Bushell, 2013 SKCA 108 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
Fisher v. Hirtz, 2016 ONSC 4768 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57, 66
Heller v. Uber Technologies Inc., 2019 ONCA 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
Hôpital Notre-Dame de l’Espérance and Théoret v. Laurent, [1978] 1 SCR 605 . . . . . . . . . . . . . . . . . . . . . . . . . 66
JKC Enterprises Ltd. v. Woolworth Canada Inc. (1986), 300 AR 1 (QB) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
Keenan v. Canac Kitchens Ltd., 2016 ONCA 79 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59, 66
Kordish v. Innotech Multimedia Corp. (1998), 46 CCEL (2d) 318 (Ont. Ct J (Gen Div)) . . . . . . . . . . . . . . . . . 66
Machtinger v. HOJ Industries, [1992] 1 SCR 986 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9, 15
Marbry et al. v. Avrecan International Inc., 1999 BCCA 172 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
McKee v. Reid’s Heritage Homes Ltd., 2009 ONCA 916 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
Montreal v. Montreal Locomotive Works Ltd., 1946 CanLII 353 (UK JCPC) . . . . . . . . . . . . . . . . . . . . . . . . 56, 66
Moseley-Williams v. Hansler Industries Ltd., 2008 CanLII 57457 (Ont. Sup Ct J) . . . . . . . . . . . . . . . . . . . . . . . 65
Pichette v. Lumac Holdings Ltd., 2011 CanLII 80536 (NB LEB) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
Seneca College v. Bhadauria, [1981] 2 SCR 181 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Slaight Communications Inc. v. Davidson, [1989] 1 SCR 1038 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Stevenson Jordan & Harrison, Ltd. v. Macdonald, [1952] 1 TLR 101 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
Vriend v. Alberta, [1998] 1 SCR 493 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29, 33
Wang v. 1139613 Ontario Limited (Active Therapy & Sports Clinic), 2013 CanLII 11224 (Ont. LRB) . . . . . . 65
69


Part II
The Common Law Regime
Formation and Requirements of an Employment Contract

CHAPTER 5 A Brief History of the Common Law Model of Employment
CHAPTER 6 The Job Recruitment and Hiring Process
CHAPTER 7 The Requirements to Create and Modify an Employment Contract
The Employment Contract

CHAPTER 8 Expressed Terms of Employment Contracts
CHAPTER 9 Implied and Ancillary Employment Contract Terms
The End of an Employment Contract

CHAPTER 10 Termination by an Employer with “Reasonable Notice”
CHAPTER 11 Termination by “Frustration”
CHAPTER 12 Summary Dismissal: Termination for Cause Without Notice
CHAPTER 13 “You Forced Me to Quit!”: The Special Case of Constructive Dismissal
CHAPTER 14 Damages in Wrongful Dismissal Lawsuits
CHAPTER 15 “I Quit!”: Termination of the Employment Contract by the Employee
Tort Law and Work

CHAPTER 16 Tort Law and the Employment Relationship
Selected Cases: Part II


CHAPTER 5
A Brief History of the Common

Law Model of Employment *

II. Master and Servant Law 73
• Explain the characteristics of master and servant law.
A. English Master and Servant Law 74
• Describe the timeline of the emergence of the common law B. Master and Servant Law in the Canadian Colonies 76
model of employment in England and Canada. III. The Common Law of Employment Contracts in the 19th Century 78
• Explain the similarities and differences between master and A. The Common Law of Employment Contracts in 19th-Century England 78
servant law and the common law of employment contracts. B. The Common Law of Employment Contracts in 19th-Century Canada 80
• Describe the main features of the common law of C. Key Developments in the 20th Century 81
employment contracts in the 19th century. IV. Chapter Summary 81
Questions and Issues for Discussion 82
I. Introduction
As we saw in the overview of the law of work in Chapter 1, the Canadian common law of
employment contracts originates from 19th-century England. Prior to Canada’s Confederation
in 1867, English statutory and common law applied in the new British colonies through a pro-
cess known as reception. As a result of reception, Canadian courts applied English case law to
decide the claims before them. However, much remains to be known about the history of the
common law of employment in Canada, because it has only been viewed as a legal field in
Canada since the 1960s, when common law employment contract claims first became the source
of frequent litigation. This chapter broadly examines the historical evolution of the contract of
employment, starting with its English origins.
II. Master and Servant Law

The English courts first issued common law decisions regarding the employment contract in the
early 19th century, at a time when master and servant law was the primary legal mechanism for
common law: A system of judge-made rules originating in England around the 12th century, and inherited by Canada as a Brit-
ish colony, that uses a precedent-based approach to case law. Earlier decisions dealing with similar facts or legal issues guide later
decisions in an attempt to create legal predictability. However, common law rules can and often do evolve as social values change.
reception: When the British Empire established a colony, it often passed a statute that specified that the law of the colony
was the statutory and common law in force on that date in England.
*This chapter was written by Claire Mummé, Faculty of Law, University of Windsor.
73

74 Part II The Common Law Regime
regulating the terms of employment. Master and servant law was a body of statutory and related
case law first enacted in the 14th century in the wake of the Black Death (the plague pandemic
of 1348 to 1350, in which one-third of England’s population died). This law determined the
rights and obligations of workers and employers based on their social status. Master and servant
law was exported across the British Empire and was applied, in different forms, across the British
North American colonies.1
When the courts first began to issue common law employment contract decisions in the early
19th century, Lord Ellenborough, chief justice of the King’s Bench at the time, suggested that the
common law’s purpose was to regulate the relationships between parties equal in rank and
status. In other words, the common law was to regulate the work of higher status workers. By
contrast, as scholar Daphne Simon argues, the laws of master and servant were “meant to secure
the disciplining and subordination of the wage-earner.”2 But rather than simply apply general
contract principles to the employment contract, in which both parties were viewed as equal in
law, the courts continued to apply existing doctrines and concepts from master and servant law,
such that its central subordinating features were absorbed into the common law framework.3
Therefore, to fully understand the evolution of the common law of employment contracts, a
grasp of master and servant law is required.
A. English Master and Servant Law

As noted above, legislation regulating waged work was first enacted in England in the 14th
century to organize work relations in the aftermath of the Black Death. So as to maintain the
pre-plague social and economic power dynamic between the classes, the English government
(the “Crown”) enacted the Ordinance of Labourers in 1349 and the Statute of Labourers in 1351,
creating a system of compulsory labour that was designed to regulate labour mobility and wage
rates, and which was enforced through penal sanctions.4 In the 16th century, the various
existing statutes were amended and recodified in the Elizabethan Statute of Artificers, during
which time a wage recovery mechanism was created.5
The laws of master and servant were characterized by certain key features that were deployed
in different socio-political contexts and toward different ends at different times, but which
remained more or less in place until the late 19th century.6 The statutes regulated competition
between employers by requiring justices of the peace (JPs) to set wage rates for different profes-
sions, instead of leaving it to the parties. It was illegal for one employer to hire away another’s
worker or to offer higher than legislated wages. Employment contracts were generally presumed
to last for one year (annual hire/general hire contract) unless the parties expressly agreed to
another length of time.7 Workers owed their employers a broad duty of obedience, the violation
of which provided cause for dismissal or even imprisonment, as did a variety of other types of
master and servant law: A body of legislation and related case law that regulated the work of servants, agricultural workers,
and skilled craft workers in England between the 14th and 19th centuries, and which was primarily interpreted and applied by
local justices of the peace and magistrates.
penal sanctions: State punishment imposed through criminal law, usually referring to incarceration.
wage recovery mechanism: A legal provision allowing workers to claim unpaid wages before a justice of the peace or
magistrate.
justice of the peace: In the 19th century, a local nobleman or gentleman appointed to represent the Crown in a particular
locality and empowered by statutes to resolve different types of legal matters; also known as a magistrate.
annual hire/general hire contract: If the parties did not expressly agree on the length of their employment contract, it was
presumed in law to last for one year. The annual hire contract was initially born out of agricultural work. It allowed workers to be
employed between the agricultural seasons, and ensured that workers would not leave their employers right before a harvest.

Chapter 5 A Brief History of the Common Law Model of Employment 75
misbehaviour. Workers could not leave their employment within the contract’s term except with
their employer’s permission and faced fines or jail time for doing so.8 Workers could not, how-
ever, be fired within the contract’s term unless their employer established cause for dismissal
before a JP (or magistrate).9 Workers were regulated by criminal law for contract breaches,
while employers were subject only to civil fines. By the Elizabethan era (1558 – 1603), the statutes
also specified that workers could not leave the parish of their birth without their masters’ per-
mission, unless they secured an annual hire contract in another parish. Workers, therefore,
could not freely move around the country looking for work.10 Some examples of the ways in
which workers’ low legal status affected the laws of master and servant are shown in Box 5.1.

Master and Servant Cases in England
The laws of master and servant that pre-dated the common The Case of James Totterdale
law model of employment treated the worker as subordinate Mr. Totterdale left his home and family in Liverpool in search
to their master, unable to quit during the life of a contract or of work. He was hired by Mr. Perry in Wolverhampton. A short
to disobey orders without sanction. This environment is re- time after starting work, he received a letter from his wife
flected in the following summaries of court decisions and advising him that one of his children was seriously ill and had
rulings by JPs from the early 19th century. only a short time to live, so he should return home immedi-
ately. He did so without stopping to get permission from his
R v. Barton-Upon-Irwell master. He reached Liverpool just in time to see his child die,
[1814] 2 M. & S. 328 and just as another of his children and his wife were stricken
The worker (“servant”) was hired for a period of a year (an an- by the same illness. Mr. Perry had Mr. Totterdale arrested in
nual hire contract). After two months, he was convicted and Liverpool and returned to Wolverhampton. He was taken be-
sentenced to one month’s imprisonment for disobeying the fore the courts under charges of desertion. At the employer’s
master. After nine days, the master requested that he be re- urging, the magistrate ordered that Mr. Totterdale return to his
leased and returned to work. On his return, the servant was job and pay the expenses of his capture and removal, between
again charged with disobedience and insubordination and 3 or 4 pounds.†
was sentenced to one month’s hard labour. He appealed this
Spain v. Arnott
decision, arguing that the first conviction brought the employ-
[1817] 171 ER 638
ment contract to an end. The court disagreed. Lord Ellenbor-
ough CJ decided “[i]t would be clearly against the policy of the The servant worked on a farm. Just as he was about to sit down
law if the servant by his own act of delinquency should have for dinner, his master ordered him to take some horses to a
the power of dissolving the contract. … The imprisonment of nearby town. The servant replied that he would go after he
the servant was so far from being a cessation of the service, had eaten, but the master insisted that he go immediately.
that perhaps his labour might have been required of him by When he refused, he was dismissed. The servant brought a
his master even while he was in prison. … The master indeed claim for wages owing, arguing that he had been dismissed
had an election to avoid the contract, but he made his election without cause within the contract’s annual term. The Statute
to continue the pauper in his service, which it was in his power of Artificers had been interpreted to that point as requiring
to do.” Until this ruling was overturned in 1857, conviction for employers to establish cause in front of a justice of the peace
misbehaviour or desertion did not bring the employment before a servant could be dismissed during the contract’s term.
contract to an end, but rather the worker had to return to work However, Lord Ellenborough cast that step aside and ruled that
after imprisonment and could be recommitted again and masters could dismiss an employee for cause without a JP’s
again until the contract’s term came to an end.* permission and concluded the following:
magistrate: See justice of the peace.

parish: A unit of local government coinciding (in England) with the Church of England’s geographical areas.

If the plaintiff persisted in refusing to obey his thensome and useless servant to the end of the
master’s orders, he is warranted in turning him year. In the present instance it might be very in-
away. He might have obtained relief by applying to convenient for the master to change the hour of
a magistrate [similar to a justice of the peace]; but dinner; the question really comes to this, whether
he was not bound to pursue that course. … There the master or the servant is to have the superior
is no contract between the parties, except that authority.
which the law makes for them, and it may be hard * In Ex Parte William Baker, [1857] 26 Law J Rep MC 193, the Exchequer
upon the servant, but it would be exceedingly in- Court changed course and held that a conviction dissolved the
convenient if the servant were to be permitted to employment contract.
set himself up to control his master in his domestic † From the testimony of George Odger, Secretary of the London Trades,
regulations, such as the time of dinner. After a re- Report from the Select Committee and Royal Commission on Master and
fusal on the part of the servant to perform his work, Servant Law (House of Commons, 1865 – 1875) (Shannon, Ireland: Irish
University Press, 1970) at question 1827.
the master is not bound to keep him on as a bur-
Starting in the mid-19th century,11 as England was in the midst of the massive technological
and socio-economic transformations of the Industrial Revolution, trade union activists mobi-
lized against the penal sanctions of the laws of master and servant. Employers had begun to use
those laws as strikebreaking tools, prosecuting striking workers for misconduct, desertion, or
unpermitted temporary absences. In response, unions argued that the law needed to treat the
parties equally instead of imposing jail time on workers and only fines on employers. They
objected to workers being arrested and hauled before JPs as criminals and argued for treating
work regulation according to a contractual model, which provided at least formal legal equality
between the parties.12 In 1875, the penal provisions of the laws of master and servant were finally
repealed in England. Thereafter, individual statutes were enacted to regulate particular types of
skilled and industrial work, while higher status workers, as well as domestic servants and clerks,
were regulated by an emerging common law of employment contracts.13
B. Master and Servant Law in the Canadian Colonies

As the British Crown began claiming North American lands in what is now known as Canada,
the new colonies received existing English statutory and common law. Each of the Canadian
colonies, therefore, theoretically received the laws of master and servant that were then in force
in England. However, due to different reception dates and different political cultures and eco-
nomic conditions, each colony’s laws of master and servant differed significantly from one an-
other, and sometimes from the laws of England.14 Nova Scotia, for instance, enacted its own
local statute very early, in 1765, which was primarily used by employers to prosecute merchant
seamen in the fisheries industry.15
The Hudson’s Bay Company (HBC), which governed Rupert’s Land (western Canada) under
Royal Charter, provided its workers with a detailed employment contract, the violation of which
gave rise to financial rather than penal sanctions.16 HBC contracts incorporated many of the
requirements of master and servant law. However, they also included other requirements spe-
cific to location and trade; for example, trading post workers were prohibited from having
relationships with members of the Indigenous population or trade on their own account.
In Quebec (then known as Canada East), master and servant law was set and regulated by
municipalities under delegated authority from the Legislative Assembly of Lower Canada after
deadlocked disagreement about whether it constituted private law or criminal law.17
Ontario (Canada West) enacted its own Master and Servant Act in 1847.18 That act was simi-
lar in many respects to the English statutes in force in the mid-19th century: employees who
refused to work, quit within the contract’s term, were disobedient, or injured their employers’

property were subject to fines or up to one month’s imprisonment. As distinct from the English
statutes, however, the Ontario master and servant statute did not regulate apprenticeships;
instead, it broadly applied to servants and labourers rather than to specific occupations.
(See Box 5.2.)
The Ontario act also created a wage recovery mechanism that workers could use to make
claims before JPs for unpaid wages. Paul Craven (York University) reports a steady stream of
cases under the act between 1847 and 1877, the majority of which were wage claims brought by
workers, but by the early 1870s employers were increasingly using the statute as a strikebreaking
tool, deployed against collective action and trade union activity.19 As in England, Canadian
trade unions organized against penal sanctions for breach of the employment contract, and in
1877 the criminal law sanctions for desertion and disobedience were repealed, while malicious
and wilful contract breaches remained a criminal offence.20
In general, the Canadian experience with master and servant law was determined by its
reception date and by the particularities of the local economy and labour market. Regardless of
how much this law was used, the difference in rights and obligations it specified for employers
and workers was symbolic and ideological: master and servant law represented a colonial policy
of protecting class distinctions.21

The Application of Master and Servant Law in Mid-19th Century Canada
Most master and servant cases were not recorded in law books was offered the alternatives of returning to work for
unless they were appealed to the courts. It is, therefore, diffi- three days, forfeiting a week’s wages, paying a $7
cult to research this law. Nonetheless, legal historians have fine, or spending ten days in jail.*
located the records of specific magistrates, JPs, and police
courts, which provide some details. Professor Paul Craven re- * P. Craven, “The Law of Master and Servant in Mid-Nineteenth Century
ports the following cases decided by the Galt Police Court Ontario,” in D.H. Flaherty, ed, Essays in the History of Canadian Law, vol 1
magistracy after the enactment of Ontario’s master and ser- (Toronto: University of Toronto Press, 1981) at 203.
vant statute in 1847, demonstrating the extent
to which the threat of prison and fines was
used to keep workers in line:
A girl who left her service after a dispute

over the peeling of potatoes, in the course
of which her employer, as the latter testi-
fied, “gave her a little push,” was given a
month to pay a $1 fine and $2.35 costs,
with the alternative of two days in jail, and
was told to work out her time or forfeit her
wages. … A boy who was hired to work
on a farm for six months and took his
commitment literally, so that he served
from 22 April to 22 October, and not to
the end of the calendar month, was or-
dered to return to work and make up the
nine days or spend twenty days in jail. A This illustration of a mid-19th-century shoe factory in Nova Scotia shows both the
man who grew impatient with his em- highly labour-intensive nature of work at the time and the appearance of new
ployer’s lethargic search for a replacement industrial technology.

III. The Common Law of Employment Contracts in the 19th Century

Labour lawyers and historians have traditionally believed that the common law of employment
emerged in 19th-century England, just as modern principles of contract law were developing.
As it emerged, the common law is said to have displaced master and servant law, which was then
in the process of becoming obsolete.22 The contractualization of employment was thought to be
part of what historian Henry Sumner Maine called the “movement from Status to Contract.”23
Newer studies, however, demonstrate that master and servant law continued to be actively used
as a disciplinary tool against workers until 1875.24 In Canada, existing research on the history
of the common law of employment prior to the 1960s focuses on Ontario, and for this reason
the next few pages will focus on its trajectory in that province.25 Whether the law’s development
was similar in other Canadian provinces is an open question.
A. The Common Law of Employment Contracts in 19th-Century England

The English common law of employment contracts emerged around the turn of the 19th cen-
tury, as England entered its second Industrial Revolution. In the midst of this transformation,
the courts of England in the early 1800s held that domestic and menial servants, as well as
higher status workers, were excluded from regulation by the laws of master and servant.26 Those
excluded workers now brought their employment-related claims to the common law courts.
The early cases before the common law courts dealt with a wide range of workers, from pro-
fessional employees such as bankers and engineers to lower status workers such as domestic
servants and clerks. In these formative days of the common law model, the courts continued to
apply subordinating concepts and principles from the laws of master and servant. A pure appli-
cation of classical contract law would have required the parties to bargain for an employer’s right
of authority and control, which had been given effect under master and servant law through
workers’ duty of obedience.27 As scholar Alan Fox explained:
[C]ontract as the pure doctrine defined it could not be seen by the property-owning classes as an
adequate foundation for governing the employment relationship. Their needs were met by infusing
the employment contract with the traditional law of master and servant, thereby granting them a
legal basis for the prerogative they demanded. What resulted was a form of contract almost as far
removed from the pure doctrinal form as the status relationship which had preceded it.28
The common law of employment contracts, therefore, was born and has remained a hybrid
body of law, mixing contractual notions of legal equality with principles of status and subordin-
ation, setting it apart from the general law of contract. We will see examples of the distinct status
of employment contract law as we work our way through Part II.
Most significantly, despite theoretical legal equality between contracting parties at common
law, the courts continued to assert that workers had a legal obligation to obey their employers,
and that employers could dismiss workers who did not do so for cause. The courts treated
employers as holding a natural right to control and direct the employment relationship and only
rarely sought to anchor such a right in contract law. The courts also used class to distinguish the
rights and obligations of different kinds of workers. Higher status workers were presumed to
work under annual hire contracts, unless the contract indicated otherwise, and could not be
dismissed within the annual term without cause. In contrast, some lower status workers, such
as domestic servants and clerks, could be terminated without notice or cause where an industry
custom of dismissal by notice existed.29
This class-based distinction was reinforced in the mid-19th century. Under the laws of master
and servant, a worker dismissed without cause during the contract’s term was only entitled to
unpaid wages already accrued. However, in the 1853 case of Emmens v. Elderton, the British

House of Lords held that the employment contract consisted not only of an exchange of wages
for services but also of an ongoing promise to retain an employee in employment for the con-
tract’s duration.30 Dismissal without cause during the contract’s term, therefore, was a breach of
the employer’s promise to retain the worker in employment and entitled the worker to damages
not only for wages already earned but also, potentially, for wages that would have been earned
had the contract run its full term.31 This case was the beginning of the breach of contract action
we today call wrongful dismissal, which is considered in Chapter 14. However, in the formative
years of the employment contract model, the right to recover damages for prospective lost wages
was only available to workers with fixed-term or annual-term employment contracts (typically
higher status workers) and not for employees working under contracts that could be terminated
upon notice.
Employees governed by an annual-term contract could only be terminated for cause. The
courts were asked to consider what constituted cause as the contract model developed. In the
1829 case of Callo v. Brouncker an English court held that disobedience, gross moral miscon-
duct, habitual neglect in business, or conduct calculated to seriously injure the master’s business
constituted cause for dismissal at common law.32 Disobedience was the overarching concept
anchoring the types of cause that permitted dismissal. The notion of disobedience was broad:
workers were required to obey all lawful orders, full stop. The case of Turner v. Mason, described
in Box 5.3, demonstrates the ways in which the duty of obedience created a power differential
between the parties in an employment contract.

The Implied Duty of Obedience
Turner v. Mason I do not think it would be sufficient to justify her in
[1845] 153 ER 411 disobedience to his order; there is not any impera-
tive obligation on a daughter to visit her mother
Key Facts: A domestic servant requested that she be allowed under such circumstances, although it may be un-
to visit her dying mother overnight. Her employer refused, but kind and uncharitable not to permit her.
she went anyhow, staying away until the next day. She was
then fired without the standard industry custom of one The court’s role was not to assess the fairness or kindness
month’s notice. She brought a claim to the courts seeking of the employer’s actions but to enforce the contract as they
damages based on a failure to provide notice. The employer understood it. The court did recognize that exceptional cir-
argued that there was cause for dismissal, which relieved it of cumstances might arise in which an employee would be justi-
the obligation to provide notice. fied in ignoring an employer’s orders:
Issue: Was the employee terminated for cause such that there
There may, undoubtedly, be cases justifying a wilful
was no contractual requirement to provide notice of
disobedience of such an order; as where the servant
termination?
apprehends danger to her life, or violence to her
Decision: Yes. The court ruled that employees are required to person, from the master; or where, from an infec-
obey all lawful orders of the employer. In this case, the order tious disorder raging in the house, she must go out
not to leave the house was lawful, and yet the employee left for the preservation of her life. But the general rule
anyhow. This was a clear breach of the contract by the em- is obedience, and wilful disobedience is a sufficient
ployee, justifying termination without notice. The court was ground of dismissal.
unmoved by the reason the employee left:
wrongful dismissal: A type of lawsuit by an employee against a former employer alleging that the employer terminated their
contract without complying with the implied term in the contract requiring “reasonable notice.”

Toward the end of the 19th century, the duty of obedience was narrowed in scope for higher
status workers, as the courts began to suggest that such workers were only required to obey
orders that related directly to the nature of their job. So, for instance, a lace maker could not be
fired for disobeying an order to do menial work.33 Although the ability to dismiss for cause is
now treated as an implied contract term of the employment contract, as we discuss in Chapter
12, in the 19th century it was rarely described as such. Instead, the duty of obedience and the
employer’s right to dismiss for cause were treated as existing by the natural order of things, as
necessary legal incidents that arose from the nature of the employment relationship. According
to treatise writer Charles Smith, the grounds of cause arose from duties that were “implied by
law from the relationship of master and servant.”34
B. The Common Law of Employment Contracts in 19th-Century Canada

As mentioned, very little research exists about the history of the common law of employment in
provinces other than Ontario prior to the 1960s. The Ontario judiciary applied English prece-
dents to decide the cases before them and very rarely cited cases from the other Canadian col-
onies. Therefore, no national or Canadian colonial body of employment law existed in the 19th
century. And whereas 19th-century England was in the middle of the massive socio-economic
transformation of the Industrial Revolution, Ontario at that time was still primarily a subsis-
tence agricultural economy, with the beginnings of industrial production emerging only at
mid-century. Not surprisingly, therefore, the common law of employment played a small role
during this period in Ontario. Cases that were reported mostly concerned the work of middle-
class and professional workers, almost exclusively male.35
The types of arguments made in early employment contract cases were demonstrative of the
nature of the Ontario labour market at the time. Until the 1840s, Ontario’s economy was over-
whelmingly agricultural. People did not primarily engage in waged labour but instead worked
on their own farms, undertaking short-term waged labour only for the time necessary to ac-
cumulate enough money to purchase land or needed implements. Many tasks were accom-
plished by family members, by the pooling of labour by neighbours, or by payment in kind and
sharecropping rather than through hiring waged labourers.36 Domestic service, for instance, was
primarily undertaken by family members rather than by employees.37 Under English legal pre-
cedent, however, work among family members was presumed not to form an enforceable
employment contract, and so most of these claims were defeated.38
Starting in the late 19th century, workers invoked the common law of employment contracts
more frequently, and it was during the early 20th century that the courts of Ontario began to
give it modern shape. In the late 19th century, Ontario entered into its second Industrial Revolu-
tion, ushering in an era of unprecedented economic growth.39 Between the 1890s and 1930s, the
province saw significant growth in industrial manufacturing, the emergence of new manufac-
turing and transportation technologies, new scientific management theories to systematize
industrial production, incorporation as a growing form of business organization, and a signifi-
cant influx of American direct investment. American direct investment became a major political
and economic force in the province, as branches of American companies opened across south-
ern Ontario. The focus of production shifted from family-based agricultural work to waged
labour in the manufacturing, resource, transportation, and financial sectors. The changing
structures of economic activity, production, and the labour process over the early 20th century
provoked the growth of a waged professional class of white-collar workers in Ontario, and these
implied contract term: A default contract term invented by common law judges and read into an employment contract when
the written terms of the contract (if any) do not address the specific issue addressed by the implied term.

workers brought their employment claims to the common law courts with a new degree of
frequency.
A decisive legal moment took place in 1898, when the Supreme Court of Canada followed
the English and American courts and opted to abandon the legal presumption of annual hire
contracts. In England the presumption was successively weakened after the mid-19th century.
In Ontario it seems to have had almost no practical significance and was infrequently litigated.
Nonetheless in Bain v. Anderson & Co. the Supreme Court of Canada held that when the parties
have not expressly agreed to the length of an employment contract, it would no longer be pre-
sumed to last for a year, but would rather be determined based on the intentions of the parties
and the facts at hand. In England, the courts had reached a similar conclusion in 1891, holding
that there was no presumption of annual employment. Rather, where no express duration was
chosen by the parties, there was a presumption of indefinite duration employment, and such
employees could be fired without cause as long as they were provided reasonable notice of
dismissal.40
The presumption of annual hire had been conceptually significant to the development of the
early common law of employment contracts in a few ways. The length of employment contracts
had served to determine the permissible timing of dismissal and the potential damages for
wrongful dismissal. Once the presumption was abandoned, the courts needed a new way to
determine when employers could dismiss their employees, and thus expanded the concept of
dismissal by industry custom to a broad right to dismissal with reasonable notice, now applic-
able to all employees.
C. Key Developments in the 20th Century

During the early 20th century, the courts expanded the number of implied duties workers owed
to their employers, adding the duties of fidelity, good faith, and confidentiality to the pre-
existing duty of obedience (see Chapter 9). At the same time, they drew on contractual princi-
ples to limit the rights employers could exercise over workers’ time and efforts, looking to
industry custom and the intentions of the parties to allow workers some times of the day outside
of their employers’ control. In Ontario, at least, the courts continued to strictly apply English
precedent and rarely cited cases from the other Canadian provinces.41 The development of the
common law of employment contracts seemed to stall over the mid-20th century, however,
owing to the massive unemployment of the Great Depression followed by the full employment
levels of World War II (discussed in Chapter 4). It would not be until the 1950s and 1960s, as
the standard employment relationship of the Fordist era came to prominence, that the courts
would once again actively develop the common law of employment contracts. They now did so
within a national framework, no longer reliant on English law, with active conversation among
the courts of the Canadian provinces. From the 1960s onward, Canadian courts developed the
common law of the employment contract that will be described in the next dozen chapters.
IV. Chapter Summary

This chapter examined the historical origins of the common law model of employment regula-
tion. As was discussed, from its early years in the 19th century, the common law regulation of
work has stood apart from the general law of contract. It is distinct not only in terms of its con-
standard employment relationship: A model of employment characterized by stable, long-term job security, full-time
hours, decent benefits, and wage rates that rise steadily over time.
Fordism: Refers to the era between the 1920s and 1960s, characterized by industrial mass production by semi-skilled union-
ized male workers with relatively secure jobs within large, vertically integrated companies. The term is derived from American
industrialist and automaker Henry Ford.

tinued conceptual ties to master and servant law but also because it continues to grapple with
the issues posed by the fundamental power asymmetries between employers and employees, as
we shall see in the coming chapters.

1. What aspects of master and servant law justify its classification as a legal regime premised
on the subordination of workers?
2. In what ways does the common law of employment contracts resemble and differ from
master and servant law?
3. Why did the common law of employment contracts first emerge in England when it did?
4. Was the employment relationship heavily regulated in Ontario in the 19th century?
5. When and why did common law employment contract cases arise with regularity in
Ontario?

1. See D. Hay & P. Craven, eds, Masters, Servants and Magis- 6. The early master and servant statutes applied to the waged
trates in Britain and Empire, 1562 – 1955 (Chapel Hill, NC: work of agricultural workers, household servants, and
University of North Carolina Press, 2004) for more details labourers, and to the employment relationships between
on the use of master and servant law across the British apprentices, journeymen, and master craftsmen. Until the
Empire. 1830s, they also imposed requirements for entry into the
2. Lord Ellenborough in R v. Heywood, [1813] 105 ER 233; skilled trades. For a discussion on the changing uses of
and D. Simon, “Master and Servant,” in J. Saville, ed, Dem- the master and servant statutes over time, see R. Steinfeld,
ocracy and the Labour Movement (London: Lawrence and The Invention of Free Labor: The Employment Relation in
Wishart, 1954) at 198. English and American Law and Culture, 1350 – 1870
(Chapel Hill, NC: University of North Carolina Press,
3. Modern contract law, or “free will contract,” was itself in
1991); R. Steinfeld, Coercion, Contract and Free Labor in
the process of development in the early 19th century. See
the Nineteenth Century (New York: Cambridge University
P. Atiyah, The Rise and Fall of Freedom of Contract
Press, 2001); D. Hay, “England, 1562 – 1875: The Law and
(Oxford: Clarendon Press, 1979) at xi (repr. in paperback
Its Uses,” in Hay & Craven, supra note 1; and Deakin &
with corrections, 1985).
Wilkinson, supra note 5.
4. Ordinance of Labourers, 23 Edw. III; and Statute of Labour-
7. An annual hire contract renewed itself automatically
ers, 25 Edw. III, stat. 2. The enormous number of deaths
unless either party provided three months’ notice before
resulting from the Black Death resulted in severe labour
the end of its term, operating similarly to a modern resi-
shortages across the country, allowing workers to force
dential tenancy.
employer competition with regard to wages. L.R. Poos,
“The Social Context of Statute of Labourers Enforcement” 8. Usually one month’s imprisonment, although some of the
(1983) 1:1 LHR 27; and R. Palmer, English Law in the Age newer statutes of the 18th and the 19th centuries increased
of the Black Death, 1348 – 1381: A Transformation of Gov- the length to three months. See Hay, supra note 6 at 106.
ernance and Law (Chapel Hill, NC: University of North 9. In Spain v. Arnott, [1817] 171 ER 638, Lord Ellenborough
Carolina Press, 1993). ruled that employers could now dismiss for cause on their
5. Statute of Artificers, 5 Eliz. c. 4. The requirements of the own authority, rather than have to establish cause before a
Statute of Artificers were thereafter interwoven with the magistrate or JP. See Box 5.1.
laws of settlement and the poor laws in the 17th century. 10. As of 1691, however, servants employed under an annual
Together these statutes created a comprehensive system for hire contract were permitted to stay beyond the year in
regulating the labour market. See, generally, S. Deakin & F. their adopted parish and could not be removed from the
Wilkinson, The Law of the Labour Market (Oxford: Oxford parish even if they became destitute. The question of
University Press, 2005) at chapter 3; and N. Landau, “Who whether a servant was employed under an annual hire con-
Was Subjected to the Laws of Settlement? Procedure tract thus became a central point for litigation between par-
Under the Settlement Laws in 18th Century England” ishes trying to minimize their relief obligations. See Deakin
(1995) 43:2 Agric Hist Rev 139. & Wilkinson, supra note 5; and Landau, supra note 5.

11. Certain key features of the law of master and servant had 1775 – 1799” (1991) J Can Hist A 17. For details on the
been abandoned by the early 19th century, as were the process of reception across the British Empire, see J.E.
requirements of the laws of settlement. The wage-fixing Côté, “The Reception of English Law” (1977) 15 Alta L
provisions and the requirements for apprenticeship and Rev 29.
entry into the skilled trades were repealed in the 1810s. 15. According to Paul Craven, it initially applied to indentured
But even with these changes, prosecutions continued to servants and to servants hired for six months or more and
grow throughout the century, and the penalties under the was then expanded to include servants hired by the
statutes were increasingly punitive. As Hay, supra note 6, month. Similar statutes were then passed in Prince Edward
indicates, prosecution and imprisonment were in fact in Island and New Brunswick. The statutes of the Atlantic
steady ascent right up until the date of the penal sanctions’ colonies did not initially impose jail time for breach of
repeal in 1875. contract; instead, they ordered the parties to perform their
12. In testimony before the House of Commons, W.P. Roberts, contracts (“specific performance”) or pay fines for deser-
“the miner’s lawyer,” was asked if he “would treat labour as tion or disobedience. But magistrates appeared to have
you would treat any other commodity,” “merely as an assumed the power to imprison absconding workers in
article to buy and sell.” He replied “yes.” Testimony of W.P. Nova Scotia (even without explicit statutory authorization)
Roberts, reported in the Royal Commission on Labour and New Brunswick (before its statute was amended to
Report, 1865 – 1875 at questions 2299-30. include this power in 1826). See Craven, supra note 14 at
13. Deakin & Wilkinson, supra note 5. 180-86.
14. Nova Scotia was asserted to be an English colony in 1714, 16. The history of Rupert’s Land and the HBC Charter is a fas-
and it was thereafter subdivided to include the colonies of cinating aspect of Canadian history. In particular, the fact
Prince Edward Island in 1769 and New Brunswick in 1784. that the company operated as a government, a business,
The colony of New France was ceded to the British at the and an employer created a unique employment law
end of the Seven Years War of 1756 – 63. The colony was regime. For a detailed history of employment under the
divided into Upper and Lower Canada in 1791. Ontario, or HBC, see E.I. Burley, Servants of the Honourable Company:
Upper Canada, was “created” as a British colony when it Work, Discipline, and Conflict in the Hudson’s Bay
was separated off from Quebec to accommodate British Company, 1770 – 1879 (Toronto: Oxford University Press,
Loyalists fleeing the United States in the late 18th century. 1997).
Western Canada, then called “Rupert’s Land,” included 17. The Quebec Act of 1774 attempted to resolve the confusion
what is now Alberta, Manitoba, parts of Saskatchewan, the created after the British colonial government introduced
Northwest Territories, Nunavut, and parts of northern English common law principles and procedures into the
Quebec and Ontario. Exclusive control over Rupert’s Land administration of the colony. The act reverted to the use of
was given to the Hudson’s Bay Company (HBC) in 1670 French civil law for resolving private law disputes, while
through a Royal Charter from the English Crown. HBC criminal law would be based on the English common law.
held control over the area until 1869, when the company The difficulty was that, because master and servant law
surrendered its charter. The area was dominated by the fur used criminal penal sanctions to remedy breach of con-
trade and heavily settled by Indigenous and Métis com- tract, it did not fall clearly within either civil or criminal
munities. With its Charter, HBC was given the power to law. Rather than expressly deciding how to classify
enact its own laws and regulations with regard to the com- employment regulation, the Legislative Assembly of Lower
pany’s governance and for the advancement of trade, as Canada delegated employment regulation to the colony’s
long as those laws and regulations were not repugnant to three municipal districts. See Craven, supra note 14 at
the laws of England. HBC, therefore, created its own 186-89; Ian Pilarczyk, “‘Too Well Used by His Master’: Ju-
private system of government. See P. Craven, “Canada dicial Enforcement of Servants’ Rights in Montreal,
1670 – 1935, Symbolic and Instrumental Enforcement in 1830 – 1845” (2001) 46 McGill LJ 491; Ian Pilarczyk, “The
Loyalist North America,” in Hay & Craven, supra note 1. Law of Servants and the Servants of Law: Enforcing
The regulation of paid employment in the fisheries in early Masters’ Rights in Montreal, 1830 – 1845” (2001) 46 McGill
Newfoundland was tied directly to the relationship LJ 779.
between British merchants, resident planters, and servants 18. An Act to Regulate the Duties Between Master and Servant,
through the mechanisms of Palliser’s Act. As Cadigan and for Other Purposes Therein Mentioned, S. Prov. Can.
argues, the act had a significant effect on the shape of 1847, c. 23.
Newfoundland’s settlement and economy. See S. Cadigan,
19. Craven, supra note 14 at 200-1.
“Merchant Capital, the State, and Labour in a British
Colony: Servant-Master Relations and Capital Accumula- 20. Ibid. at 202-3.
tion in Newfoundland’s Northeast-Coast Fishery, 21. Ibid.

22. See Simon, supra note 2, for an example of this argument. 34. C. Smith, A Treatise on the Law of Master and Servant
23. H.S. Maine, Ancient Law (London: John Murray, 1920) at (Philadelphia: T. & J.W. Johnson, 1852) at 68-69.
173. Maine famously argued that modern societies were 35. These cases stand in contrast to English cases during
ones that had moved from a state “in which all the rela- the time, which saw claims from lower status workers
tions of persons are summed up in the relations of Family” and female domestic servants throughout the 19th
toward “a phase of social order in which all these relations century.
arise from the free agreement of individuals.” 36. J. Webber, “Labour and the Law,” in P. Craven, ed, Labour-
24. See, e.g., Deakin & Wilkinson, supra note 5. ing Lives: Work and Workers in 19th Century Ontario
25. See C. Mummé, That Indispensable Figment of the Legal (Toronto: University of Toronto Press/Ontario Historical
Imagination: The Contract of Employment at Common Law Studies Series, 1995) at 118-23.
in Ontario, 1890s – 1979 (PhD thesis, York University, 37. The work of domestic servants was important to the de-
2013). velopment of the common law of employment contracts
26. Lowther v. Earl of Radnor, [1806] 8 East, 113; and Branwell in England. The issue of industry custom of dismissal by
v. Penneck, [1827] 7 B and C 536, 108 Eng. Rep. 823. notice first emerged from their work. But because family
members in Ontario did most 19th-century domestic
27. A. Fox, Beyond Contract: Work, Power and Trust Relations
work, and because the local master and servant statute
(London: Faber and Faber, 1974) at 183; and P. Selznick,
covered domestic servants, they did not figure in the case
Law, Society and Industrial Justice (New York: Russell Sage
law of 19th-century Ontario. This meant, for instance,
Foundation, 1969) at 132.
that the body of law that developed in England around
28. Fox, supra note 27. the industry custom of dismissal by notice for domestic
29. See S. Jacoby, “The Duration of Indefinite Employment servants was not actively applied in Ontario in the 19th
Contracts in the United States and England: An Historical century.
Analysis” (1982) 5 Comp Lab LJ 85 at 95-103; J. Bird, The 38. Other than wrongful dismissal and family work cases,
Laws Respecting Masters and Servants, Articled Clerks, cases also arose concerning the formalities required of mu-
Apprentices, Manufacturers, Labourers and Journeymen, nicipal corporations in contracting with workers as towns
3rd ed (London: W. Clarke, 1899) at 2. Bird explains that and cities grew and municipalities were incorporated.
this practice arose because in large urban areas it was dif- Some cases concerned the proper interpretation of written
ficult to “learn the character of a servant.” Where no judi- terms of an employment contract. Such claims were almost
cial notice of custom existed, the parties could introduce invariably brought by workers, and, as Craven, supra note
evidence to establish it. In such cases the courts examined 14, indicates, they were relatively strictly interpreted to
evidence of usual practice in the industry, but also used defeat workers’ interests. As noted, there were also a
the one month’s notice for domestic servants as a yard- handful of claims for wrongful dismissal and claims for
stick, comparing the relative social status of the industry to wages. Although such claims were few, when they arose
domestic service to determine the likelihood of the sug- the courts faithfully applied English precedent to decide
gested custom. In Beeston v. Collyer, [1827] 172 ER 276, them. Finally, in addition to claims among family
the court rejected the argument of an industry custom of members for wages, there were seduction cases, in which
one month’s notice for dismissal for a clerk to an army employers or parents sued men who had impregnated
agent: “A man in this class is not likely to be able to get a their daughters/servants out of wedlock for lost wages. See,
situation so soon as a butler or a footman can,” said Best e.g., Cromie v. Skene, [1869] 19 UCCP 328.
CJ. He added, on appeal, that “it would be, indeed, extra-
39. For general statistics and analysis of the transformation
ordinary, if a party, in his station of life, could be turned
and rapid growth of the Canadian economy over the early
off at a month’s notice, like a cook or scullion.” By the mid-
20th century, see O.J. Firestone, Canada’s Economic De-
19th century, the English courts held that there was an
velopment, 1867 – 1953 (London: Bowes and Bowes, 1958);
industry custom for clerks to be dismissed with three
R.C. Brown & R. Cook, Canada 1896 – 1921: A Nation
months’ notice. See also Metzner v. Bolton, [1854] 156 ER
Transformed (Toronto: McClelland & Stewart, 1991) at
221; and Fairman v. Oakford, [1860] 157 ER 1334.
chapter 5; C. Heron, “The Second Industrial Revolution in
30. Emmens v. Elderton, [1853] 13 CB 495 (HL). Canada, 1890 – 1930,” in D.R. Hopkin & G.S. Kealey, eds,
31. Ibid. at 506. Class, Community and the Labour Movement (Wales:
32. Callo v. Brouncker, [1829] 2 Man. and Ry. 502, (1831), Llafur/CCLH, 1989) at 50-53; G. Stapells, “The Recent
4 C. and P. 518. Consolidation Movement in Canadian Industry” (master’s
thesis, University of Toronto, 1922); C. Heron & B.D.
33. Price v. Mouat, [1861] 11 CB (NS) 508. See also Deakin & Palmer, “Through the Prism of the Strike: Industrial Con-
Wilkinson, supra note 5 at 14-15, 80. flict in Southern Ontario, 1901 – 1914” (1977) 8:4 Can Hist

Rev 423; P. Craven, An Impartial Umpire: Industrial Rela- 40. See Lowe v. Walter, [1892] 8 TLR 358; and Bain v.
tions and the Canadian State (Toronto: University of Anderson & Co. (1898), 28 SCR 481.
Toronto Press, 1980) at 90-110; G. Lowe, “The Administra- 41. For greater detail on the changing content of the common
tive Revolution: The Growth of Clerical Occupations” (dis- law of employment contracts in the early 20th century, see
sertation, University of Toronto, 1979); and G. Bertram, C. Mummé, “From Control Through Command to the
“Economic Growth in Canadian Industry, 1870 – 1915: The Control of Discretion: Labour Time, Labour Property and
Staple Model and the Take-Off Hypothesis” (1963) 29:2 the Tools of Managerial Control in Early 20th-Century
Can J Econ & Pol Sci 159 at 176-77, 182. Ontario” (2016) 45:1 Indus LJ.


CHAPTER 6
The Job Recruitment and

Hiring Process
II. The Common Law and Discrimination in Job Recruitment and Hiring 88
• Explain the ways in which common law courts regulate the
III. Common Law Torts That Apply to Job Recruitment and Hiring 88
job recruitment process and hiring decision.
A. Tort of Deceit or Fraudulent Misrepresentation by a Prospective
• Understand why complaints alleging discrimination Employer 89
in hiring decisions are dealt with under the B. Tort of Negligent Misrepresentation by a Prospective Employer 90
regulatory standards regime and not the common law C. Fraudulent or Negligent Misrepresentation by a Job Applicant 91
regime. IV. Chapter Summary 93
• Define the torts of deceit and negligent misrepresentation. Questions and Issues for Discussion 93
• Define the contract law concept of fraudulent Exercise 94
misrepresentation. Notes and References 94
I. Introduction
The employment relationship, like a marriage, begins with a courting process. Employers
search for workers by using word of mouth or by placing “want ads” in media where job seekers
look for work. Prospective employees view and respond to these ads, or make cold calls, dis-
tributing their résumés as widely as possible. When the two sides meet, they discuss what the
position entails and whether the job seeker is a suitable candidate. If the two sides like each
other, an offer of employment might be made. This is known as the job recruitment and hiring
process.
Most of the law that affects this process is found in the regulatory regime (Part III), and not
the common law regime. It is easy to see why: the job recruitment process occurs before the cre-
ation of an employment contract, and most of the common law regime deals with the rules of
contracts. The common law regime is guided by the beacon of freedom of contract: employers
and employees will enter into a contractual relationship only when both sides believe that doing
so will make them better off. The role of judges in the recruitment process has primarily been
focused on policing dishonesty and misrepresentations made during the courting process, to
encourage a process in which the parties make informed and rational decisions about whether
to enter into employment contracts.
The virtual absence of common law rules governing the job recruitment and hiring process
eventually worried Canadian governments. In a system driven by the concept of freedom of
contract, employers would be free to hire (or to not hire) anyone they liked. Therefore, an early
output of the common law regime was blatantly discriminatory hiring decisions. Job ads
would openly announce “Men Only” or “Whites Only.” All of this was (and still is) perfectly
lawful within the common law regime. As we noted in Chapter 2, as social values evolve, so
too does the law of work. By the 1950s, governments had begun to enact various statutes that
87

regulated and prohibited some forms of discrimination in hiring. These laws restricted
employers’ freedom of contract. For example, employers could no longer refuse to hire an em-
ployee because of their skin colour or gender. More recently, governments in many countries
have debated whether to restrict employers from searching job applicant’s social media
accounts and relying on information found there in their decision making. These statutory
rules regulating the job recruitment and hiring process will be explored in greater detail in
Part III. In this chapter, we consider the more limited role of common law courts in policing
this process.
II. The Common Law and Discrimination in Job Recruitment

and Hiring
Let’s begin by reviewing the origins of the common law’s silence on discrimination in the job
recruitment and hiring process. We need to travel back to a hot summer evening in Montreal,
1936, before there were anti-discrimination statutes. Fred Christie went to a bar at the old Mont-
real Forum arena. He ordered a beer but was refused because the bar had a rule against serving
“negroes.” Christie sued the bar, claiming $200 for the humiliation he suffered. His case made it
to the Supreme Court of Canada, where he lost. The Supreme Court ruled that the general prin-
ciple of the law is “complete freedom of commerce,” the only restrictions being the existence of
a statute restricting this freedom or “the adoption of a rule contrary to good morals or public
order.”1 In 1940, the Supreme Court did not believe a rule prohibiting “negroes” from buying a
beer fell into either of those two restrictions. In fact, the court chastised Christie for making a
scene and calling the police, “which was entirely unwarranted by the circumstances,” since the
refusal had been done “politely.”2
This case is called Christie v. The York Corporation, and it is an important part of Canadian
legal history.3 It stands for the proposition that, in the common law regime, freedom of contract
reigns supreme. Judges did not want to get involved in telling people (and businesses) who they
can and cannot contract with, even if that meant turning a blind eye to blatant racism and dis-
crimination. Christie was not an employment case, but it had important implications for the law
of work, since it applied to all of contract law. It indicated that under the common law, employers
have no restrictions in terms of who they hire. Years later, this legal principle was tested again
in Seneca College v. Bhadauria (see Box 6.1).
The court found that Bhadauria could file a Human Rights Code complaint, but that she could
not sue Seneca College in a common law action for discrimination. No such common law action
exists. Therefore, the result of the rulings in Christie v. The York Corporation and Seneca College
v. Bhadauria is that discrimination issues in hiring decisions must be dealt with under the sec-
ond regime of work law: regulatory standards.4 We will explore how human rights statutes regu-
late recruitment and hiring in Chapters 21 – 23.
III. Common Law Torts That Apply to Job Recruitment and Hiring
As mentioned earlier, judges play a limited role in policing the job recruitment process. This role
is mostly concerned with regulating the control and truthfulness of information passing
between prospective employers and employees. The theory is that freedom of contract depends
on the parties having sufficient truthful information to assess whether a proposed deal is
rational. If one party misleads the other about key issues relating to the proposed contractual
relationship, then we could no longer assume that the contract is rational and the result of a fair
meeting of the minds. In the pursuit of informed contracting parties, common law judges have
deployed both tort and contract law to promote a truthful flow of information during the job
recruitment and hiring processes.

Chapter 6 The Job Recruitment and Hiring Process 89

The Common Law and Discrimination in Hiring
Seneca College v. Bhadauria prospect of such relations has not been recognized
[1981] 2 SCR 181 at common law as giving rise to any liability in tort.
Key Facts: Bhadauria, a woman of East Indian origin, applied The court then considered whether to uphold the court of
ten times for a job as an instructor at Seneca College. Although appeal’s decision to invent a new common law legal action
well qualified for the position, she was never once invited to based on discriminatory hiring:
an interview. She filed a lawsuit in the common law courts,
alleging that she had been discriminated against on the basis The view taken by the Ontario Court of Appeal is a
of her race. She argued that the court should recognize a new bold one and may be commended as an attempt to
tort prohibiting discrimination in hiring decisions, or a right to advance the common law. In my opinion, however,
bring a lawsuit in court to enforce the Human Rights Code, this is foreclosed by the legislative initiative which
which by this time prohibited discrimination in hiring based overtook the existing common law in Ontario and
on race. The Ontario Court of Appeal agreed with Bhadauria established a different regime which does not ex-
and recognized a new tort, but Seneca College appealed to clude the courts but rather makes them part of the
the Supreme Court of Canada. enforcement machinery under the [Human Rights
Code]. …
Issue: Does Canadian common law recognize a tort of dis-
[N]ot only does the Code foreclose any civil ac-
crimination that prohibits an employer from discriminating
tion based directly upon a breach thereof but it also
against job applicants based on race?
excludes any common law action based on an invo-
Decision: No. The Supreme Court of Canada noted that the cation of the public policy expressed in the Code.
courts had not previously recognized a tort of discrimination: The Code itself has laid out the procedures for vin-
dication of that public policy, procedures which the
[A] refusal to enter into contract relations or per- plaintiff respondent did not see fit to use.
haps, more accurately, a refusal even to consider the
A. Tort of Deceit or Fraudulent Misrepresentation by a Prospective Employer

Employers cannot deliberately mislead or lie to a prospective employee to induce that person to
accept an employment offer. This behaviour is caught by the tort of deceit, as well as a contract
law action called fraudulent misrepresentation.5 Both legal actions can arise when an employ-
er’s representative tells a job applicant something that they know is untrue, and the job applicant,
relying on that statement, ends up suffering a loss.6 If the fraudulent statement induces the
person to enter into an employment contract, that person has the option to rescind the contract
(treat the contract as void) and to recover damages suffered that can be attributed to the mis-
representation. There are few decisions in which Canadian employers have been found to have
committed a tort of deceit or fraudulent misrepresentation during the job recruitment process.
The low number of decisions might indicate that employers rarely lie to applicants or, perhaps,
that it is difficult for a prospective employee to prove deceit and fraud.
deceit: A tort in which party A makes a false statement with the intention of misleading party B; party B relies on the false
statement and, as a result, party B suffers a loss. Damages can be recovered for that loss.
fraudulent misrepresentation: A common law action based in contract law in which party A knowingly makes a false
statement with the intention to mislead party B, and that statement induces party B to enter into a contract. In that case, party
B may be able to rescind the contract and seek damages for any loss suffered.
rescind: To set aside a contract and put the party back into their pre-contract position.

B. Tort of Negligent Misrepresentation by a Prospective Employer

The tort of negligent misrepresentation is also concerned with employers who mislead pro-
spective job applicants, but it does not require a deliberate intention to misinform. As a result,
it is more common than deceit and fraud.7 Like most torts applied in Canada, negligent mis-
representation has its roots in the British common law. The origin of this tort is the 1963 case
Hedley Byrne & Co. v. Heller & Partners.8 Although it is not an employment case, the tort rec-
ognized in it has since been applied to cases where employers have made promises to pro-
spective employees.9
In Hedley Byrne, a bank (Heller & Partners) informed a business (Hedley Byrne) that com-
pany X was a good credit risk, when in fact company X was on very shaky financial ground.
Relying on the bank’s assurance, Hedley Byrne agreed to perform a large order for company X.
However, company X subsequently went out of business without paying Hedley Byrne its fee. In
an attempt to recover its losses, Hedley Byrne sued the bank. It argued that it was wrong for
someone possessing special knowledge to make untrue statements without taking reasonable
care to ensure the accuracy of those statements. The court agreed and invented a new tort known
as negligent misrepresentation. The court stated the following about that tort:
I consider that it follows and that it should now be regarded as settled that if someone possessed of
a special skill undertakes, quite irrespective of contract, to apply that skill for the assistance of another
person who relies upon such skill, a duty of care will arise.10
That reference to a duty of care is crucial to understanding torts involving negligence, as we

will discuss further in Chapter 16. Only people who owe a duty of care to others can commit the
tort of negligent misrepresentation. The courts have held that employers and employees owe a
duty of care to one another during the job recruitment process. The leading Canadian employ-
ment case applying the tort of negligent misrepresentation to the job recruitment process is the
Supreme Court of Canada decision in Queen v. Cognos Inc. (see Box 6.2).

Negligent Misrepresentation in the Job Recruitment Process
Queen v. Cognos Inc. mitted the tort of negligent misrepresentation during the
[1993] 1 SCR 87 interview process.
Key Facts: Queen had a job in Calgary, but was restless. He Issues: Does the tort of negligent misrepresentation apply to
applied for a job with Cognos Inc., a firm located in Ottawa. At the pre-employment recruitment process? If so, did Cognos
the interview, Cognos’s representative, Johnston, explained commit this tort by failing to make clear that the job in ques-
that the job would involve working on a new project, but did tion was contingent on funding yet to be confirmed?
not disclose to Queen that the project was conditional on
funding, which was not guaranteed. Queen was offered the Decision: Yes and yes. The Supreme Court of Canada con-
job. He quit his job in Calgary and moved his family to Ottawa. firmed that negligent misrepresentation was now firmly en-
Queen signed an employment contract with Cognos, which trenched in Canadian tort law:
permitted Cognos to dismiss him for any reason with one
month’s notice. When the funding for the project did not come Though a relatively recent feature of the common
through, Queen was dismissed, about 17 months after he was law, the tort of negligent misrepresentation relied
hired. Queen sued Cognos, alleging that Johnston had com- on and … first recognized by the House of Lords in
negligent misrepresentation: A tort in which party A, owing a duty of care, makes an untrue statement to party B without
sufficient care as to the statement’s accuracy, which party B then relies upon and suffers loss as a result.
duty of care: A special close relationship between two parties that creates an obligation in tort law to take reasonable steps
to avoid harming the other party.

Hedley Byrne … is now an established principle of A duty of care with respect to representations made
Canadian tort law. during pre-contractual negotiations is over and
above a duty to be honest in making those repre-
The court then listed the elements that must be proven to
sentations. It requires not just that the representor
make out a case for negligent misrepresentation:
be truthful and honest in his or her representations.
(1) [T]here must be a duty of care based on a “special It also requires that the representor exercise such
relationship” between the representor and the rep- reasonable care as the circumstances require to en-
resentee; (2) the representation in question must be sure that the representations made are accurate and
untrue, inaccurate, or misleading; (3) the representor not misleading. …
must have acted negligently in making said mis- Under the standard of care described above,
representation; (4) the representee must have relied, Mr. Johnston failed to exercise such reasonable care
in a reasonable manner, on said negligent misrepre- as the circumstances required him to in making the
sentation; and (5) the reliance must have been detri- representations he did during the interview. Particu-
mental to the representee in the sense that damages larly, he should not have led the appellant to believe
resulted. that the Multiview project … was a reality when, in
fact, he knew very well that the most important fac-
The Supreme Court found that the employer’s representa- tor to the existence of the project, as he was describ-
tive had made inaccurate statements to Queen and that Queen ing it, was financial support by the respondent.
had relied on those statements to his detriment. Therefore,
elements 2, 4, and 5 were satisfied. Element 1 was also satisfied Since Johnston kept important information to himself, al-
because a representative of an employer, who the job appli- lowing Queen to form the opinion that the job was secure, he
cant would reasonably believe is speaking on behalf of the acted negligently. It was not a defence that Johnston believed
employer, is in a “special relationship” vis-à-vis the applicant the project would be affirmed. Since all of the elements of the
such that a duty of care arises. tort had been made out, Queen won his tort lawsuit.
The more difficult question in Queen v. Cognos Inc. was The remedial goal in tort law is to put the victim back into
whether the statements made to Queen were “negligently the position they would have been in had the tort not oc-
made” (element 3). The employer representative (Johnston) curred. What likely would have occurred had Cognos not made
testified that he believed the project would go ahead, so that the negligent misrepresentation? Well, Queen likely would
when he told this to Queen, he was speaking honestly. How- not have immediately quit his job in Calgary, which paid
ever, the court noted that Johnston also knew that the project him $50,000 per year. So the court ordered Cognos to pay
still required certain funding approvals that were not guaran- Queen $50,000 in lost income, representing one year’s lost
teed, and he did not pass this important information on to salary. Also, Queen would not have had to buy a house in
Queen. The Supreme Court indicated that this omission Ottawa and then sell it at a loss of about $12,000 when he was
amounted to negligent misrepresentation. The court stated unexpectedly dismissed. The court ordered Cognos to reim-
the following about the test for negligent misrepresentation burse Queen for that loss, as well as pay him an additional
by a prospective employer: $5,000 for “emotional stress.”
Queen won his case because the employer failed to disclose important information that was
known at the time of the job interview—that funding for the position was not guaranteed. It is
important to remember that not every statement made by an employer during the job recruit-
ment process that turns out to be false will amount to a negligent misrepresentation.11 For ex-
ample, if the statements involve guesses or predictions about future events that may or may not
happen, rather than alleged statements of existing fact, a court is unlikely to find a negligent
misrepresentation. The courts assume that employees are capable of understanding that some-
times predictions turn out to be wrong.12
C. Fraudulent or Negligent Misrepresentation by a Job Applicant

So far, we have considered how judges have applied torts to regulate misrepresentations by employ-
ers during the recruitment process. What about job applicants? Sometimes, people looking for work
embellish their credentials to make themselves more attractive to courting employers or to obtain
better contract terms. This too can constitute fraudulent misrepresentation, which occurs if the job
applicant knowingly makes a false representation that induces, or causes, the employer to hire the

applicant. If the employer learns of the dishonesty during the recruitment process,
then usually a legal issue will not arise. The employer will not hire the person. But
what happens if the employer does not learn of the employee’s misrepresentation
until after they have already hired the employee and entered into an employment
contract? This is the scenario that most often arises in the case law dealing with
misrepresentation by employees during the job recruitment process.
In practice, the issue of dishonesty by an employee during the job recruitment
process usually arises in a wrongful dismissal lawsuit brought by a dismissed
employee.13 A wrongful dismissal lawsuit, as we will learn in Chapter 10, alleges
that the employer terminated its contract with the employee without giving the
amount of notice required by the employment contract. Sometimes, an employer
will terminate an employee’s contract when the employer learns that the employee
lied during the job recruitment process (see Box 6.3). In a subsequent wrongful
dismissal case, the employer would argue that the misrepresentation made by the
employee during the job recruitment process voided the requirement for the em-
ployer to give notice before terminating the employee’s contract.14
We see in the Clark decision that dishonesty by a job applicant about an im-
portant fact during the recruitment process can ultimately lead an employee’s con-
tract to be terminated, forfeiting any contractual entitlements. Note that this rule is
applicable even if the employee has worked for the employer for some time before
the employer learns of the dishonesty. The rationale for this rule is that mutual trust
is a fundamental requirement of the employment relationship, and dishonesty of a
serious nature by an employee can irreparably destroy the employer’s trust.15 The
same rationale explains some other common law rules we will meet later in this part
of the text, including judges’ reluctance to reinstate employees to their former jobs,
regardless of how inappropriately the employer had behaved in dismissing the em-
ployee. In the Clark decision, the employee’s misrepresentations had induced the employer to enter
into the contract and influenced the terms of the contract. However, sometimes a job applicant’s
dishonesty may not have any influence on the employer at all. The employer would have hired the
person even if the employee had not made the false claim. What happens then?

Fraudulent Misrepresentation by a Job Applicant
Clark v. Coopers & Lybrand Consulting Group contract without providing notice of termination and without
2002 CanLII 45050 (Ont. CA) paying the bonus?
Key Facts: Clark lied about his academic qualifications in an Decision: Yes. The court ruled that Clark committed fraudulent
application for a job at Coopers & Lybrand Consulting. Im- misrepresentation that had induced the employer to enter into
pressed with his credentials, Coopers & Lybrand offered him a the employment contract. The court cited Professor Gerald
high-level management job. However, a couple of years after Fridman’s text The Law of Contract in Canada when explaining
Clark started, the employer learned of the deception and ter- the implications of this fraud: “A contract resulting from a
minated Clark’s contract with no notice. Clark sued for the fraudulent misrepresentation may be avoided by the victim of
three months’ wages in lieu of notice of termination and a the fraud.” In this case, the court ruled that Clark was not en-
bonus based on a percentage of his earnings, both of which titled to claim any benefit under the contract—including no-
were required by the terms of the contract. tice of termination damages or his bonus—since his lies had
induced the employer to enter into the contract in the first
Issue: Did the employee’s misrepresentations during the job place.
recruitment process entitle the employer to terminate the


Fraudulent Misrepresentation by a Job Applicant Not Relied on by Employer
Islip v. Coldmatic Refrigeration of Canada Ltd. Decision: No. The court ruled that all of the requirements of
2002 BCCA 255 “fraudulent misrepresentation” had been made out—the
worker had deliberately made a false statement about a fact
Key Facts: Coldmatic Refrigeration sought to hire Islip away intending to deceive the employer—except that the employer
from a competitor. It made Islip an offer of employment for a had not been induced to enter into the employment contract
period of two years that included use of a truck and the right by the lie. Coldmatic would have hired the employee anyway,
of Islip to purchase the truck for $1 at the end of the contract. even if he had not lied about his previous salary because it was
During the negotiation stage, Islip informed Coldmatic that he trying to capture the market of Islip’s former employer. It was
was paid $75,000 per year in his current job when in fact he was prepared to pay Islip $75,000 to ensure he came to Coldmatic.
only earning $64,000. Based on that information, Coldmatic The employer argued that the lie was still grounds for dismissal
agreed to pay Islip $75,000. However, shortly thereafter Cold- of Islip for cause (and without notice). The court disagreed,
matic reneged on its promise to sell Islip the truck for $1. Islip finding that “the misrepresentation was not of such a serious
claimed that was a fundamental breach of the contract, permit- nature as to afford grounds for dismissal” without notice.* We
ting him to quit and sue for unpaid wages (this is called a lawsuit will learn in Chapter 12 that not every incident of dishonesty
for constructive dismissal, which we explore in Chapter 13), plus by an employee creates grounds for summary dismissal with-
the value of the truck. Coldmatic argued that Islip committed out notice. The court ordered Coldmatic to pay Islip an amount
fraudulent misrepresentation when he lied about his previous equal to one year’s salary (the contract permitted Coldmatic
salary and therefore he could not claim damages under the to terminate Islip after one year) plus $27,500 to compensate
contract. him for the lost value of the truck.
Issue: Did the employee’s misrepresentation during the job * A similar outcome was reached in Earle v. Grant Transport, 1995 CanLII
recruitment process prevent him from claiming damages for 7289 (Ont. Gen Div). See also Zadorozniak v. Community Futures
breach of contract by the employer? Development Corp., 2005 BCSC 26 (failing to disclose a dismissal for
cause ten years earlier was not cause for dismissal).
IV. Chapter Summary

This chapter explained how, in the common law regime, judges have limited their role to polic-
ing the honesty of representations made by job applicants and employers. Judges have policed
honesty through a mix of tort law (torts of deceit and negligent misrepresentation) and contract
law (fraudulent misrepresentation). The common law regime does not prohibit discriminatory
recruitment decisions, such as giving preference to applicants of a certain gender, race, or reli-
gion. As we will learn in Part III, governments in Canada have filled this void by enacting a
variety of statutes that restrict an employer’s freedom to base hiring decisions on factors the state
deems inappropriate.

1. Amanda believes she was denied a job because of her religion. Can she sue the employer
for discrimination in a common law court?
2. What is the difference between fraudulent misrepresentation and negligent misrepresen-
tation?
3. What is the legal significance of a “duty of care” in cases involving the tort of negligence?
4. What was the employer’s misrepresentation in the case Queen v. Cognos Inc. (described in
Box 6.2)? On what basis did the court calculate damages owing to the employee in that
decision?
summary dismissal: Termination of an employment contract by an employer without notice to the employee in response to
a serious breach of contract by the employee.

APPLYING THE LAW

1. May lied on her application for a job as a bottler sorter offered a new job by Northern Engineering. He asked
at County Beer Company about which university she Northern’s representative about eligibility under
attended. She is hired, but one year later the employer Northern’s LTD plan. Cary was told that he would be
learns of the dishonesty. The employer immediately eligible for LTD provided he completed three months’
fires May, asserting that May’s misrepresentation per- continuous employment without illness. He was given
mits it to terminate the contract with no notice to May. a pamphlet that explained that LTD benefits were
May comes to you for legal advice on whether she can equal to two-thirds of regular monthly income, which
sue County Beer for any damages. What would you tell would be $4,600/month. Cary accepted the job.
her? If there is any other information you would want About one year later, he became sick and claimed LTD
to know before giving your advice, what information benefits. Cary was advised that he was not eligible to
would that be? receive two-thirds of his regular pay because he had
2. Cary is a software engineer who suffers from cystic fi- failed to complete a medical questionnaire when he
brosis. He was laid off from his job at a company was hired. Instead, he was only entitled to a maxi-
called MDA, where he was covered by a long-term mum of $1,000 per month. Cary asks you whether he
disability (LTD) insurance policy that would pay him could file a lawsuit against Northern Engineering and
about $3,000 per month if he became sick and unable tells you he only accepted the job at Northern be-
to work. The job market was good at the time, and cause he thought he had LTD coverage guaranteeing
Cary wanted a new job that would insure LTD benefits him about $4,600 per month. What advice would you
at least equal to what he had at MDA. Cary was give?
EXERCISE
Lawyers “note up” important cases when they prepare to represent their clients. Noting up
involves searching previously decided cases that deal with similar facts and issues to the case
the lawyer is now dealing with. A leading case on negligent misrepresentation during the
recruitment stage is Queen v. Cognos Inc. (described in Box 6.2). Try this exercise on noting up
that decision.

2. In the “Document text” search box, type “Queen v. Cognos” and “employment.” That search
should give you over 500 decisions that cite the Queen decision. Not all of these decisions
will involve alleged misrepresentations during the employment recruitment process, but
some will.
3. Scroll through the decisions and look for a case that involves an alleged misrepresentation
by an employer or job applicant in the recruitment process. Read that decision.
4. Prepare a case summary similar to that presented in Box 6.2, including a brief summary
of (1) the key facts; (2) the main issue the court was asked to decide; and (3) the court’s
decision and the remedy (if any) ordered.

1. Christie v. The York Corporation, [1940] SCR 139 at 142. 4. In recent years, some courts in Canada have ruled that it is
2. Ibid. at 141. possible to include a claim for breach of a human rights
statute as part of a lawsuit for breach of the employment
3. For an interesting discussion of Christie v. York, see E.
contract, such as a claim for “wrongful dismissal,” which
Adams, “Errors of Fact and Law: Race, Space, and Hockey
we will discuss in Chapter 14. See, e.g., Sparrow v. The
in Christie v. York” (2012) 62 UTLJ 463.
Manufacturers Life Insurance Company, 2004 MBQB 281.

In Ontario, the Human Rights Code, RSO 1990, c. H.19, 12. See, e.g., Grant v. Oracle Corp. Canada Inc., 1995 CanLII
s. 46.1 now grants courts the authority to order remedies 16090 (Man. CA); Bureau v. KPMG Quality Registrar Inc.,
for violations of the Code as long as a violation of the 1999 CanLII 1479 (NSCA); Williams v. Board of School
Code is not the sole basis for the lawsuit (s. 46.1). For an Trustees, School District No. 63, 1986 CanLII 1207 (BCSC);
example of a case that applies s. 46.1, see Wilson v. Solis and Demichelis v. Vancouver Canucks Limited Partnership,
Mexican Foods Inc., 2013 ONSC 5799. 2014 BCSC 1368.
5. Modern courts often treat the tort of deceit and fraudu- 13. In Leacock v. Whalen, Beliveau & Associes Inc., 1998
lent misrepresentation interchangeably, although they are CanLII 6452 (BCCA), the employee’s negligent misrepre-
distinct causes of action. Deceit is a tort, an element of sentation during the hiring process resulted in the court
which is a fraudulent misrepresentation. Fraudulent mis- redefining the duration clause of the contract. The em-
representation is actually an action in contract law that ployee had been fired after three months. He argued that
arises when a party to a contract was induced to enter his contract was for two years, and that he was entitled to
into the contract by a fraudulent statement. The innocent damages amounting to the pay he would have received had
party may rescind the contract, in addition to seeking he worked those two years. In its defence, the employer
damages. For a good discussion of this distinction, argued that the employee had misrepresented his qualifica-
including other sources, see Lozinik v. Sutherland, 2012 tions during the recruitment process. The court agreed,
ABQB 440. ruling that the employee had committed the tort of negli-
6. G. Fridman, The Law of Contract in Canada, 3rd ed (Scar- gent misrepresentation by being “less than frank” about his
borough, ON: Carswell, 1994) at 295. sales performance at his previous job. The court then con-
sidered what remedy would make the employer whole, the
7. For a discussion of this tort, see A. Linden, L. Klar, and
same test applied in Queen v. Cognos Inc., [1993] 1 SCR 87.
B. Feldthusen, Canadian Tort Law: Cases, Notes & Ma-
It found that had the employee not misrepresented his
terials, 13th ed (Toronto: LexisNexis, 2009) at chapter 10.
qualifications, the employer would still have hired
8. Hedley Byrne & Co. v. Heller & Partners, [1964] AC 465. Leacock. However, the employer would have bargained a
9. For cases applying negligent misrepresentation in the contract term of only one year, rather than two years.
recruitment context, see H.B. Nickerson & Sons Ltd. v. Therefore, the court assessed the damages for the wrongful
Wooldridge, 1980 CanLII 2604 (NSCA); Steer v. Aerovox dismissal based on a one-year contract.
Inc., 1984 CanLII 49 (NSSC); De Groot v. St. Boniface 14. See, e.g., Schafer v. Pan Matrix Informatics Inc., 1987
General Hospital, 1994 CanLII 16687 (Man. CA); Kha- CanLII 3500 (Alta. QB) (eight lies by the employee during
shaba v. Procom Consultants Group Ltd., 2018 ONSC 7617; the hiring process amounted to cause for summary dis-
and Feldstein v. 364 Northern Development Corporation, missal); Clark v. Coopers & Lybrand Consulting Group,
2017 BCCA 174. 2002 CanLII 45050 (Ont. CA); and Cornell v. Rogers Cable-
10. Hedley Byrne, supra note 8 at 15. systems Inc. (1987), 17 CCEL 232 (Ont. DC).
11. See Lesage v. Canadian Forest Products Ltd., 2011 BCCA 15. See D. Doorey, “Employer Bullying: Implied Duties of Fair
259 (the failure to warn the employee of the possibility of Dealing in Canadian Employment Contracts” (2005) 30
the job being eliminated in the future was not negligent Queen’s LJ 500 at 523-24; and Smith v. Reichhold Ltd., 1989
misrepresentation). CanLII 2875 (BCCA) (employee conduct that destroyed
an employer’s trust repudiates the employment contract).


CHAPTER 7
The Requirements to Create and

Modify an Employment Contract
II. The Requirements to Create a Legally Enforceable Employment Contract 98
• Explain when a contract between an employer and an
A. Capacity to Enter into a Contract 98
“infant” or a person with a mental impairment is
B. Intention to Create a Legally Enforceable Contract 98
legally enforceable.
C. Three Elements of a Contract: Offer, Acceptance, and Mutual Consideration 100
• Explain when the intention to create a legally III. Making Modifications to an Employment Contract 102
enforceable contract exists.
A. Contract Amendments When the Employee Agrees to the Change 103
• Define offer, acceptance, and mutual consideration, and B. Modifications When the Employee Does Not Agree to the Change 107
explain their significance in employment contracts. IV. Chapter Summary 109
• Explain how modifications can be made to an Questions and Issues for Discussion 109
employment contract. Notes and References 110
I. Introduction
The successful outcome of the job recruitment process discussed in Chapter 6 is an employment
contract between an employer and an employee. Therefore, we have reached the point in the
book when we must turn our attention to the rules of contract law. In this chapter, we consider
the requirements to create a valid and enforceable employment contract, as well as the rules
governing amendments or variations to those contracts.
The essence of an employment contract is an exchange of a promise by the employee to per-
form work for a promise by the employer to pay for that labour. The common law regime pre-
sumes that employers and employees are informed, rational actors who voluntarily choose to
enter into employment contracts because doing so makes them better off than they otherwise
would be without the contract. This presumption breaks down, however, if one or both of the
parties lack the capacity to fully grasp the consequences of the bargain, or if the parties never
intend the arrangement to create legal obligations. I may offer to pay my 10-year-old daughter
$5 in exchange for her cleaning the kitchen, but neither of us would intend that we can drag the
other to court if she leaves the kitchen a mess or I refuse to pay up. We need to understand when
a promise creates legal obligations.
As explored in Chapter 5, the model of employment contracts we understand today really
only emerged in Canada during the 20th century. An important implication of the courts’ move
to treat the labour exchange as a form of contract was that the general rules of contract law
applied. We will learn in Chapter 9 that the courts used “implied terms” to create a special type
of contractual relationship that largely preserved the authority of employer over employee that
had existed in the master and servant era. However, the general rules of contract law have
shaped many of the core elements of the employment relationship, including the requirements
of offer, acceptance, and mutual consideration that we consider in this chapter. These
97

r equirements determine whether a valid employment contract has been created and also shape
the rules regarding contract term modifications. There is a lot to cover, so let’s begin our lesson
in contract law!
II. The Requirements to Create a Legally Enforceable Employment

Contract
We will divide our discussion of the requirements to create a legally enforceable contract into
three parts: (1) capacity to contract; (2) intention to contract; and (3) the elements of a con-
tract—offer, acceptance, and mutual consideration. Each of these requirements must be satisfied
for a promise of labour for money to be treated as a lawful employment contract.
A. Capacity to Enter into a Contract

As noted in the introduction, the common law presumes that a contract results from a meeting
of the minds of two free and informed parties who have assessed that they will benefit from the
exchange. The law needs to guard against exchanges where one of the parties lacks the capacity
to understand the implications of the deal. Should a child be able to enter into an employment
contract? It is easy to see why we might be concerned about this possibility. Children may not
understand what it means to enter into a contract or what they are actually agreeing to. They
could be taken advantage of. To guard against this possibility, the courts could prohibit—or
refuse to enforce—all contracts with minors or persons with mental disabilities. However, that
is not the approach that has been taken.
In the case of children under the age of 18 (called infants or minors in legal terminology), the
courts begin with the assumption that the contract is void. However, exceptions have been rec-
ognized by the courts (and sometimes by governments in legislation)1 in which employment
contracts with infants are enforced. The most important exception relates to a contract that,
overall, is for the benefit of the infant.2 If it is, then it is enforceable. Few modern cases involving
infant employment contracts exist, but one is a case involving John Tonelli, who won four Stan-
ley Cups with the New York Islanders hockey team in the 1980s (see Box 7.1).
We noted in Chapter 1 that some of the vilest and most disturbing snapshots in the story of
the Canadian law of work involve abuse and mistreatment of child workers in late 19th-century
factories.3 By requiring employers to establish that a contract with a minor is for the minor’s
benefit, the courts retain some ability to police child exploitation at work. Contracts involving
employees with a mental impairment are treated in a similar manner. They are considered to be
voidable contracts. This means that they are not automatically void. However, if a court finds
that the mentally impaired party was unaware of what was being agreed to, or that the contract
is very unfair, it may void the contract.4
B. Intention to Create a Legally Enforceable Contract

Assuming that we have two parties that have the legal capacity to contract, the next issue is
whether they actually intend to create a legally enforceable contract. Judges do not want people
dragging each other to court over every little promise made in everyday interactions. In the
beautiful language of Lord Stowell in an 1811 decision: “[Contracts] must not be the sport of an
idle hour, mere matters of pleasantry and badinage, never intended by the parties to have any
serious effect whatever.”5 In other words, I should not be able to sue my daughter because she
forgot to load the dishwasher as we agreed.
infant: A person under the age of 18; also referred to as a minor in legal writing.
voidable contract: A contract that may be declared void at the option of one of the parties due to a deficiency. An example
is an employment contract involving an employee who is considered mentally impaired.

Chapter 7 The Requirements to Create and Modify an Employment Contract 99

The Enforceability of an Employment Contract Involving a Minor
Toronto Marlboro Major Junior “A” Hockey Club v. Tonelli The court ruled that, although Tonelli received benefits
1979 CanLII 1969 (Ont. CA) from the contract, overall the contract was onerous for him
and highly beneficial to the Marlboros. The court noted that
Key Facts: At age 17, Tonelli entered into a contract with the “where, as here, the bargaining position of the parties is mani-
Toronto Marlboro junior hockey team. It required him to play festly unequal and one party is able to dictate terms to an-
for the Marlboros for three years, and then pay the team 20 other, courts are increasingly vigilant to protect the weaker
percent of his hockey earnings for his first three years of profes- party and reluctant to enforce the contract against him.”
sional hockey. In exchange, the Marlboros provided Tonelli
with a small wage, paid for his room and board and school
tuition, and gave him coaching, exposure, and a chance to
make the pros. When Tonelli turned 18, he informed the Marl-
boros that he was cancelling the contract. He signed with the
Houston Aeros, a professional hockey team. Tonelli argued that
the contract with the Marlboros was invalid because he was a
minor when he signed the agreement.
Issue: Was the contract “for the benefit” of the 17-year-old

Tonelli and therefore legally enforceable?
Decision: No. The contract was unenforceable. The court ex-

plained the legal test for contracts with people under the age
of 18:
This contract, signed by Tonelli when he was an in-

fant, falls into the category of a contract of service.
It can be enforced against him only if it was for his
benefit at the time it was made. The onus is on the
Marlboros to establish that it was for his benefit.
Whether it was or was not for the infant’s benefit is
a question of fact. … In making its decision, the
Court must construe the contract as a whole and
strike a balance between its beneficial and onerous
features. The contract is not to be invalidated simply
because it places some burdens upon an infant.
These principles of law are well established, and no John Tonelli.
authority need be cited to support them. Source: Ray Stubblebine/AP.
In assessing whether there was an intention to create a legal contract, judges ask whether a
“reasonable person” would assume that the intention existed, considering all of the facts. Let’s
pause here to note that this is known as an objective test. It asks, “What would a reasonable
person of normal intelligence think, if told about the circumstances?”6 A subjective test, in
contrast, asks, “What was this person actually thinking at the time?” Through the application of
an objective test, a judge can find that an intention existed to create a legally enforceable contract
even if one of the parties claims that they did not actually have that intention. We will come
across objective and subjective tests again later in this text.
objective test: A legal test used in interpretation of contracts and statutes that asks, “What would a reasonable person of
normal intelligence think, if told about the circumstances?” Contrast with subjective test.
subjective test: A legal test used in interpretation of contracts and statutes that asks, “What was this person actually thinking
at the time?” Contrast with objective test.

An intention to create legal relations is usually assumed in the typical employment relation-
ship involving an employer who offers a job to an employee, but not always. For example, con-
sider a situation that may be familiar to many students: the unpaid internship. Often companies
offer to permit a person to shadow an employee or do a variety of tasks as a way to gain experi-
ence and connections, but without an offer to “employ” or pay wages. Has an employment
contract been created in such a situation? See Box 7.2 for a discussion of this issue.
The Sarmiento case demonstrates that the common law regime is not very helpful to unpaid
interns, volunteers, or trainees who agree to work for free in exchange for experience but then
later argue that they were really “employees” and subject to an employment contract. Therefore,
workers in this situation have more often looked to the regulatory standards regime, especially
employment standards legislation, as the worker did in the Pichette v. Lumac Holdings case dis-
cussed in Box 4.7 in Chapter 4.7

The Intention to Create a Binding Employment Contract
Sarmiento v. Wilding & Rampage Entertainment of training, she took on the mantle of paid em-
2008 BCPC 232 ployee. Nothing in the evidence showed that the
relationship between the parties changed or that
Key Facts: Sarmiento was looking for experience in the film there was any consideration indicative of the parties
industry and agreed to volunteer as an intern with Rampage, entering into an employment contract …. Quite
a small film production company. After she stopped working apart from whether Sarmiento was an employee or
for the company, she filed a lawsuit claiming that she had been intern, I find the evidence does not support holding
“hired” as an employee and was owed $25,000 for the work that [Sarmiento] and Rampage had a common in-
she performed for the company. tention to enter into an employment contract. With
Issue: Did the parties enter into a legally enforceable contract the funding structure and limited financing behind
requiring the payment of wages to the worker for work Rampage, I am unable to conclude [the company]
performed? was looking to hire staff or that [it] employed
Sarmiento in the capacity she wanted the Court to
Decision: No. The court accepted the company’s argument believe.*
that Sarmiento had agreed to volunteer and that no mutual
intention to create legal relations had existed:
* See also Evard v. University of BC (Alma Mater Society) (1995), 14 CCEL
(2d) 124 (BCSC) (a student university newspaper editor was not entitled
The evidence does not show Sarmiento was “hired” to compensation because there was no intention to create a legally
to work for Rampage generally or that after a period enforceable contract).
C. Three Elements of a Contract: Offer, Acceptance, and Mutual Consideration

Finally, even if two parties have the capacity to contract and intend to create a legally enforceable
contract, they may still fail to create a valid, legally enforceable contract. Common law judges
determined very long ago—long before employment contracts existed—that for any agreement
to become a legally binding contract, an offer must be made by one party that is accepted by an-
other party, and mutual consideration must exist between the parties. These requirements apply
to employment contracts in Canada today.
1. Offer and Acceptance

In the case of an employment contract, the first two requirements of offer and acceptance are
usually satisfied without much controversy. In the usual course, an employer will offer to
employ a worker, and the worker will accept that offer. The acceptance must be unequivocal

such that both parties understand that they are entering into a binding contract. Consider a
typical “offer letter” that an employer might send to a prospective employee, as depicted in
Box 7.3.
Since the offer letter in Box 7.3 expressly and clearly indicates that the employee’s signature
constitutes acceptance of both the offer letter and the attached contract of employment, there
should be little dispute about what was offered and whether the employee accepted it.8
However, sometimes it is less clear what the employer offered or whether the employee
accepted the offer. In many cases, no written contract or offer setting out what the contract’s
terms will be is used. In such cases, the evidence that an offer was made by one party and
accepted by another must be gleaned from the conduct of the parties or from oral testimony or
other documentary evidence put before a judge that describes what the parties discussed. In
Box 7.5, later in this chapter, we consider a case in which a judge was asked to decide whether a
verbal offer of employment was made and accepted during a telephone conversation.

The Offer and Acceptance of an Employment Contract
Dear Ms. Cheng:
We are pleased to offer you employment at County Beer Company commencing on

Monday, January 20, 2020.
As an employee of County Beer, you are entitled to coverage under our employee
health plan after completion of three months’ continuous employment. Please find
attached our standard Contract of Employment, which together with this offer letter,
constitutes your employment contract. You should review the terms in that contract
and consult a lawyer if you wish. Provided the terms are acceptable to you, please verify
your acceptance of our offer of employment by signing on the space provided below.
This offer of employment is open until 5 p.m. on Friday, January 17, 2020. If you have
not returned a signed acceptance of this offer by that time, this offer expires.
We are excited to have you aboard! County Beer is a modern, friendly, great place to
work with a lot of opportunities to advance for hard-working, positive employees.
Sincerely,
Dylan L. Wilson
Dylan L. Wilson
Director of Human Resources
I ___________________ have read this offer letter and the attached Contract of
Employment. I have sought legal advice or have elected voluntarily not to seek legal
advice to review the contents of the contract. My signature below indicates my
acceptance of this offer of employment and the terms set out in this offer letter and the
attached Contract of Employment.
____________________________ ____________________________
Employee’s Signature Date

2. Mutual Consideration
“Consideration” means something of value or a benefit. Therefore, when we say that an employ-
ment contract must contain mutual consideration, we mean that it must provide something of
value to both the employer and the employee that they otherwise would not receive. The consider-
ation need not be equal to both parties. In fact, the courts have said that they will “not enter into
an inquiry as to the adequacy of consideration” and “anything of value, however small the value,
is sufficient consideration to support a contract at law.”9 Law students learn early in their con-
tracts course about the case of Chappell & Company v. Nestle, in which the British House of
Lords famously wrote “A peppercorn does not cease to be good consideration if it is established
that the promisee does not like pepper and will throw away the corn.” My contracts professor
used to yell at us, “Where is the peppercorn!” whenever a question of mutual consideration
arises in a case.10 My law school touch football team was called the Raging Peppercorns. You get
the idea. Mutual consideration is important.
The requirement for mutual consideration rarely creates a problem at the time an employ-
ment contract is first created. It is easy to see how consideration would normally flow both ways
in a typical employment relationship. The employee receives money (a wage) and perhaps some
other benefits, such as health or dental insurance or pension contributions. In exchange, the
employer receives the employee’s labour power and a promise to comply with legally permissible
directions issued by the employer.
However, the requirement of mutual consideration applies to contract modifications (or
amendments) as well. It is in this context that problems occasionally arise. For a change to a
contract to be legally enforceable, both employee and employer must receive something new of
value that they were not otherwise already entitled to under the existing (prior) contract. Can-
adian employers have sometimes run into problems when they have attempted to make a change
to an employment contract that would benefit the employer without also giving a new benefit
to the employee. In that case, as we will see next, the amendment can be ruled invalid for lack
of “fresh” consideration to the employee, even if the employee agreed to the change.
III. Making Modifications to an Employment Contract

Competing policy interests are in tension in the law that regulates mid-term contract modifica-
tions. On the one hand, good policy reasons exist to allow employers “flexibility” in governing
the workplace in order to adapt quickly to changes in the business environment. It is impossible
to predict all of the circumstances that could arise during the life of an indefinite-term employ-
ment contract. If terms of employment are fixed by contracts entered into months or even years
earlier, the employer’s ability to adapt to new market demands is impeded, which could threaten
the viability of the business.
On the other hand, employees have an interest in predictability and stability in their employ-
ment conditions. If employers can simply change the contract terms whenever it suits them,
then the original contract terms that employees accepted would be meaningless. Fear of repri-
sals may lead employees to agree with whatever changes the employer proposes, since employ-
ers can always terminate the contract simply by giving notice. The requirement for mutual
consideration to modify a contract provides a small measure of protection for employees against
an employer that might want to force through contract changes that benefit the employer.
The requirement for mutual consideration to amend a contract dates back to the famous 1809
contract case of Stilk v. Myrick, discussed in Box 7.4. Stilk v. Myrick took place two centuries ago,
but it is not hard to see how the rule applied in that case is still relevant to modern-day employ-
ment situations. At its core, Stilk v. Myrick is an employment case in which the parties agreed to
amend the contract terms in the middle of the contract. However, the amendment was unen-
forceable because “new consideration” did not flow to both parties.


The Origins of Mutual Consideration in Employment Contracts
Stilk v. Myrick Decision: No. In the original contract for 5 pounds per month,
(1809), 170 ER 1168 the seamen had already agreed to perform “all that they could
under all the emergencies of the voyage” and were bound “to
Key Facts: Stilk agreed to work as a seaman on a dangerous exert themselves to the utmost to bring the ship in safety to
sea voyage for 5 British pounds per month. Two other seamen her destined port.” Sometimes things happen on a voyage that
deserted the ship, creating more work for Stilk on the return create more work for the crew, and the original contract con-
voyage. The captain (Myrick) offered to pay Stilk more for the templated that. Therefore, Myrick received nothing new in
return voyage for the additional work that would be required. exchange for his promise to pay Stilk more than the original 5
However, when the voyage was done, Myrick refused to pay pounds. As a result, because he received no “new considera-
Stilk the additional amounts he had promised. Stilk sued to tion,” Myrick’s promise to pay Stilk more than 5 pounds per
recover that money. month was not an enforceable agreement.
Issue: Was the captain’s promise to pay Stilk more than agreed
to in the original contract enforceable?
In the Stilk case, it was the purchaser of the labour (the “employer,” Myrick) who benefited
from the rule. More often today the rule benefits employees. A typical situation involves an em-
ployer that wants to amend or vary the terms of the employment contract, such as by reducing
employee compensation or the amount of notice required to terminate the contract. It is pos-
sible for an employment contract to include expressed language that explains how a mid-term
amendment can occur. For example, a contract might include a term like this:
The Contract may be modified or changed in whole or part according to the will of the parties, but
all such changes or modifications must be agreed to and shall not take effect until they are in writing
and signed by both parties.
That language requires both parties to agree to the change and therefore, in theory at least,
gives the employee the right to veto any change by withholding consent to a proposed change.11
If a contract includes a clause like that, then new consideration would not be needed to make
the amendment, since mutual consideration was exchanged at the time the contract was initially
formed.
However, most employment contracts do not include expressed language dealing with
mid-term contract amendments. Therefore, the normal common law rules of contract apply,
and the Stilk decision tells us that an amendment to an employment contract without an
expressed variation clause is only enforceable if (1) both parties agree to the change, and (2)
both parties receive new consideration—some new benefit not required by the original contract.
We can separate the contract modification rules into two categories: (1) modifications with
agreement of both parties, and (2) modifications when one party does not agree to the change.
A. Contract Amendments When the Employee Agrees to the Change

In order to understand the next two cases, which deal with attempted amendments to employ-
ment contracts, you need to know something about a topic we will discuss in detail in Chapters
9 and 10. In the common law regime, there is an “implied” obligation on employers to provide
employees with “reasonable notice” of the termination of the employment contract. “Implied”
means that the requirement to give reasonable notice exists, unless there is a term in the contract
that expressly states otherwise. Judges decide how much notice is “reasonable,” applying criteria
we consider in Chapter 10.

For now, all you need to know is that reasonable notice can be quite a lengthy period of time
(up to two years or more for a long-serving employee). Therefore, employers often seek to avoid
implied reasonable notice by including a written contract term requiring a defined amount of
notice that is less than “reasonable notice.” The next two cases involve attempts by employers to
introduce a new written notice of termination clause to replace the existing implied requirement
to provide reasonable notice of termination.
Rejdak v. Fight Network Inc., discussed in Box 7.5, provides a useful demonstration of
how the requirements of offer, acceptance, and mutual consideration come into play in the
employment setting, including in the context of a contract amendment. Let’s consider it in two
parts, separating out the issues of offer and acceptance, and mutual consideration.

Offer, Acceptance, and Mutual Consideration
Rejdak v. Fight Network Inc. ment. I conclude that there was an oral employ-
2008 CanLII 37909 (Ont. Sup Ct J) ment contract entered into by the parties on Friday
evening.
Key Facts: Rejdak argued that a verbal offer of employment
was made by The Fight Network (TFN) in a Friday night tele- Issue Two (Mutual Consideration): Did the parties lawfully
phone conversation. The terms of that contract included the amend the oral contract when they signed the written contract
salary amount, job title, and start date. There was no discus- on the second day of work?
sion of how much notice of termination would be required.
Rejdak accepted the offer, quit his existing job, and began Decision: No. According to the judge, the employee received
work at TFN the following Monday. During that first day, TFN no new consideration in exchange for granting the employer
gave Rejdak a written employment contract and asked him the benefit of a new probationary period:
to sign it. Rejdak took the written contract home and returned
Mr. Rejdak’s position is that the written employment
it signed the following day. The written offer allowed the em-
agreement is of no force or effect because there was
ployer to terminate Rejdak’s employment with no notice while
no fresh consideration. … TFN submits that the em-
he was on “probation.” Rejdak’s contract was terminated dur-
ployment agreement signed on August 9, [2005],
ing the probation period without notice. Rejdak sued the
provided two benefits to Mr. Rejdak which consti-
employer, arguing that the original verbal contract included
tute new consideration. The first added benefit was
an implied right to “reasonable notice” of termination and that
paid vacation. The agreement provided that Mr.
the written contract with the probation period was unen-
Rejdak would be entitled to two weeks’ vacation. If
forceable because he received no fresh consideration in ex-
he did not take all of his vacation in a particular year,
change for giving up his greater entitlement to reasonable
he could carry up to one-week vacation into the
notice.
next year. The second benefit under the contract
Issue One (Offer and Acceptance): Did the parties enter into was a health benefit plan: Mr. Rejdak was entitled to
a verbal employment contract during the Friday night tele- participate in TFN’s employee benefit plan or a pri-
phone conversation? vate plan, if no employee plan existed. …
I do not accept that either benefit constitutes
Decision: Yes. A verbal offer was made during the phone call, additional consideration. The paid vacation merely
which was accepted by Rejdak. The judge wrote: reflects the two-week statutory minimum [already
required by the Employment Standards Act].
I conclude that on [Friday] August 5, [the employer] Mr. Rejdak would reasonably have expected to re-
offered and Mr. Rejdak accepted a job on the fol- ceive the health benefit plan since it was a standard
lowing terms: his title was editor and creative dir- benefit provided to all TFN employees.
ector; his annual salary was $50,000; and he was to
start on Monday, August 8, 2005. There was no The court found that the original oral contract required
indication on August 5 that his employment was that the employer provide Rejdak with “reasonable notice,”
subject to a probationary period. Mr. Rejdak began which the court ruled was four months. Rejdak was entitled
work at TFN prior to signing the employment agree- to damages based on lost wages for a period of four months.

Rejdak v. Fight Network Inc. offers three important lessons about the common law rules of
contract. First, amendments to an employment contract are only enforceable if there has been
mutual consideration.12 Second, a verbal offer by an employer to employ a job applicant
can create an enforceable employment contract if the worker accepts the offer; a written
contract is not necessary, and indeed, many employees in Canada have never signed a
written contract.13 Third, if an employee commences work before having signed a written
employment contract, then a written contract introduced afterward constitutes a proposed
modification to the original verbal contract, and unless the parties had agreed otherwise, that
verbal contract includes an implied requirement that the employer provide the employee with
“reasonable notice” of termination.
In the decision outlined in Box 7.6, the employee had signed an offer of employment one
month before he commenced work and was then instructed to sign a written contract on his first
day of work. The written contract limited the amount of notice the employer was required to
give if it decided to terminate the contract.
Notice that in both Francis v. CIBC and Rejdak v. Fight Network, the employees signed the
new written contracts, yet the courts ruled that the notice of termination clauses in those con-
tracts were unenforceable due to a lack of fresh consideration. An employee’s written agreement
does not fix an absence of mutual consideration.

New Consideration Needed to Modify a Contract
Francis v. Canadian Imperial Bank of Commerce Issue: Was the amendment to the notice of termination pro-
1994 CanLII 1578 (Ont. CA) vision in the employment agreement enforceable?
Key Facts: Francis was given an offer of employment letter Decision: No. The court ruled that the employment agreement
from CIBC on June 9, 1978, which he accepted in writing sev- signed on the first day of work in July 1978 modified the earlier
eral days later. That agreement included no provision about contract reached by the parties in June. That modification
notice of termination, and, therefore, it included an implied granted the employer an important new benefit—the right to
contract term requiring “reasonable notice” of termination. On terminate the contract with three months’ notice rather than
July 4, 1978, his first day of work, CIBC presented him with a “reasonable notice,” which would be much longer than three
new document entitled “Employment Agreement.” That docu- months. There was nothing new in the written contract that
ment said that CIBC could terminate the contract by giving benefited Francis that he was not already entitled to as per the
Francis three months’ notice. Francis signed it and commenced original written employment offer that he accepted one
work. When Francis was dismissed in 1987, CIBC relied on the month before his first day on the job. Francis was entitled to
“three months’ notice” term in the written employment agree- reasonable notice of termination, as per the original contract
ment. Francis sued for wrongful dismissal, arguing that the executed in June 1978. The court determined that notice per-
notice clause in that agreement modified the original contract iod to be 12 months. Therefore, Francis was entitled to dam-
that entitled him to “reasonable notice” and that he had re- ages based on a period of 12 months from the date he was
ceived no new consideration. dismissed.
In a 2018 decision, the British Columbia Court of Appeal ruled that mutual consideration
was no longer required to lawfully amend a contract, provided that both parties agreed, there
was no “duress,” and there is no other policy reason why the amendment should not be

enforced.14 That decision, called Rosas v. Toca, did not involve an employment relationship, and
as I write this in early 2019, there has been no decided case involving an employment contract
that applies its reasoning. Regardless of whether the novel approach in Rosas v. Toca takes hold
in other contexts, there is good reason to believe that courts will preserve the requirement for
mutual consideration in the employment context owing to the inequality of bargaining power
between employer and employee that courts have long recognized and that we will discuss
throughout this book. This inherent inequality is discussed in Box 7.7.

How Inequality of Bargaining Power Affects the Common Law
The Francis v. CIBC ruling has been applied in many subsequent remuneration of the new job, they become more
cases in which employers attempted to rely on amended terms vulnerable.*
of employment contracts even though the employee had re-
ceived no new consideration in exchange for the amendment. The court was recognizing here that employees often will
In one such case, called Hobbs v. TDI Canada Ltd., the Ontario not feel free to refuse an employer’s demand for a contract
Court of Appeal referred to the inequality of bargaining power modification since a refusal could possibly lead to their dis-
common in the employment relationship: missal. The theme of inequality of bargaining power is prom-
inent in the law of work, as we discussed in Part I of this text.
The requirement of consideration to support an The requirement for the employee to receive something of
amended agreement is especially important in the value (consideration) in the amendment provides some small
employment context where, generally, there is measure of protection for the employee. However, since the
inequality of bargaining power between employ- courts do not assess the value of consideration or insist that
ees and employers. Some employees may enjoy a employees receive “fair” value in the exchange, the requirement
measure of bargaining power when negotiating for mutual consideration is not a very onerous hurdle for em-
the terms of prospective employment, but once ployers to overcome.
they have been hired and are dependent on the
* Hobbs v. TDI Canada Ltd., 2004 CanLII 44783 (Ont. CA) at para 42.
Some employers have argued that simply continuing to employ the employee constitutes new
consideration in exchange for a contract modification. In other words, the employer says, “I
could fire you right now, but I won’t if you agree to this amendment.” The problem with this
argument is that the employer is already required to continue the employment contract, unless
it provides the employee with the amount of notice to terminate it required in the contract. In
Globex Foreign Exchange Corporation v. Kelcher, the Alberta Court of Appeal explained why
continued employment alone is not fresh consideration:
[C]ontinued employment alone does not provide consideration for a new [benefit to the employer]
extracted from an employee during the term of employment because the employer is already required
to continue the employment until there are grounds for dismissal or reasonable notice of termination
is given.15
However, what if the employer goes further, and says, “If you agree to this modification, I
promise not to exercise my contractual right to terminate the contract not only today, but also
for some period of time into the future”? Could this exchange provide the employee with a new
benefit: greater job security than they had the moment before they agreed to the modification?
The courts call a promise not to exercise a right to terminate the contract for a future period of
contract modification: A change to one or more terms of the contract during the term of the contract.

time a forbearance. Forbearance can constitute new consideration to support a contract modi-
fication, as discussed in the decision in Box 7.8.16

Is a Promise Not to Terminate a Contract for a Specified Time Fresh Consideration?
Techform Products Ltd. v. Wolda Issue: Did Wolda receive fresh consideration in the form of an
2001 CanLII 8604 (Ont. CA) agreement by Techform to abstain from exercising its right to
give 60 days’ notice of termination?
Key Facts: In 1989, Wolda signed a consultancy agreement with
Techform to work on special projects at a fixed hourly rate that Decision: Yes. The court ruled that it was clear that had Wolda
could be terminated with 60 days’ notice. In 1993, Techform not signed the ETA contract, Techform would have exercised
asked Wolda to sign a new contract (the ETA contract) that its rights under the consultancy contract to terminate Wolda
granted ownership to Techform of inventions Wolda created with 60 days’ notice. The court of appeal concluded that there
while working for Techform. Wolda did not want to sign, but felt was evidence that
he had no choice because Techform made clear that it would
terminate his consultancy contract if he refused to sign, and he if Wolda did not sign the ETA his services would be
needed the work. In 1997, Wolda invented a “3D hinge” and he terminated on 60 days’ notice. In presenting the ETA
requested that Techform pay him a royalty for each sale. This to Wolda in the circumstances of this case, Techform
annoyed Techform, which claimed they owned the invention must be taken to have tacitly promised to forbear
because of the ETA contract. After Techform terminated the from dismissing the employee for a reasonable period
consultancy contract, the two sides sued one another. Wolda of time thereafter. That promise was in fact fulfilled.
argued that he owned the 3D hinge and that the ETA contract The appellant retained the respondent’s services for
was unenforceable because he had received no fresh consider- a further four years and terminated those services
ation when it was signed in 1993. Techform argued that Wolda only when he breached the ETA. In my view, there-
received consideration in the form of an agreement by Techform fore, there was consideration for the ETA. [Emphasis
not to exercise its right to terminate the consultancy agreement added]
with 60 days’ notice for some period into the future.
In the cases we have considered so far, the worker agreed to the modification and the issue was
whether there was consideration flowing back to the employee. Only in Wolda did the court find
fresh consideration, and it took the form of a promise by Techform to not exercise its contractual
right to terminate Wolda for some period of time into the future—a forbearance. More often, an
employer will just give the employee something small of value, such as a signing bonus or a pay
raise. For example, in the 2018 case Lancia v. Park Dentistry, the employer introduced a new,
revised employment contract and, in consideration for employees signing, provided a one-time
$2,000 bonus.17 The court ruled that this was valid consideration.
B. Modifications When the Employee Does Not Agree to the Change
What if the employee does not agree to the employer’s proposed contract modification? What if
the employer says, “We want you to agree to this change to the contract” and the employee says,
“No thanks”? This scenario arose in the 1957 case of Hill v. Peter Gorman Ltd. The employer
announced to salespeople that it was going to begin withholding part of their commissions to
forbearance: A promise by one party in a contract to another party to refrain from exercising a contractual right for a period
of time. A forbearance by an employer to not exercise the contractual right to terminate the employment contract may constitute
consideration flowing to an employee.

offset delinquent accounts. This act constituted a modification to the contract. Hill refused to
accept the modification, but the employer nevertheless withheld his commissions. When the
employee later quit, he sued and successfully recovered the withheld commissions. The court of
appeal ruled that, when faced with an employee who does not agree to a proposed modification,
the employer can terminate the contract in its entirety by giving proper notice, and then offer a
new contract on revised terms, but it cannot unilaterally impose the modification:
If the [employee] made it clear … that he did not agree to the change … the proper course for [the
employer] to pursue was to terminate the contract by proper notice and to offer employment on
the new terms. Until it was so terminated, the [employee] was entitled to insist on performance of
the original contract.18
A similar situation arose in the more recent case of Wronko v. Western Inventory Service Ltd.
(see Box 7.9).
The basic lesson from Hill v. Gorman and Wronko v. Western Inventory is that an employer
cannot simply impose a modification to an employment contract without the employee’s

When No Agreement Exists to Modify an Employment Contract
Wronko v. Western Inventory Service Ltd. First, the employee may accept the change in the
2008 ONCA 327 terms of employment … in which case the employ-
ment will continue under the altered terms.
Key Facts: The employment contract, dated December 2000, Second, the employee may reject the change
required the employer, Western, to provide Wronko with two [quit] and sue for damages if the employer persists
years’ salary if he was terminated. In 2002, the president of in treating the relationship as subject to the varied
Western approached Wronko with a new contract that re- term. This course of action would now be termed a
quired only 30 weeks’ pay to terminate the contract. Wronko “constructive dismissal” ….
refused to sign the new agreement. Western then gave Wronko Third, the employee may make it clear to the
two years’ notice that it would amend the notice of termination employer that he or she is rejecting the new term.
term in the contract from two years to 30 weeks. When the two The employer may respond to this rejection by
years were up, in 2004, Western sent Wronko the revised con- terminating the employee with proper notice and
tract with the 30 weeks’ notice term and told him if he did not offering re-employment on the new terms. If the
sign it, he no longer had a job. Wronko did not sign. He took employer does not take this course and permits
the position that he had been terminated, and he sued the the employee to continue to fulfill his or her job
employer for damages equal to two years’ wages as per the requirements, then the employee is entitled to
original 2000 contract. Western argued that it had the right to insist on adherence to the terms of the original
unilaterally modify a contract provided that it gave proper contract.
notice to Wronko and that Wronko had quit.
The situation in this case fell under the third option. How-
Issue: Was the employer within its rights to unilaterally change ever, the employer did not terminate the original contract and
the notice of termination clause provided it gave notice of the offer Wronko a new contract on different terms. Rather, it
change to Wronko? waited two years and then attempted to unilaterally impose
the modification on Wronko.
Decision: No. Wronko was terminated when he was told that Wronko was entitled to two years’ compensation, as per
there would be no job for him unless he signed an agreement the term of the original 2000 contract (minus moneys he re-
with the reduced notice of termination period. ceived from other employment during that two-year period,
The court summarized the three options available to an which is a result of a rule called mitigation that we will learn
employee when the employer attempts to unilaterally amend about in Chapter 14 in the discussion of damages for breach
an employment contract: of the employment contract).

a greement. Absent agreement by the employee, the employer who insists on the amendment
must provide the employee with the proper amount of notice required by the contract to ter-
minate the contract and inform the employee that once that notice period is over, employment
will only continue according to the modified contract terms.
Table 7.1 summarizes what we have learned in this chapter about modifications to employ-
ment contracts.
TABLE 7.1 The Modification of Employment Contracts

Scenario Action Required
1. The employment contract includes The employer and employee must comply with the specified rules
a clause describing the process for for contract modification.
contract modification.
2. The employment contract does not

include a clause describing the
process for contract modification.
a. Both employer and employee Both sides must receive new consideration as a result of the
agree to the modification. modification.
b. The employer and employee do The contract cannot be unilaterally modified by the employer. The
not both agree to the employer must provide the employee with the amount of notice
modification. required to properly terminate the contract and inform the
employee that, once the notice period is over, employment will only
continue if the employee agrees to the modified contract terms.
IV. Chapter Summary

In this chapter, we explored the requirements to create an employment contract: (1) the parties
must have the legal capacity to contract; (2) the parties must have the intention to create a legally
enforceable contract; and (3) the contract must comprise an offer, an acceptance of that offer,
and mutual consideration. The absence of any of these requirements can prevent a court from
enforcing an agreement between an employer and employee. We also learned how this require-
ment for mutual consideration applies to contract modifications. A modification to an employ-
ment contract that is not supported by “fresh” consideration flowing to both parties will most
likely not be enforced by a court, even if both parties agreed to the amendment.

1. Is an employment contract between an employer and an “infant” or a worker who is men-
tally impaired always unenforceable? Explain.
2. What is the difference between an “objective test” and a “subjective test”? How does this
distinction matter when the courts assess if there was an intention to create a legally
enforceable employment contract?
3. Explain the significance of offer, acceptance, and mutual consideration in employment law.
4. Must an employment contract be in writing to be enforceable?
5. If a contract includes a written term allowing the parties to modify the contract as long as
both parties agree to the modification in writing, must both parties receive new consider-
ation for the modification to be enforceable?
6. What is “forbearance” in contract law? Explain how forbearance can constitute fresh
consideration.

APPLYING THE LAW

County Beer began as a small micro-brewery with just a hand- She gives the new contract to the employees and asks them
ful of employees. The owners did not have a background in to sign. Some employees sign, but Mark and Ahmed refuse,
law or human resource management (HRM), and they did not saying they do not agree to the reduced notice of termination
require their employees to sign written employment contracts. requirement.
The company grew, and the owners decided it was time to hire a. Would an employee who signed the new written
an HRM professional. Amanda Willow was hired. Amanda real- contract have an argument later on that the notice
ized that employees did not have written contracts, and she of termination clause in that contract is unenforce-
remembered from her employment law class that this probable and that they should be entitled to a longer
ably meant that the employer would be required to give those period of “reasonable notice”?
employees “reasonable notice” of termination, which could be b. If Amanda wants to ensure that the change she
quite long. She decides to ask the employees to sign new wants to make is legal and enforceable, how would
written contracts that provide the employees with the same you recommend she deal with the employees Mark
wages and benefits they are getting now, but also permits the and Ahmed who have refused to sign the new writ-
employer to terminate the employee by providing the min- ten contract? Assume Mark and Ahmed were hired
imum amount of notice required by employment standards the same day five years earlier and that a court
legislation (which would be much less than “reasonable would find that “reasonable notice” to terminate
notice”). both of them is six months.

1. See, e.g., British Columbia Infants Act, RSBC 1996, c. 223, (Montreal: McGill-Queen’s University Press, 1980); and
s. 21. See discussion in M. Mahadeo, “Minor Matters: M. Levine, Children for Hire: The Perils of Child Labour in
Ensuring the Enforceability of Contracts with Minors in the United States (Westport, CT: Praeger, 2003).
the Entertainment Industry” (2015) 93:1 Can Bar Rev 277. 4. A contract involving a mentally impaired employee might
2. The roots of the exceptions are deep and begin with the also now be treated as an incident of unconscionable con-
concept that an “infant” contract for “necessaries” is tract if it is considered to be grossly unfair to the employee.
enforceable. In Doyle v. White City Stadium Ltd., [1935] See S.M. Waddams, The Law of Contracts, 4th ed (Aurora,
1 KB 110, the court described the rule as follows (at 131): ON: Canada Law Book, 1999) at 487-88; Hardman v. Falk,
“An infant may bind himself to pay for his necessary meat, 1955 CanLII 308 (BCCA); and Canadian Imperial Bank of
drink, apparel, and such other necessaries, and likewise for Commerce v. Milhomens, 2004 SKQB 168.
his good teaching or instruction, whereby he may profit 5. Dalrymple v. Dalrymple (1811), 2 Hag. Con. 54, quoted in
himself afterwards,” and to that has been added in the G. Chesire & C. Fifoot, The Law of Contracts, 7th ed
course of years contracts of service that are to an infant’s (Sydney: Butterworths, 1969) at 94.
benefit. Contracts for apprenticeships and employment
6. See Andrews v. Canada (Attorney General), 2019 NLSC 42
contracts have been found to fall within a branch of the
at paras 17-19.
rule, provided that the contracts are generally “for the
benefit” of the employee. Not all employment contracts 7. Pichette v. Lumac Holdings Ltd., 2011 CanLII 80536 (NB
meet this standard, as demonstrated in the case of Toronto LEB).
Marlboro Major Junior “A” Hockey Club v. Tonelli, 1979 8. An offer to enter into an employment contract can be made
CanLII 1969 (Ont. CA) discussed in Box 7.1. See also De conditional on a future event occurring; this is known as a
Francesco v. Barnum [1890] 45 Ch D 430; and Butterfield v. “condition precedent” in contract law. In that case, the
Sibbitt and Nipissing Electric Supply Company Ltd., [1950] acceptance of the offer does not become valid until the
OR 504 (Sup Ct J). condition precedent has been satisfied. For example, an
3. See J. Rinehart, The Tyranny of Work, 2nd ed (Toronto: offer of employment may be made conditional on approval
Harcourt Brace, 1987) at 39-40; Karl Marx famously by a board of directors: Bowen v. Canadian Tire Corp.
described conditions of work of children in British fac- (1991), 35 CCEL 113 (Ont. Gen Div).
tories of the 19th century in K. Marx, Capital, vol 1 (New 9. J. McCamus, The Law of Contracts (Toronto: Irwin, 2012)
York: Penguin, 1976) at 356; J. Parr, Labouring Children: at 226, 229.
British Immigrant Apprentices in Canada, 1869 – 1924 10. Chappell & Company v. Nestle Co. [1960] AC 87.

11. See the discussion of the enforceability of expressed con- fixed contract of more than one year is not governed by
tract variation clauses in G. England, Individual Employ- the statute if it “could be performed in less than one year.”
ment Law (Toronto: Irwin, 2008) at 41. See also the The implied right to terminate a contract with “reasonable
discussion in Long v. Delta Catalytic Industrial Services notice” makes most contracts potentially terminable
Inc., 1998 CanLII 18145 (Alta. QB). within a year.
12. Other cases in which a contract modification failed due to 14. Rosas v. Toca, 2018 BCCA 191.
lack of mutual consideration include Francis v. Canadian 15. Globex Foreign Exchange Corporation v. Kelcher, 2011
Imperial Bank of Commerce, 1994 CanLII 1578 (Ont. CA); ABCA 240. See also Techform Products Ltd. v. Wolda, 2001
Holland v. Hostopia Inc., 2015 ONCA 762; Globex Foreign CanLII 8604 (Ont. CA) at para 24; and McLean v. The
Exchange Corporation v. Kelcher, 2011 ABCA 240; Braiden Raywal Limited Partnership, 2011 ONSC 7330.
v. La-Z-Boy, 2008 ONCA 464; Hobbs v. TDI Canada Ltd.,
16. An early case recognizing that a forbearance to exercise
2004 CanLII 44783 (Ont. CA); McLean v. The Raywal
the right to dismiss an employee for some period of time
Limited Partnership, 2011 ONSC 7330; Fasullo v. Invest-
constitutes new consideration is Maguire v. Northland
ments Hardware Ltd., 2012 ONSC 2809; Singh v. Empire
Drug Co. Ltd., [1935] SCR 412. An employee can also give
Life Ins. Co., 2002 BCCA 452; Orlan Karigan & Associates
consideration in the form of a forbearance: Ciric v. Ray-
Ltd. v. Hoffman, 2001 CanLII 28293 (Ont. Sup Ct J); and
theon Canada Limited, 2008 BCCA 241 (employee’s
Kohler Canada Co. v. Porter, 2002 CanLII 49614 (Ont. Sup
promise not to quit until laid off in exchange for a promise
Ct J). Cases in which a modification was found to be sup-
to pay severance would constitute new consideration from
ported by consideration to the employee include Clarke v.
the employee).
Insight Components (Canada) Inc., 2008 ONCA 837; Tech-
form Products Ltd. v. Wolda, 2001 CanLII 8604 (Ont. CA); 17 Lancia v. Park Dentistry, 2018 ONSC 751. This case also
Maguire v. Northland Drug Co. Ltd., [1935] SCR 412; and involves an interesting application of the Wronko decision
Lancia v. Park Dentistry, 2018 ONSC 751. explained in Box 7.9.
13. However, a statute may require some types of contracts to 18. Hill v. Peter Gorman Ltd., 1957 CanLII 393 (Ont. CA) at
be in writing. For example, some fixed-term contracts of 132. See also Polard v. ARO Inc., 2016 BCSC 2277; Loyst v.
more than one year must be in writing by virtue of Statute Chatten’s Better Hearing Service, 2012 ONSC 1653; Russo v.
of Frauds legislation in effect in some Canadian provinces Kerr, 2010 ONSC 6053; Wronko v. Western Inventory
(e.g., Ontario Statute of Frauds, RSO 1990, c. S.19), or by Service Ltd., 2008 ONCA 327; Lin v. Ontario Teachers’
virtue of the original 17th-century British Statute of Frauds Pension Plan, 2016 ONCA 619; and Kafka v. Allstate Insur-
that applies under “received law.” See Campbell v. Business ance Company of Canada, 2012 ONSC 1035. See also
Fleets Limited, [1954] OR 87 (CA); Smith v. Mills, 1913 Lancia v. Park Dentistry, 2018 ONSC 751 (suggesting that
CanLII 147 (Sask. CA); and Lavallee v. Siksika Nation, it is sufficient for an employer to provide “reasonable
2011 ABQB 49. The scope of the Statute of Frauds has been notice” of the modification rather than notice of
read down by Canadian courts, which have ruled that a “termination”).


CHAPTER 8
Expressed Terms of
Employment Contracts
II. Interpreting “Ambiguous” Contract
• Explain how the parol evidence rule and the contra proferentem doctrine influence how Terms 114
judges interpret employment contracts. III. Sources of Employment Contract
• Identify the three principal sources of employment contract terms. Terms 115
• Understand how judges decide whether a restrictive covenant clause is legally enforceable. A. Restrictive Covenant Clauses 116
• Explain the difference between a fixed-term, a fixed-task, and an indefinite-term B. Termination of Contract
Clauses 118
employment contract and how they are terminated.
• Identify and explain important situations in which the courts have refused to enforce Questions and Issues for Discussion 125
contract terms relating to the termination of employment contracts. Exercise 126
• Explain the “unconscionability” and “changed substratum” doctrines of contract law and Appendix 127
how they apply to termination of employment contracts. Notes and References 129
• Explain how employment contracts can come to an end by agreement of the employee to
retire at a defined date, and how mandatory retirement clauses are now subject to the
prohibition on age discrimination found in human rights legislation.
I. Introduction
Once we have an offer, an acceptance, and mutual consideration, we have an employment con-
tract. The contract may be oral or written. Some contracts are complicated and lengthy, but
many are quite sparse, like the one reproduced at the end of this chapter. Professor Hugh Collins
of Oxford University has described the employment contract as “incomplete by design,” by
which he means that the contracts are often left deliberately vague to allow for flexibility to deal
with the many contingencies that could arise over the life of the relationship.1 This chapter
introduces the employment contact, focusing on the sources of contract terms and on some
common terms found in written employment contracts and the legal issues that can arise in
relation to them.
Employment contract terms arise from three sources, as depicted in Figure 8.1:
• Expressed contract terms can be written and signed off on by both parties to create a
written employment contract, or they can be agreed to orally. For example, if the em-
ployer offers to hire the employee at a rate of $20 per hour and the employee accepts that
offer, then $20 per hour is the expressed contract term that governs the rate of pay,
whether or not it is written down.
expressed contract terms: Terms of a contract that the parties have explicitly agreed to, either orally or in writing.
113

• Ancillary contract terms are found in secondary documents such as human resource
policy manuals, employee handbooks, company rules handbooks, and benefits hand-
books. These documents are physically separate from the employment contract, but rules
and terms found in them can sometimes form part of the employment contract. It is
important to understand when that happens.
• Implied contract terms are read into contracts by judges to deal with situations that have
arisen and that are not specifically dealt with in any expressed contract terms. Implied
contract terms fill voids in the expressed contract terms. They are important in the com-
mon law of employment because most employment contracts are so sparse. The history
and development of implied contract terms in employment law is fascinating for what it
tells us about judges’ perceptions of the employment relationship over time.
This chapter will explore legal and policy issues related to expressed contract terms. In Chap-
ter 9, we will consider ancillary and implied contract terms.
II. Interpreting “Ambiguous” Contract Terms

Let’s begin our discussion of employment contract terms by considering some important tools
that judges use as interpretative aids. Contract interpretation involves the search for the inten-
tion of the parties when they entered into the contract. Often that intention is clear from
expressed language used by the parties in a written contract. Therefore, a judge will always begin
the task of resolving employment contract disputes by reading the written contract, if one exists.
If the language provides a clear answer, then not much difficulty should arise. Thus, if an
employment contract includes a term providing that “the employee will be paid at a rate of $20
per hour worked,” then little dispute should exist about the hourly rate. The intention of the
parties on the question of the wage rate is unambiguous.
However, sometimes the terms of the written contract are not clear, and thus neither are the
parties’ intentions. Contract terms can be ambiguous, which means that they are capable of
multiple interpretations, all of which are possible. For example, while it might be clear that the
employee is to be paid $20 per hour, what the parties intended by the words “hour worked” in
the contract could give rise to disagreements. Consider a live-in nanny who both works and lives
at her employer’s home, caring for two small children. Occasionally, when the children are sleep-
ing, the parents (i.e., the employer) go out for the evening, knowing that the nanny is home in
case the children wake up or something happens. While the parents are out, the nanny some-
times goes to sleep. Is the nanny “working” while she is sleeping? The answer will turn on how
a judge interprets the words “$20 per hour worked.” Did the parties intend “worked” to include
hours when both children and nanny are asleep?
When a contract term is clear (unambiguous), a judge will not usually permit the employer
or employee to present evidence that attempts to show they thought they were agreeing to some-
thing different than what the language says. In such instances, the judge is applying a rule of
evidence known as the parol evidence rule.2 According to this rule, a judge must decide what
a contract means by looking only at the clear words of the contract (i.e., they must “stay within
ancillary contract terms: Terms found in secondary documents, such as human resource policy manuals or employee hand-
books, that have been incorporated into an employment contract by agreement of the employer and employee.
ambiguous contract term: A contract term capable of multiple interpretations.
parol evidence rule: A common law rule of evidence in which a judge is prohibited from hearing evidence that the parties
intended a meaning different than what is indicated in the clear language of the written contract.

Chapter 8 Expressed Terms of Employment Contracts 115
the four corners of the contract”).3 The assumption is that the parties intended what they clearly
wrote down. So if the contract states that the hourly rate is $20 per hour, a judge will not listen
to evidence from the employer that in fact the employee agreed verbally to $15 per hour. The
contract is clear and unambiguous.
FIGURE 8.1 Sources of Employment Contract Terms
ANCILLARY EXPRESSED IMPLIED

CONTRACT TERMS CONTRACT TERMS CONTRACT TERMS
Terms in ancillary Terms that are stated in Terms that are read into the
documents that may be writing or explicitly contract by judges to fill
incorporated into the agreed to orally voids in expressed
employment contract contract terms
CONTRACT
_________________
(see Chapter 9)
_________________
_________________
_________________
_________________
_________________
_________________
_________________
_________________
________
However, when a written contract term is ambiguous, a judge can hear evidence about what
the parties intended the contract language to mean. That evidence can include what the parties
said during negotiations of the contract term and how the contract term has been applied in the
past. Contract ambiguity creates an exception to the parol evidence rule. To deal with the chal-
lenge of interpreting ambiguous contract terms, judges have also applied the contra proferen-
tem doctrine. This doctrine provides that, where a contract term is ambiguous (capable of
multiple meanings), the court will apply the interpretation that is most favourable to the party
that did not write the contract.4 In employment law, this usually means that the court will apply
the interpretation that is most favourable to the employee, since it is the employer that almost
always writes the contract.5 We will see some examples of how these interpretive tools are used
by judges to resolve employment contract interpretation disputes as we continue our discussion
of the employment contract.
III. Sources of Employment Contract Terms

The range of possible contract terms is as large as the imagination of the parties. In the appendix
at the end of this chapter you will find a sample employment contract with some commonly seen
contra proferentem doctrine: A rule of contract interpretation in which a judge interprets an ambiguous contract term in
the manner most favourable to the party that did not draft the contract.

terms and a brief discussion of those terms. Disputes can, and often do, arise over the meaning
of written provisions or how those provisions should be applied to different factual situations.
We will encounter many expressed contract terms as we work our way through this text. For
now, we will highlight two of the most commonly litigated expressed contract terms: (1) re-
strictive covenant clauses and (2) termination of contract clauses.
A. Restrictive Covenant Clauses

Imagine that Christine is employed as a financial adviser by a large bank and has hundreds of
clients. One day she quits the bank and opens up her own financial advisory firm down the
street. She sends letters to all of her old clients from the bank to inform them of her move and
is pleased when 80 percent of them transfer their accounts from the bank to her new business.
Christine has done real business harm to her former employer. But has she done anything that
is legally wrong?
The answer depends on the language used in her former employment contract with the bank.
Some contracts include clauses known as restrictive covenants. Restrictive covenants impose
limitations on the actions of former employees. There are three main types:
1. A non-disclosure clause prohibits a former employee from disclosing information that

has proprietary value to the employer.
2. A non-solicitation clause prohibits a former employee from attempting to persuade the
employer’s customers to stop doing business with the employer and instead do business
with the employee.6
3. A non-competition clause prohibits a former employee from entering into a competing
business with the employer.
See Box 8.1 for examples of each of these clauses.

Sample Restrictive Covenant Clauses
• Non-disclosure clause: “Upon termination of this con- former client of the Employer for a period of one year
tract, the Employee shall not retain, remove from the after the termination of this contract.”
Employer’s property, or destroy any document or com- • Non-competition clause: “The Employee agrees not to
puter file containing confidential information, and establish a competing business or otherwise engage in
shall not at any time disclose to any person any confi- competition with the Employer within a 20-kilometre
dential information relating to the Employer.” radius of the Employer’s offices for a period of three
• Non-solicitation clause: “The Employee agrees not to years from the date of the termination of this contract.”
solicit business by any means from any existing or
Restrictive covenant clauses, particularly non-competition clauses, are controversial because

they put into tension two important and competing interests. On the one hand, there are im-
portant social and economic reasons why people ought to have the freedom to engage in what-
ever (non-criminal) commercial activities they wish. Christine needs to be able to support
herself, and if she is an excellent financial adviser, then the community of investors has an inter-
est in her being able to sell her services. On the other hand, employers may have legitimate
restrictive covenant: A contract term that restricts the right of a former employee to engage in certain competitive practices
against their former employer.

business interests that are threatened if their former employees are free to go off and engage in
activities that pose a direct threat to those interests. Should the bank not be able to bargain a
promise from Christine that she will refrain from competing against it for some period of time
after she no longer works for the bank?
The Supreme Court of Canada has summarized the tension like this:
[R]estrictive covenants give rise to a tension in the common law between the concept of freedom of
contract and public policy considerations against restraint of trade.7
Judges balance these competing interests by applying their common law right to void con-
tract terms that are contrary to public policy (public policy illegality).8 In exercising this discre-
tion, judges start with a presumption that restrictive covenant clauses are generally unenforceable
because they are restraints on the right to engage in commercial activities (“restraint of trade”).
Judges have expressed concern that, especially in the employment context, employees are vul-
nerable because there is an imbalance of power on the side of employers. Employees could be
subjected to an oppressive restriction on their ability to earn a livelihood by a restrictive
covenant written into the contract by the more powerful employer.9 However, not all restrictive
covenant terms are void. Judges have carved out exceptions to permit “reasonable” covenants.
This approach was summarized in an 1894 British House of Lords decision:
The public have an interest in every person’s carrying on his trade freely: so has the individual. All
interference with individual liberty of action in trading, and all restraints of trade themselves, if there
is nothing more, are contrary to public policy and therefore void. That is the general rule. But there
are exceptions …. It is sufficient justification … if the restriction is reasonable.10
In a leading decision from the 1978 case of Elsey v. J.G. Collins Insurance Agencies, the Su-
preme Court of Canada explained that a “reasonable”—and therefore lawful—restrictive
covenant is one that satisfies the following conditions:
1. the covenant protects a real “proprietary interest” worthy of protection, such as trade
secrets, confidential business information, or key business connections and customer
lists, and is not simply an attempt to restrict healthy competition;
2. the covenant is reasonable as to geographical and temporal (time) scope, consider-
ing the specific type of work and the interests involved;
3. the covenant is reasonably necessary to protect the legitimate interests of the (former)
employer, and no alternative measure that is less restrictive on the former employee
could protect the employer’s interests; and
4. the covenant is unambiguous, such that its scope is clear and understandable.11
Applying this test, the courts have been more accepting of non-solicitation and non-
disclosure clauses than of more sweeping non-competition clauses. If the employer’s business
interests could have been protected by one of the former terms, then the court is likely to strike
down as unreasonable a broader non-competition clause that effectively prohibits the former
employee from working in the same field.12 If a non-solicitation clause would not adequately
protect the employer’s legitimate interests, then a judge will enforce a non-competition clause
only if the restrictions are reasonable in terms of how wide a geographical scope the ban covers
and the length of the ban.
In assessing whether a geographical and temporal scope is “reasonable,” the courts consider
the type of work involved and what is reasonable to protect the employer’s legitimate business
public policy illegality: A common law right of judges to void all or part of a contract because it is contrary to public policy.

interests.13 Each case has to be assessed according to its own facts. The same geographical scope
and time limit may be reasonable in one circumstance and unreasonable in another. For ex-
ample, in the case of Lyons v. Multari discussed in Box 8.2, the court found that a non-
competition clause with a 5-mile radius and a three-year duration was reasonable for an oral
surgeon in Windsor, although the non-competition clause was still struck down as unreasonable
because a less intrusive non-solicitation clause would have sufficed to protect the employer’s
interest. However, in another decision, a two-year, 5-kilometre radius restriction applied to a
massage therapist in Winnipeg was ruled to be unreasonable in its geographical and temporal
scope.14

The Enforceability of Restrictive Covenant Clauses
Lyons v. Multari Decision: The restrictive covenant was void and unenforce-
2000 CanLII 16851 (Ont. CA) able. First, the court ruled that Lyons had a proprietary interest
worthy of protection in the form of the relationships he held
Key Facts: Lyons and Multari were surgeons. Lyons had worked with dentists who had regularly referred him patients over the
in Windsor for 25 years by the time he hired Multari to work years. Second, for a dental surgeon who is reliant on referrals
with him in the practice. They signed an employment contract from local dentists, a five-mile radius and three-year period are
that included a restrictive covenant clause prohibiting Multari not unreasonable. However, the non-competition clause failed
from working as a surgeon anywhere within five miles of Lyons’s to satisfy the third condition of a reasonable restrictive coven-
office for a period of three years after the end of their employ- ant. The court ruled that a less intrusive “non-solicitation”
ment contract. After 17 months Multari quit, and 6 months clause would have been sufficient to protect Lyons’s interests
afterward opened up a surgery practice within the five-mile in preserving his relationships with his regular referring
range. Lyons sued to enforce the restrictive covenant. dentists.
Issue: Was the restrictive covenant term enforceable or void
as contrary to public policy?
Finally, it is important to note that apart from its reasonableness, a restrictive covenant will
not be enforced if the employer terminates the employment contract without providing the em-
ployee with the notice the contract required (a wrongful dismissal, discussed in Chapter 10).
Since that employer repudiated the contract, it cannot then attempt to seek to enforce the re-
strictive covenant.15
B. Termination of Contract Clauses

As explored in upcoming chapters, the default rule in the common law regime is that the parties
must provide one another with “reasonable notice” when they terminate the employment con-
tract, and the courts decide how much notice is “reasonable” (see Chapters 9 and 10). However,
the parties can agree to waive this default requirement by including an expressed clause in the
employment contract that provides for termination of the contract without having to provide
“reasonable notice.”
repudiation of contract: A breach of contract that demonstrates an intention by the party to treat the contract as at an end
and to no longer be bound by the contract.


Sample Termination of Contract Clauses
• Fixed-term clause: “This contract commences on January time and for any reason by providing the employee
1, 2020, and terminates on December 31, 2020.” with three months’ notice, including benefits, which
• Fixed-task clause: “The employer agrees to employ the may be working notice or pay in lieu of work.”
employee to dismantle and safely remove the shelving • Mandatory retirement clause: “The parties agree that
at the three facilities owned by the employer identified the employee will retire and this contract comes to an
in Appendix A to this employment contract.” end on the employee’s 65th birthday, unless the con-
• Notice of termination clause in an indefinite-term contract is terminated by one of the parties prior to this
tract: “The employer may terminate this contract at any date.”
For example, the parties can agree that the contract only lasts for a fixed period of time (a
fixed-term contract16), or that the contract expires upon completion of a defined task
(a fixed-task contract), or they can expressly agree to the amount of notice that is required to
terminate the contract and thereby remove the courts’ discretion to imply “reasonable notice”
(a notice of termination clause17). The parties might also agree to a mandatory retirement
clause that terminates the contract upon the employee reaching a specified age (although these
clauses may now run afoul of modern-day human rights legislation). Box 8.3 provides examples
of each of these types of contract clauses.
By agreeing at the outset when or how the contract can be terminated, the parties hope to
avoid litigation later about whether, and how much, reasonable notice is required. However, they
are not always successful in avoiding disputes. A significant percentage of employment-related
lawsuits that reach the courts involve disputes over fixed-term and, especially, notice of termin-
ation clauses.18 Let’s consider some legal issues that can arise in relation to expressed contract
terms that apply to the termination of contracts.
1. Termination by Fixed-Term or Fixed-Task Clause

A contract for a fixed term or fixed task ends when the term or task is done, and nothing more
is required to bring about the termination. The contract simply ends by virtue of the agreement
of the parties to end it at that moment, and no notice of termination is required.19 Some prov-
inces have statutory restrictions on fixed-term contracts, but let’s leave those rather obscure
statutes aside.20 In the common law regime, the parties are assumed to be free to bargain a fixed-
term or fixed-task contract if they wish. Since the right to notice of termination that is required
in the case of indefinite-term contracts is forfeited in the case of fixed-term and fixed-task
contracts, the courts have demanded very clear evidence that both parties intended this result.21
If any uncertainty exists about whether both parties intended to create a fixed-term or fixed-task
contract and thereby to eliminate the requirement for notice of termination, judges will revert
to implied “reasonable notice.”22 The case discussed in Box 8.4 provides an example of this
approach.
fixed-term contract: A contract with a specific defined end date.

fixed-task contract: A contract to perform a defined task that comes to an end when the task is complete.
notice of termination clause: A clause in an employment contract that specifies how much notice is required to be given
to the other party in order to lawfully terminate the contract.
mandatory retirement: A legal rule in a statute or contract that terminates an employment contract upon the employee
reaching a specified age.
indefinite-term contract: A contract that has no specified end date.


Abuse of Fixed-Term Employment Contracts
Ceccol v. Ontario Gymnastic Federation Fixed-term contracts of employment are … legal. If
2001 CanLII 8589 (Ont. CA) their terms are clear, they will be enforced. … How-
ever, the consequences for an employee of finding
Key Facts: Ceccol worked for Ontario Gymnastic Federation that an employment contract is for a fixed term are
(OGF) for some 16 years pursuant to 15 one-year fixed-term serious: the protections … of the common law prin-
contracts. Each contract stated that the contract was for one ciple of reasonable notice do not apply when the
year, but was also subject to “renewal” or termination sooner fixed term expires. …
if the employee acted improperly. After the 15th contract, OGF It seems to me that a court should be particularly
informed Ceccol that the contract would not be further re- vigilant when an employee works for several years
newed, and Ceccol’s employment ended when that contract under a series of allegedly fixed-term contracts. Em-
expired. Ceccol sued for wrongful dismissal and sought dam- ployers should not be able to evade the traditional
ages arising from the failure of the employer to give her “rea- protections of … the common law by resorting to
sonable notice” of termination. the label of “fixed-term contract” when the under-
lying reality of the employment relationship is
Issue: Was the employment contract for an indefinite term
something quite different, namely, continuous ser-
(therefore requiring reasonable notice of termination) or a
vice by the employee for many years coupled with
one-year fixed term (in which case the contract just came to
verbal representations and conduct on the part of
an end at the specified end date)?
the employer that clearly signal an indefinite-term
Decision: The Ontario Court of Appeal ruled that the contract relationship. …
was ambiguous. Although one clause said the contract was for I conclude that the employment contract was for
a one-year period, other parts of the contract indicated that an indefinite term, subject to renewal and termina-
the contract could last more or less than that. Since the con- tion in accordance with other provisions in the
tract was ambiguous, the court was permitted to hear evi- contract.
dence about what the parties intended (the parol evidence rule,
explained earlier in this chapter). The witnesses’ testimony Ultimately, the court ruled that Ceccol should have received
indicated that when Ceccol was first hired, the intention and 16 months’ reasonable notice of termination, and therefore
understanding of the parties was that she was being employed ordered the employer to pay damages based on lost wages
on a full-time, permanent basis, and not for a one-year fixed for that amount of time (minus four months’ pay because Cec-
contract. The Ontario Court of Appeal concluded with the fol- col had not properly mitigated her loss; we discuss mitigation
lowing observations: in Chapter 14).
In Ceccol, the court ruled that the term clause was ambiguous and therefore relied on evi-
dence of what the parties intended to happen to find that the contract was really one of indefinite
term. In the case of Alguire v. Cash Canada Group Ltd., the Alberta Court of Appeal found that
a term clause reading that the contract “is to run from February 1, 2002, to January 31, 2003”
demonstrated an “unequivocal and explicit” intent to form a fixed-term contract, even though
it was the last of several such one-year contracts.23 Thus, the lesson from Ceccol is not that the
courts will always treat a series of short-term contracts as a single, indefinite-term contract
requiring reasonable notice of termination, but that, depending on the facts of the case, they
may do so.
If either party terminates a fixed-term contract before the agreed-upon end date, that party
will be in breach of the contract unless the contract expressly permits an early termination.
Damages will then be assessed based on the loss the other party incurs as a result of being
deprived of the right to perform the remainder of the contract, which is usually equal to lost
wages and benefits for the remaining period.24 This scenario is considered in Box 8.5.


Early Termination of a Fixed-Term Contract
Howard v. Benson Group Inc. Decision: Yes. The Ontario Court of Appeal noted that it is
2016 ONCA 256 well-settled law that an employer that terminates a fixed-term
contract early is liable for damages based on the remaining
Key Facts: The parties entered into a fixed-term employment period of the contract, unless the contract allows for early
contract for five years commencing in September 2012. How- termination. Clause 8.1 of the contract was found to be am-
ard was terminated without cause after only 23 months. Clause biguous, and therefore the court applied the contra proferen-
8.1 of the contract stated that the employer could terminate tem doctrine explained earlier in this chapter, ruling that the
the contract early, in which case “any amounts paid to the interpretation most favourable to Howard would be applied.
employee shall be in accordance with the Employment Stan- Clause 8.1 is not clear whether notice is limited to the ESA
dards Act [ESA].” The employer gave Howard two weeks’ notice, amount, or whether it simply states that whatever notice is
which was the minimum amount of notice required by the given will be at least equal to the ESA amount. Since the
ESA. Howard sued the employer and argued that he was en- contract did not include a clear term permitting the employer
titled to damages based on lost wages for the remaining per- to terminate the contract early, the employer was liable for
iod of the fixed-term contract (37 months). damages based on lost wages and benefits for a period of 37
Issue: Is the employer required to pay Howard the equivalent months, equal to the remaining period of the five-year
of his lost wages for the remainder of the five-year fixed-term contract.
contract?
Finally, note that if an employee remains employed beyond the end of a fixed term, the con-
tract becomes one of indefinite term and is subject to the implied obligation to provide reason-
able notice of termination.25
2. Termination According to a Contractual Notice Clause (and Potential

Pitfalls)
Many indefinite-term contracts include notice of termination clauses, such as the one repro-
duced in Box 8.3. Employers often include the clauses because they want to override the com-
mon law implied obligation to provide “reasonable notice” of termination, which is unpredictable
and potentially lengthy (see Chapter 10 to learn how courts determined reasonable notice). As
with fixed-term and fixed-task contracts, courts require notice of termination clauses to be
crystal clear in demonstrating the intention of the parties to replace “reasonable notice” with
something else.26 Any ambiguity will result in the court preserving implied “reasonable notice,”
but, assuming that the language is clear, a written notice of termination clause would normally
replace the implied term requiring reasonable notice. However, a number of legal issues can
arise that lead the courts to decline to enforce expressed notice of termination clauses. Three are
briefly considered here:
a. When the notice of termination clause violates statutory notice provisions.

b. When the notice of termination clause is “unconscionable.”
c. When changes to the employee’s job have rendered the original notice of termination
clause unenforceable so that the “changed substratum doctrine” applies.
a. When the Notice of Termination Clause Violates Statutory Notice Provisions
We saw in the case considered in Box 8.5 that employment standards legislation in Canada regu-
lates the termination of employment contracts alongside the common law rules of contract. In

particular, employment standards statutes establish a minimum amount of notice of termination

that employers must provide employees. Table 20.1 in Chapter 20 provides a quick look at notice
requirements in Canadian employment standards legislation, which we will consider in Part III
of the book. For now, it is sufficient to know that a contract term that contravenes an employ-
ment standards requirement is unlawful.
What happens if the notice of termination clause in a contract permits the employer to ter-
minate the contract with less notice to the employee than required by employment standards
legislation? For example, what if an employment contract entitles an employer to terminate the
contract by providing the employee with four weeks’ notice when the applicable employment
standards legislation requires that at least six weeks’ notice be given to that employee? The Su-
preme Court of Canada was confronted with this scenario in the case discussed in Box 8.6.

Illegal Notice of Termination Clauses
Machtinger v. HOJ Industries Ltd. With that purpose in mind, the court indicated that the
[1992] 1 SCR 986 proper interpretation is to require reasonable notice when
contract terms violate the ESA, for the following reason:
Key Facts: The employment contract between Machtinger and
his employer, HOJ Industries, permitted HOJ to dismiss Macht- If the only sanction which employers potentially
inger without notice. That term violated the Ontario Employ- face for failure to comply with the [ESA] minimum
ment Standards Act (ESA), which required that Machtinger notice periods prescribed by the Act is an order that
receive at least four weeks’ notice of termination. In fact, HOJ they minimally comply with the Act, employers will
recognized the error and paid Machtinger four weeks’ pay in have little incentive to make contracts with their
lieu of notice and thereby complied with the ESA. However, employees that comply with the Act. As Swinton and
Machtinger sued for wrongful dismissal, arguing that he was Etherington suggest, most individual employees are
entitled to a much longer period of implied “reasonable unaware of their legal rights, or unwilling or unable
notice.” to go to the trouble and expense of having them
Issue: Does the ESA minimum notice period or the implied vindicated. Employers can rely on the fact that many
reasonable notice period apply when a contract term allows employees will not challenge contractual notice
less notice of termination than required by the ESA? provisions which are in fact contrary to employment
standards legislation. Employers such as the present
Decision: The Supreme Court of Canada ruled that the illegal respondent can contract with their employees for
clause was void and is replaced by the implied term requiring notice periods below the statutory minimum, know-
reasonable notice of termination. The court explained that the ing that only those individual employees who take
implied obligation to provide reasonable notice is a “rebutta- legal action after they are dismissed will in fact re-
ble presumption,” meaning that it applies unless the written ceive the protection of the minimum statutory no-
contract includes clear language that some other period of tice provisions.
notice applies. Such a clause existed here, but it was contrary
to the ESA, rendering it legally void. In deciding how the law Therefore, the court ruled that a contract clause that vio-
should deal with this situation, the court emphasized “policy lates employment standards minimum notice requirements
considerations.” It set out the considerations noted in Box 7.7, will be replaced by the common law presumption of reason-
which emphasize the vulnerability of employees. It then de- able notice. In this case, applying the Bardal factors we will
scribed the ESA as a “remedial statute,” the purpose of which discuss in Chapter 10, the amount of reasonable notice was
is to extend protections to as many employees as possible. set at seven months.
In the passage from Machtinger cited in Box 8.6, the Supreme Court of Canada acknowledged
that employers usually write employment contracts and that most employees agree to them
“unaware of their legal rights.” This is an important admission by the court, one that has influ-
enced modern interpretations of employment contracts. Although the common law is still

premised on the notion of “freedom of contract,” the court also acknowledges that employees
often lack information about what they are agreeing to.27 And since most employees lack the
power to negotiate up from the terms in the employer’s opening offer and the financial resources
to hire lawyers to enforce the contract, they are vulnerable. These insights contributed to the
court’s decision to choose the interpretive option that afforded the greatest level of protection
for the employee.
A few final points need to be made about notice of termination clauses that conflict with
employment standards legislation flowing from the Machtinger decision. First, notice of termin-
ation clauses can run afoul of employment standards laws even if the employer ultimately com-
plies with the statute. In the Machtinger case, the employer gave the employee four weeks’ notice
as required by the employment standards legislation, but that did not matter because the con-
tract language itself allowed the employer to terminate the contract with no notice.28 The em-
ployer cannot “cure” an illegal clause by giving the employee more than the clause requires.
Second, a notice of termination that could at some point in the future permit the employer to
terminate the employee in a manner that would violate employment standards legislation is
unlawful, even if at the time the employee is terminated the employer complied with the legis-
lation. For example, if the contract permits the employer to terminate the employee with two
weeks’ notice, and at the time of the termination the employee is only entitled to two weeks’
notice under the employment standards legislation, then the employer would not be violating
the legislation or the contract by providing two weeks’ notice. However, because employment
standards’ notice increases over time in some jurisdictions (see Table 20.1), once the employee
is employed longer than, say, five years, the contract term permitting termination with two
weeks’ notice may become illegal; the legislation may require five weeks’ notice. Since the
enforceability of the notice of termination clause is assessed as of the date the contract is
formed, the term permitting termination with two weeks’ notice would be deemed
unenforceable.29
Third, the notice of termination clause must not offend the employment standards legislation
in any manner. Employment standards laws require not just that employers provide notice to
the employee of a specified amount, but also that the employer continue to provide any benefits
coverage that the employee was entitled to throughout that notice period. Therefore, an employ-
ment contract clause that requires that the employer provide the amount of notice required by
the employment standards legislation and nothing else would violate the legislation and be ren-
dered void as well.30
Finally, although we will discuss the law of damages more fully in Chapter 14, it is useful to
flag that the inclusion in a contract of a notice of termination clause can have important implica-
tions for the rules involving the duty to mitigate damages. As we will learn, employees are
required to “mitigate” the damages caused by an employer’s breach of the contract. In the case
of a breach of the implied duty to give reasonable notice of termination, this means they need
to take all reasonable steps to find another job. Income earned from their new job can then be
deducted from the amount of damages their former employer would otherwise be required to
pay. However, if the contract includes an expressed notice of termination clause, the duty to
mitigate may not apply.31 We will return to this point when we look at damages.
b. When the Notice of Termination Clause Is “Unconscionable”

Judges can refuse to enforce a contract term they believe is grossly unfair, or “unconscionable.”32
However, since ignoring the agreement of the parties runs so contrary to the concept of freedom
duty to mitigate: A legal obligation on the victim of a breach of contract by the other party to make reasonable efforts to
limit the amount of damages suffered as a consequence of the breach.

of contract, judges have been cautious in applying the unconscionability doctrine. For a term
of a contract to be set aside as unconscionable, all of the following elements must be present:
1. A grossly unfair transaction;

2. A lack of independent legal advice or other suitable advice;
3. An overwhelming imbalance in bargaining power caused by the victim’s ignorance of
business, illiteracy, ignorance of the language of the bargain, blindness, deafness, illness,
senility, or similar disability; and
4. The other party knowingly taking advantage of this vulnerability.33
In the case of Stephenson v. Hilti (Canada) Ltd., a dismissed employee agreed to accept three
months’ pay when reasonable notice would have been between 10 and 12 months.34 The em-
ployee sued, seeking damages for the failure of the employer to provide the longer period of
reasonable notice, arguing that his agreement to accept three months’ pay was unenforceable
due to unconscionability. The court agreed. It ruled that the employee was suffering from
depression at the time he agreed to three months’ pay, and that he believed if he did not accept
the deal he would incur dire financial repercussions. The three-month payment was substan-
tially below what a court would find to be reasonable notice. However, the employer paid little
attention to this point, or to the well-being of the employee, and instead based its offer on a
substandard period of notice to benefit its own economic interests. This approach diverged from
community standards of commercial morality. The court set aside the three-month period and
assessed damages based on a period of 11 months’ notice.
c. When the “Changed Substratum Doctrine” Applies

Finally, if an employee’s job functions have changed substantially since the date they origin-
ally agreed to a notice of termination clause, a court may refuse to enforce the original notice
term. This refusal involves the application of what is known as the changed substratum
doctrine. Imagine that Amanda was hired as a McDonald’s cashier in 1990 and signed a
standard form one-page contract saying that the employer can dismiss her at any time by
giving her the minimum amount of notice required by employment standards laws. Amanda
is a fantastic worker and, over time, is promoted up the ranks. When she is ultimately fired
in 2015, she is McDonald’s regional manager for eastern Canada, responsible for hundreds of
stores, but the employer provides her with just eight weeks’ notice, as required by the employ-
ment standards laws. When an employee has been assigned much greater job responsibility
over time, and the original contract does not contemplate this outcome, the court might rule
that the “substratum” of the original employment contract has disappeared. In that case, the
notice term in that contract is unenforceable, and reasonable notice is implied in its place.35
3. Termination by a Retirement Clause

The mandatory retirement clause reproduced in Box 8.3 does not prevent the contract from
being terminated earlier for cause or with notice, but if the contract is still in effect on the
employee’s 65th birthday, it comes to an end by virtue of this clause. A mandatory retirement
unconscionability doctrine: A contract or contract term that a court refuses to enforce because it is a result of inequality
of bargaining power that was exploited by the more powerful party to obtain a contract that is substantially unfair considering
community standards of commercial morality.
changed substratum doctrine: A legal doctrine in employment law in which an employee’s job responsibilities have changed
so substantially from the time the original contract was executed that the courts rule the original “substratum” of the contract
has ceased to exist. In this case, the court may refuse to enforce a contract them in the original contract.

clause reflects the agreement of the parties that the contract will end upon the happening of a
future, predictable event—the employee turning 65.
Mandatory retirement clauses used to be common in Canada. For some workers, retirement
is something to look forward to. For many others, retirement is a scary prospect full of uncer-
tainty and financial instability, if not outright poverty. These workers would prefer to keep work-
ing, either because they lack sufficient retirement savings or because they value the personal
fulfillment and social interaction that working provides. The average year in which Canadians
retire has risen over the years: in 1998, it was approximately 60.9 years of age, while in 2018 the
average age of retirement was 63.8.36 A recent poll found that about 30 percent of Canadians
aged 18 to 34 have no retirement savings at all.37 People are working longer and having a harder
time preparing for life after work.
Concern about elder poverty and work-based discrimination based on age has led govern-
ments to legislate retirement in a number of ways, including mandatory deductions to the
Canada Pension Plan and prohibitions against discrimination based on age in human rights
legislation. Beginning in the early 2000s, Canadian governments began to abolish mandatory
retirement by amending human rights legislation to make forced retirement clauses unlawful
age discrimination. As a result of this change within the regulatory regime, mandatory retire-
ment clauses in employment contracts are in most cases now unlawful in Canada, with some
exceptions. For example, mandatory retirement may be permitted when retirement at a specific
age is a requirement of a “bona fide” pension plan scheme (see Chapter 23).38 Other than when
these narrow exceptions apply, it is now illegal in Canada for an employment contract to be ter-
minated based purely on the employee reaching a specific age.
IV. Chapter Summary

This chapter examined employment contract terms. It opened with a quick overview of inter-
pretive devices used by judges to resolve complex contract disputes. There are three principal
sources of contract terms: (1) expressed contract terms, (2) ancillary contract terms, and (3)
implied contract terms. This chapter examined the first of these. It would be impossible to dis-
cuss every possible term that could appear in an employment contract, so we have focused on
key expressed contract terms that produce the most litigation: (1) restrictive covenant clauses
and (2) contract clauses that define how and when employment contracts terminate. In Chapters
10 to 15, we return to the topic of termination of contracts when we explore termination with
reasonable notice, summary dismissal, constructive dismissal, and resignations.

1. Describe two legal tools used by judges to help them interpret an ambiguous contract term.
2. Identify and describe three types of restrictive covenant terms. What are the conditions in
which a court will rule that a restrictive covenant is lawful?
3. Why do judges often not enforce restrictive covenant clauses in employment contracts?
4. If an employment contract term specifies that the contract operates from January 1, 2020,
to December 31, 2020, must the employer provide notice of termination to terminate the
contract?
5. On what basis did the court refuse to enforce the fixed-term contract clause in Ceccol v.
Ontario Gymnastic Federation (Box 8.4)?
6. Explain the tests applied by the courts when considering the following two arguments for
non-enforceability of a notice of termination clause: (1) unconscionable contract term and
(2) the changed substratum doctrine.
7. How do the courts in the common law regime deal with an employment contract term that
permits termination of the contract by provision of less notice than required by employ-
ment standards legislation?

APPLYING THE LAW

1. Last year, County Beer Company hired Bridget Dort- sonable notice” can be very lengthy. Taylor drafts up
man as a beer maker after she graduated from college the following three contract terms. Drawing on the
with a diploma in Brewing Sciences. As a beer maker, materials in this chapter that consider notice of ter-
Bridget learned the formula and process used to make mination clauses, explain whether the terms would
the popular County Beer Ale. One day, Amanda Wel- likely achieve the result desired by the employer if an
lington, the new human resources manager, noticed employee later sued the employer and argued that
when going through personnel files that there was no they are entitled to “reasonable notice”:
signed employment contract for Bridget. She asked
the owners about this, and they told her they must A. The employer can terminate this contract at any
have forgotten to get Bridget to sign. So Amanda pre- time by providing the employee with two weeks’
pared a standard employment contract and presented notice, which can be working notice or pay in lieu
it to Bridget to sign. Bridget read the contract and no- of notice.
ticed a non-competition clause (Article 8), which stat- B. The employer can terminate this contract at any
ed that Bridget could not work for another beer time by providing the employee with the amount
company in the province for a year after her employ- of notice required by employment standards legis-
ment ended with County Beer. Bridget thought that lation. The employer shall not be obliged to make
was unfair, but because Amanda told her that all any other payments to the employee.
employees must have a signed contract, she signed C. The employer can terminate this contract at any
the contract. Two years later, Bridget quit County time by providing the employee with the full en-
Beer and accepted a job as a beer maker at Northern titlements to which the employee is entitled under
Brewery, a small micro-brewery located in the north employment standards legislation.
of the province, nearly 500 kilometres from County
Beer. 3. Assume that Taylor opts for clause B in the preceding
Assume that County Beer launches a lawsuit against question. Later on, she terminates an employee who
Bridget for breaching the non-competition clause in had five years’ service and had signed a contract that
the employment contract and that Bridget comes to included that clause. By that point, Taylor realizes that
you for legal advice. What would you argue on behalf the two weeks’ notice in clause B is less than the five
of Bridgett in her defence? weeks required by employment standards legislation
in her province to terminate an employee with five
2. Taylor is the human resources manager at a medium- years’ service. Therefore, Taylor provides the employee
sized retail company. Her boss tells her to prepare a with five weeks’ notice rather than the two weeks out-
standard form employment contract that will ensure lined in the contract. However, the employee never-
the employer is not required to give employees “rea- theless sues the employer seeking a much longer
sonable notice” if the employer decides to terminate period of “reasonable notice.” Do you think the em-
the contract, because the boss has learned that “rea- ployee will succeed?
EXERCISE
Dozens of cases examine whether a restrictive covenant clause in an employment contract is
“reasonable,” applying the tests discussed in this chapter. Try the following legal research
exercise:

2. Choose a jurisdiction (province) or, by default, search all of Canada. In the “Document
text” search box, type “employment contract” and “restrictive covenant” and “reasonable.”
3. Choose one or two of the cases that result from this search and answer the following
questions:
a. What type(s) of restrictive covenant clauses were at issue in the case? What does the
covenant restrict the employee from doing?
b. Does the judge refer to the vulnerability of the employee?

c. Does the court rule that the covenant is reasonable or unreasonable?

d. Briefly explain how the court came to its conclusion.
If you read enough of these cases, you can begin to get a clearer idea of how judges are likely
to interpret a restrictive covenant clause.
APPENDIX
Sample Employment Contract

Note the careful use of the words
“consideration” and “valuable
consideration.” (See the discussion
of consideration in Chapter 7.)
This clause refers specifically to an THIS AGREEMENT made as of the 15th of August 2020, between County Beer
Company (the Employer) and Jane Smith (the Employee).
“Employee Handbook” and clearly
states that the handbook is part of WHEREAS the Employer desires to obtain the benefit of the services of the Employee
the contract. as a Beer Maker, and the Employee wishes to be employed as a Beer Maker.
This clause also gives the employer IN CONSIDERATION of the promises and other good and valuable consideration (the
the right to modify the Employee sufficiency and receipt of which are hereby acknowledged) the parties agree as follows:
Handbook and the employee’s job
1. Employment and Modifications
duties (see Chapter 7) without
The Employee agrees that she will at all times faithfully, industriously, and to the best of her
triggering a constructive dismissal
skill, ability, experience and talents perform all of the duties required of her position. In carrying
(see Chapter 13). out these duties and responsibilities, the Employee shall comply with the Employee Handbook,
which has been provided to the Employee prior to the execution of this contract and forms part
of this employment contract. The Employee agrees and understands that the Employer may
Even absent this sentence, the modify the terms of that Handbook from time to time and that such modification is within
employee would have an implied the Employer’s contractual rights. It is also understood and agreed to by the Employee that her
obligation to perform competently assignment, duties and responsibilities and reporting arrangements may be changed by the
and faithfully (see Chapter 9). Employer in its sole discretion without amounting to a breach of this contract or a constructive
dismissal.
This clause must be compliant 2. Compensation

with any vacation entitlements in (a) As full compensation for all services provided, the Employee shall be paid at an annual
rate of $40,000. This amount shall be paid out to the Employee proportionally on a bi-
applicable employment standards monthly basis by means of direct deposit to the Employee’s personal bank account. Such
legislation (the same is true for the payments shall be subject to normal statutory deductions by the Employer.
wage rate stated in the
(b) The salary mentioned in paragraph (2)(a) shall be reviewed on an annual basis. Any future
Compensation clause). These increases to this pay rate are within the sole discretion of the Employer.
employment standards laws are
considered in Part III of this text. 3. Vacation
The Employee shall be entitled to vacations in the amount of two weeks per annum.
This clause does not indicate any 4. Benefits

specific level or content of benefits. The Employer shall at its expense provide the Employee with coverage under the Health Plan
It says simply that insofar as the that is currently in place or as may be in place from time to time. The Employer may, at its sole
employer continues to purchase discretion, amend or cancel the Health Plan or any benefits provided by it without breaching this
a Health Plan for its employees, contract.
Jane Smith (the employee) shall
5. Probation Period
be covered by it.
It is understood and agreed that the first ninety (90) days of employment shall constitute a
probationary period during which period the Employer may, in its absolute discretion, terminate
This clause overrides the implied the Employee’s employment, for any reason without notice or cause.
duty to provide reasonable notice
of termination to short-term
“probationary employees.” It is
subject to any notice of termination
requirements in applicable
employment standards legislation.

In some jurisdictions, employment

standards legislation does not
require employees to give notice of
termination (as we will see in Part III).
Provided this term does not conflict
with employment standards
requirements, it would supplant the
implied duty for the employee to
provide reasonable notice of
termination (see Chapter 15). In
practice, few employers go to court
to enforce this term because the 6. Performance Reviews
damages they suffer from an The Employee will be provided with a written performance appraisal at least once per year, and
employee quitting without notice said appraisal will be reviewed at which time all aspects of the assessment can be fully discussed.
are usually low (see Chapter 15).
7. Termination
(a) The Employer may at any time terminate this agreement and her employment by giving
This “summary dismissal” term
two weeks’ written notice to the Employer.
permits termination of an employee
(b) The Employer may terminate this agreement and the employment of the Employee at any
contract without notice for cause.
time, without notice or payment in lieu of notice, for sufficient cause.
The courts are often asked to
(c) The Employer may terminate the employment of the Employee at any time by providing
interpret these types of “cause” the Employee with written notice equivalent to the length of period required by applicable
terms. (See Chapter 12 for what employment standards legislation along with any statutorily required benefits.
constitutes “cause.”)
8. Independent Legal Advice
By specifying an amount of notice The Employee acknowledges that the Employer has provided the Employee with a reasonable
—the amount required by opportunity to obtain independent legal advice with respect to this agreement, and that either:
employment standards legislation— (a) the Employee has had such independent legal advice prior to executing this agreement, or
this term attempts to oust the (b) the Employee has willingly chosen not to obtain such advice and to execute this
common law implied contract term agreement without having obtained such advice.
requiring “reasonable notice” of 9. Restrictive Covenant
termination, which would usually The Employee shall not work for another beer company within 100 kilometres for a period of one (1)
be much longer than the year after this contract is terminated by either party. The Employee shall not disclose at any time
employment standards amount during or after this employment contract terminates any confidential information obtained during
(see Chapter 10). employment with the Employer, including brewing formulas or ingredients.
10. Entire Agreement

The purpose of this clause is to
This agreement contains the entire agreement between the parties, superseding in all respects any
demonstrate to a court that no
and all prior oral or written agreements or understandings pertaining to the employment of the
undue duress was placed on the Employee by the Employer.
employee at the time of signing and
that the contract was based on
informed consent. Name of Employee
This restrictive covenant clause

Signature of Employee Date
includes both a non-disclosure
and a non-competition component.
The non-competition component Name of Employer Representative/Title
could probably be challenged
successfully by the employee as
Signature of Employer Representative Date
“unreasonable” if the employer later
attempted to enforce it on the basis
that a 100-kilometre restriction for
a beer maker is probably overbroad.
This clause is intended to avoid

allegations of “negligent
misrepresentation” arising from
representation comments made by
one of the parties prior to the
execution of the contract
(see Chapter 6).
Sample for educational purposes only. Not intended to serve as a template.


1. H. Collins, The Employment Contract, 2nd ed (Oxford: 8. See the discussion of public policy contract illegalities in
Oxford University Press, 2010) at 10. R.A. Buckley, Illegality and Public Policy (London: Sweet &
2. P. Perell, “The Ambiguity Exception to the Parol Evidence Maxwell, 2002); J. McCamus, The Law of Contracts, 2nd ed
Rule” (2001) 36 Can Bus LJ 21; G.H.L. Fridman, The Law (Toronto: Irwin Law, 2012) at chapter 12; S. Bhalloo &
of Contract in Canada, 4th ed (Toronto: Carswell, 1999) at A. Parma, “Restrictive Covenants: When the Honey-
480. However, see the discussion in Sattva Capital Corp. v. moon Ends” (2016) 53 Alta L Rev 643, online: <http://
Creston Moly Corp., 2014 SCC 53, clarifying that the “parol www.canlii.org/t/6sb>; and O. Lobel, Talent Wants to Be
evidence rule” does not exclude evidence of “surrounding Free: Why We Should Learn to Love Leaks, Raids, and Free
circumstances” known to the parties or that ought to have Riding (New Haven: Yale University Press, 2013).
been known to the parties when the contract was formed 9. See the comments of the Supreme Court of Canada in
as an aid to interpreting contracts. It is too soon to know Shafron v. KRG Insurance Brokers, supra note 7 at para 22;
how, if at all, this decision will change the way the courts and Elsley v. J.G. Collins supra note 6 at 924: “A different
deal with the interpretation of employment contracts. situation, at least in theory, obtains in the negotiation of a
3. For a good discussion of the “parol evidence rule” in the contract of employment where an imbalance of bargaining
employment context and the many exceptions to the rule power may lead to oppression and a denial of the right of
that have been developed by courts, see King v. Operating the employee to exploit, following termination of employ-
Engineers Training, 2011 MBCA 80. ment, in the public interest and in his own interest, know-
ledge and skills obtained during employment.” See also
4. See Johnson v. Top-Co LP, 2009 ABQB 731; Ceccol
IRIS The Visual Group Western Canada Inc. v. Park, 2017
v. Ontario Gymnastic Federation, 2001 CanLII 8589 (Ont.
BCCA 301.
CA); Oudin v. Le Centre Francophone de Toronto, 2015
ONSC 6494; Movati Athletic (Group) Inc. v. Bergeron, 10. Nordenfelt v. Maxim Nordenfelt Guns & Ammunition,
2018 ONSC 7258; and Stefanec v. Robert Half Canada Inc., [1894] AC 535 (HL), cited with approval more recently by
2000 BCSC 1224 (notice of termination clause in contract the Ontario Court of Appeal in Lyons v. Multari, 2000
is ambiguous, so court applies interpretation most favour- CanLII 16851 (Ont. CA).
able to employee). The doctrine is not applied if the em- 11. Elsley v. J.G. Collins, supra note 6. The fourth factor was
ployee played a meaningful role in the negotiation of the discussed explicitly in the more recent decision Shafron v.
contract; it is reserved for ambiguous clauses in contracts KRG Insurance Brokers, supra note 7, where the Supreme
drafted solely, or at least primarily, by the employer. See Court of Canada ruled that a restrictive covenant that is
also McClelland & Stewart Ltd. v. Mutual Life, [1981] 2 ambiguous will not be considered reasonable. In that case,
SCR 6; and Gill v. Navigate Capital Corp., 2014 BCCA 462 the ambiguous term restricted competition in the “Metro-
(the contra proferentum doctrine does not apply to oust a politan City of Vancouver.” See also on this point Globex
well-known standard implied term in employment Foreign Exchange Corporation v. Kelcher, 2011 ABCA 240;
contracts). and Rhebergen v. Creston Veterinary Clinic Ltd., 2014
5. See, e.g., Greenberg v. Meffert, 1985 CanLII 1975 (Ont. BCCA 97 (clause requiring a former employee to pay a
CA); but see Foreman v. 818329 Ontario Limited, 2003 large fee if they set up a competing business within three
CanLII 57401 (Ont. CA) (ambiguity is interpreted against years was ruled an unreasonable restraint of trade on the
an employee who had drafted the contract). basis of ambiguity).
6. For discussion of how courts treat non-solicitation clauses, 12. H.L. Staebler Company v. Allan, 2008 ONCA 576; Mason v.
see Elsley v. J.G. Collins Ins. Agencies, [1978] 2 SCR 916; Chem-Trend Limited Partnership, 2011 ONCA 344; Thienes
and MD Physician Services Inc. v. Wisniewski, 2018 ONCA v. Godenir, 2011 SKQB 271; Phoenix Restorations Ltd. v.
440. Non-solicitation clauses are interpreted narrowly: Brownlee, 2010 BCSC 1749; Edward Jones v. Mirminachi,
Veolia ES Industrial Services Inc. v. Brulé, 2012 ONCA 173 2011 BCSC 295; Lyons v. Multari, supra note 10; Westpac
(bidding on a public tender is not solicitation); IBM Solutions Ltd. v. Morgan, 2018 BCSC 976; Telus Communi-
Canada Ltd. v. Almond, 2015 ABQB 336; IT/Net Inc. v. cations Inc. v. Golberg, 2018 BCSC 1825; Ceridian Dayforce
Doucette, 2007 ONCA 52 (accepting a work offer from Corporation v. Daniel Wright, 2017 ONSC 6763; Kohler
former client is not solicitation); Planet Paper Box Group Canada v. Porter, 2002 CanLII 49614 (Ont. Sup Ct J).
Inc. v. McEwan, 2018 ONSC 6991. 13. See Kohler Canada v. Porter, supra note 12. (non-competi-
7. Shafron v. KRG Insurance Brokers (Western), 2009 SCC 6 at tion clause covering all of North America is unreasonable);
para 16. See also EMW Industrial Ltd. v. Good, 2019 SKQB MacMillan Tucker MacKay v. Pyper, 2009 BCSC 694 (pro-
47; Knight Archer Insurance Ltd. v. Dressler, 2019 SKCA 24; hibition on lawyer from working within 5 miles of old law
and Barton Insurance Brokers Ltd. v. Irwin, 1999 BCCA 73. firm for three years is unreasonable); and Donaldson

Travel Inc. v. Murphy, 2016 ONCA 649 (no time limit at all 21. Dwyer v. Mark II Innovations Ltd., 2006 CanLII 9406 (Ont.
is unreasonable). CA); Foreman v. 818329 Ontario Limited, supra note 5;
14. Steinke o/a Muscle Mechanics Massage Therapy v. Barrett, Gibson v. Alberta, 2013 ABQB 695; Ceccol v. Ontario Gym-
2012 MBQB 49. See also Renfrew Insurance Ltd. v. Cortese, nastic Federation, supra note 4; Kerzner v. American Iron &
2014 ABCA 203 (six-month, 60-kilometre non- Metal Company Inc., 2018 ONCA 989; and Pakozdi v. B &
competition restriction is reasonable in the case of insur- B Heavy Civil Construction Ltd., 2016 BCSC 992.
ance salespeople). 22. Machtinger v. HOJ Industries Ltd., supra note 17; and
15. The origins for the principle that a wrongfully dismissed Christensen v. Family Counselling Centre of Sault Ste. Marie
employee is relieved of their obligations under a restrictive and District, 2001 CanLII 4698 (Ont. CA).
covenant clause is the case of General Billposting Co. Ltd. v. 23. Alguire v. Cash Canada Group Ltd., supra note 19.
Atkinson, [1909] AC 118 (HL). See also Globex Foreign 24. Covenoho v. Pendylum Ltd., 2017 ONCA 284; Lovely v.
Exchange Corporation v. Kelcher, supra note 11; Cohnstaedt Prestige Travel Ltd., 2013 ABQB 467; Mohamed v. Informa-
v. University of Regina, 1994 CanLII 4566 (Sask. CA); tion Systems Architects Inc., 2018 ONCA 428; Howard v.
961945 Alberta Ltd (Servicemaster of Edmonton Disaster Benson Group Inc. (The Benson Group Inc.), 2016 ONCA
Restoration) v. Meyer, 2018 ABQB 564; and Ims Health 256; Spark v. Generex Pharmaceuticals Inc., 2003 CanLII
Canada Inc. v. Harbin, 2014 ONSC 4350. 52138 (Ont. CA); Canadian Ice Machine Co. v. Sinclair,
16. Chambly (City) v. Gagnon, [1999] 1 SCR 8; and Ceccol v. [1955] SCR 777; Martins v. 601360 N.B. Inc., 2010 NBCA
Ontario Gymnastic Federation, supra note 4. 16; Anderson v. Brouwer Claims Canada & Co. Ltd., 2002
17. See the discussion in Machtinger v. HOJ Industries Ltd., BCSC 1043; Chilagan v. Island Lake Band No. 161, 1994
[1992] 1 SCR 986 and Chapter 9. CanLII 4787 (Sask. QB); Gainer’s Inc. v. Paquin, 1991
ABCA 132; and Thompson v. Cardel Homes Limited Part-
18. Ibid. See also B. Etherington, “The Enforcement of Harsh
nership, 2014 ABCA 242 (contract provided that in the
Termination Provisions in Employment Contracts: The
event of early termination of a one-year fixed-term con-
Rebirth of Freedom of Contract in Ontario” (1990) 35
tract, the employer would pay 12 months’ pay). Note also
McGill LJ 459.
that there is no duty to mitigate damages owing based on
19. Chambly (City) v. Gagnon, supra note 16; Alguire v. Cash the remainder of a fixed-term contract, a point that will be
Canada Group Ltd., 2005 ABCA 387; Ceccol v. Ontario discussed in Chapter 14.
Gymnastic Federation, supra note 4; and Dombrowski v.
25. Hale v. Innova Medical Ophthalmics Inc., 2018 ONSC 1551;
Board of Governors of Dalhousie University and College,
Messer v. Barrett Co. (1927), 1 DLR 284 (Ont. CA); Hague
1974 CanLII 1290 (NSSC). Statutory notice of termination
v. St. Boniface Hospital, 1936 CanLII 193 (Man. QB); and
is usually also not required in the case of fixed-term con-
Duxbury v. Training Inc., 2002 ABPC 24.
tracts. For example, with a few special exceptions (listed
in Regulation 288/01, s. 2(2)), the notice of termination 26. See Nemeth v. Hatch Ltd., 2018 ONCA 7 (noting that the
and termination pay provisions in the Ontario Employ- contract language need not expressly state that the parties
ment Standards Act do not apply to contracts for a fixed agree to replace implied reasonable notice; it is sufficient if
term or task: Regulation 288/01, s. 2(1)1. that intention “can be readily gleaned from the language”).
20. Provincial Statutes of Frauds legislation, or the original 27. Studies have demonstrated that, contrary to the assump-
British statute from 1677 named An Act for Prevention of tion of the neoclassical perspective’s axioms discussed in
Frauds and Perjuries, made applicable in Canada through Chapter 3, workers have a very poor understanding of
“received law,” prohibits fixed-term contracts of longer than their legal rights in employment and information asym-
one year that are not in writing. Provincial Statutes of metries are endemic in the employment relationship. See,
Frauds legislation remain in effect in Ontario, Nova Scotia, e.g., J. Stiglitz, “Employment, Social Justice and Societal
Prince Edward Island, and New Brunswick. Courts have Well-Being” (2002) 141 Intl Lab Rev 9; and P. Kim, “Bar-
sometimes struck down fixed-term employment contracts gaining with Imperfect Information: A Study of Worker
of greater than one year applying this law: Smith v. Mills, Perceptions of Legal Protection in an At Will World”
1913 CanLII 147 (Sask. CA). However, courts have weak- (1997-98) 83 Cornell L Rev 105.
ened the application of the Statute of Frauds by ruling that it 28. See also Wood v. Fred Deeley Imports Ltd., 2017 ONCA 158
does not apply to employment contracts that could be per- (clause limited the employer to paying notice pay only,
formed within a year or that could be terminated by the while the ESA required continuation of benefits during the
employee within one year, which is most employment con- notice period. Even though the employer continued bene-
tracts: Annand v. Peter M. Cox Enterprises Ltd., 1992 CanLII fits coverage, the clause itself was illegal); and Wright v. The
4666 (NSSC); Campbell v. Business Fleets Limited, [1954] Young and Rubicam Group of Cos. (Wunderman), 2011
OR 87 (CA); and Lavallee v. Siksika Nation, 2011 ABQB 49. ONSC 4720.

29. See Wright v. The Young and Rubicam Group of Companies 34. Stephenson v. Hilti (Canada) Ltd., supra note 33.
(Wunderman)¸ supra note 28; Garreton v. Complete Inno- 35. On the “change to the substratum of the contract” doc-
vations Inc., 2016 ONSC 1178; Waddell v. Cintas trine, see Lyon v. Canadian Acceptance Corp. (1983), 3
Corp., 2001 BCCA 717; Covenoho v. Pendylum Ltd., supra CCEL 220 (Ont. H Ct J) (24-year service vice-president
note 24; and Shore v. Ladner Downs, 1998 CanLII 5755 was not bound by a notice clause in the contract he signed
(BCCA). But see Kerzner v. American Iron & Metal when originally hired as a junior clerk); Collins v. Kappele,
Company Inc., 2017 ONSC 4352 (chance of the term Wright & MacLeod Ltd. (1983), 3 CCEL 228 (Ont. Co Ct);
becoming non-compliant with the ESA was too remote to Rasanen v. Lisle-Metrix Ltd., 2002 CanLII 49611 (Ont. Sup
render the clause unlawful); and Davies v. Canada Shin- Ct J); Sawko v. Foseco Canada Ltd. (1987), 15 CCEL 309
eray Suppliers Group Inc., 2017 BCSC 304 (clause was not (Ont. Dist Ct); Schmidt v. AMEC Earth & Environment,
unlawful because it potentially restricted the employee’s 2004 BCSC 1012; and MacGregor v. National Home Ser-
right to bring a hypothetical human rights complaint). vices, 2012 ONSC 2042. See also Strench v. Canem Systems
30. See, e.g., Wood v. Fred Deeley Imports Ltd., supra note 28. Ltd., 2005 BCSC 1736 (the doctrine does not apply when
31. See Bowes v. Goss Power Products, 2012 ONCA 425. the contract term contemplates the changes that were
eventually made).
32. The doctrine of unconscionability is sometimes argued in
the context of “releases” presented to dismissed employees. 36. Statistics Canada, “Retirement Age by Class of Worker,
A release is a contract that offers an employee certain bene- Annual,” Table 14-10-0060-01, online: <https://
fits, such as continued payment of wages for a future period www150.statcan.gc.ca/t1/tbl1/en/cv.action?pid=14100060
“in consideration” for an agreement from the employee to 01#timeframe>.
not bring any legal proceedings against the employer. 37. See R. Luciw, “One-Third of Young Canadians Have No
Employees sometimes realize after they signed the release Retirement Savings,” Globe and Mail (1 August 2012),
that they would have been entitled to a greater amount of online: <http://www.theglobeandmail.com/globe
damages had they brought a wrongful dismissal lawsuit. In -investor/personal-finance/home-cents/one-third-of
order to set aside the release, they may argue that it was un- -young-canadians-have-no-retirement-savings/
conscionable. For a review of the origins and controversies article4453200/>.
associated with the doctrine of unconscionability, see 38. For discussion of retirement clauses, see, e.g., Foreman v.
McCamus, supra note 8 at 424-46; and S. Waddams, “Un- 818329 Ontario Limited, supra note 5; Vondette v. Vancou-
conscionability in Contract” (1976) 39 Mod L Rev 369. ver Port Corp., 1987 CanLII 2411 (BCSC); Heslop v. Coo-
33. See Heller v. Uber Technologies Inc., 2019 ONCA 1 at para per’s Crane Rental Ltd., 1994 CanLII 7384 (Ont. Sup Ct J);
60 (mandatory arbitration in Uber driver standard con- Engel v. Krug Furniture Inc., 1994 CanLII 7388 (Ont. SC);
tract is unconscionable); Stephenson v. Hilti (Canada) Ltd., Filiatrault v. Tri-County Welding Supplies Ltd., 2013
1989 CanLII 191 (NSSC); Harry v. Kreutziger, 1978 CanLII ONSC 3091; and Stock v. Best Form Brassière Canada Inc.
393 (BCCA); Lambert v. Digital Rez Software Corp., 2002 (1986), 15 CCEL 298 (Que. SC). See also McLaren v.
BCSC 481; Finlan v. Ritchie Bros. Auctioneers (Canada) Pacific Coast Savings Credit Union, 2001 BCCA 388 (an
Ltd., 2006 BCSC 291; White v. Corner Brook Pulp and employee’s comments that he intended to retire did not
Paper Ltd., 1996 CanLII 11710 (Nfld. SC); and Adamson v. relieve the employer of the duty to provide notice of ter-
Watts & Henderson (Atlantic) Ltd. (1987), 16 CCEL 74 mination); and Magnan v. Brandt Tractor Ltd., 2008
(Ont. H Ct J); and Morrison v. Coast Finance Ltd., 1965 ABCA 345.
CanLII 493 (BCCA).


CHAPTER 9
Implied and Ancillary Employment

Contract Terms
II. Implied Contract Terms 134
• Explain the difference between an implied contract term and an
A. On What Basis Do Judges Imply Contract Terms? 134
expressed contract term.
B. How Judges Use Implied Terms to Shape Employment
• Explain the methods courts use to justify the implication of contract terms. Contracts 136
• Describe how judges used implied terms to preserve the basic authority C. Implied Terms That Regulate the Conduct of Employees 138
structures that existed under the old master and servant laws. D. Implied Terms That Regulate the Conduct of Employers 142
• Describe the implied contract terms that regulate employee conduct. III. Contract Terms Found in Ancillary Documents 145
• Describe the implied contract terms that regulate employer conduct. IV. Chapter Summary 147
• Explain when an ancillary document, such as an employee handbook or
Exercise 148
human resource policy manual, is legally enforceable.
I. Introduction
In Chapter 7, we looked at the case of Rejdak v. Fight Network Inc., in which an employment
contract was created during a telephone conversation. The judge ruled that the terms of that
contract consisted of a job title, an annual salary, and a start date, all of which were agreed to
during the phone call. The conversation included an oral offer, an oral acceptance, and an agree-
ment that included mutual consideration. These elements formed a contract; nothing in writing
was required. Oral contracts based on brief conversations and short written contracts are not
uncommon in the employment setting, and they can govern the employment relationship
between parties for years. Inevitably, the juxtaposition of sparse contract terms and long-term
relationships often leads to many gaps in the coverage of a contract.
Must the employee do whatever the employer asks? Can the employer add new tasks to the
employee’s job or take away existing tasks? Is the employee’s behaviour outside of work any of
the employer’s business? What is required to terminate the contract? Can the employee compete
against the employer either during employment or after the employment relationship is over?
These are just some of the many questions that can arise during employment that are not
answered by the expressed terms of a contract. The law requires a method of resolving disputes
that arise during the life of the employment relationship, but that the parties did not specifically
address when they formed the contract.
Implied contract terms often perform this role in the common law regime. Implied contract
terms are made up by judges and inserted into (or “read into”) the contract. They are “default
contract terms,” in the sense that they fill gaps left by the contracting parties and are subject to
exclusion by the contracting parties.1 For example, one of the most important implied terms we
implied contract term: A default contract term invented by common law judges and read into an employment contract
when the written terms of the contract (if any) do not address the specific issue addressed by the implied term.
133

will learn about in this chapter is the requirement to provide “reasonable notice” before termi-
nating an employment contract (Chapter 10 explains this implied term in detail). However,
since “reasonable notice” is an implied term, it can be excluded by the contracting parties by the
inclusion in the contract of an expressed agreement to provide some other defined amount of
notice of termination, as we learned in Chapter 8.
Understanding implied terms is crucial to understanding employment contracts. Common
law judges have developed a set of standardized implied contract terms that form the bedrock
of employment contracts in the common law regime. Note that implied terms are as real as
expressed terms, as the Supreme Court of Canada has explained:
The law has always treated express and implied contract terms as being equivalent in effect. Breach
of an implied term is just as serious as breach of an expressed term.2
The implied terms discussed in this chapter form part of every (non-union) employment
contract in Canada, unless the parties have expressly agreed (orally or in writing) to exclude or
modify them.
In Chapter 8, we noted that there are three potential sources of employment contract terms:
expressed, implied, and ancillary contract terms. Ancillary contract terms are found in documents
that are physically separate from the employment contract, such as employee handbooks and bene-
fits manuals. This chapter will conclude with a discussion of these documents and the question of
their legal significance. Is a promise found in an ancillary document legally enforceable?
II. Implied Contract Terms

As noted in the introduction, implied contract terms are extremely important in the employ-
ment context. Many of the important rules that shape the employment relationship have their
foundation in an implied term. Before turning to consider the most important of these terms,
we will briefly consider how judges have justified their decision to imply terms into employment
contracts and how they used implied terms to construct a distinctive form of employment rela-
tionship that carried over many of the basic authority structures that had existed in the era of
master and servant law (discussed in Chapter 5).
A. On What Basis Do Judges Imply Contract Terms?

Courts have recognized two methods for implying contract terms: (1) implication of terms “in
fact” based on the presumed intentions of the parties; and (2) implication “in law” based on the
judges’ belief that it makes good policy sense to imply the term.
Tracing the origins of the first method takes us to the River Thames in London, England, in
1889 and the case of The Moorcock3 (see Box 9.1). The Moorcock decision relied on the “pre-
sumed intention of the parties” as the basis for implying the contract term. The idea is that, by
implying the term, the judge is simply giving expression to the agreement the parties themselves
intended all along. Courts have deployed various rhetorical devices to explain how they know
what the parties intended. In The Moorcock decision, for example, the court referred to a busi-
ness efficacy test. Applying this test, a contract term is deemed to be intended by the parties
when, in the court’s opinion, the term is necessary to make the particular contract involved ef-
fective.4 Thus, when a contract is to provide safe mooring for ships, the parties surely must in-
tend that the ship be safe for mooring.
ancillary contract terms: Contract terms found in written materials that are physically separate from an employment
contract but that include rules that relate to the employment relationship. Examples of ancillary documents include
employee handbooks, benefits handbooks, and human resources policy manuals.
business efficacy test: An approach used by common law judges to justify the implication of a contract term on the basis
that the term is necessary to make the contract effective.

Chapter 9 Implied and Ancillary Employment Contract Terms 135

The Moorcock and the Origins of the Implied Contract Term
The Moorcock was a cargo ship. Its owners contracted with a
“wharfinger”—a person or business that operates slips at a
wharf—to use one of its slips on the Thames. While moored on
the slip, the tide went out, causing the hull of the ship to smash
against a hard ridge, damaging the ship. The Moorcock owners
sued the wharfinger for breach of contract in an attempt to
recover damages. The court implied a contract term that re-
quired the wharfinger to take reasonable care not to endanger
the ship and ruled that the wharfinger had breached it. Lord
Justice Bowen explained when a judge can imply a contract
term:
I believe if one were to take all the cases … of implied

warranties or covenants in law, it will be found that The Moorcock unloading its cargo at London Docks.
in all of them the law is raising an implication from
the presumed intention of the parties, with the object Therefore, although the written contract itself was silent
of giving to the transaction such efficacy as both (said nothing) about whether the wharfinger was liable
parties must have intended that at all events it for damages caused to a ship while moored in its slip, the court
should have. In business transactions such as this, implied a contract term making it so. According to the court,
what the law desires to effect by implication is to give the parties must have intended that the ship would not be
such business efficacy to the transaction as must have damaged or destroyed in the course of the very business
been intended … by both parties.* [Emphasis (mooring and offloading) that the contract contemplated.
added]
* The Moorcock (1889), 14 PD 64.
In a 1939 decision, the British Supreme Court (known then as the House of Lords) intro-
duced the officious bystander test to explain how courts can determine if a term was intended
by the parties, described as follows:
[T]hat which in any contract is left to be implied and needn’t be expressed is something so obvious
that it goes without saying; so that, if while the parties were making their bargain an officious
bystander were to suggest some express provision for it in their agreement, they would testily sup-
press him with a common, “Oh, of course.”5
In Canada, the officious bystander test and business efficacy test have often been used inter-
changeably. Both tests involve courts assessing what the parties most likely intended to occur in
the circumstances.6
The presumed intent of the parties can also be gleaned from standard industry practices, the
facts in a particular case, the type of job involved, the parties’ conversations, and past practices
at a particular workplace.7 If a practice has long been followed at a workplace, and both parties
have accepted the practice, then a court may find that the parties intended that practice to
be incorporated into the contract as an implied term.8 In this way, a workplace norm (see
officious bystander test: An approach used by common law judges to justify the implication of a contract term based
on the presumed intention of the parties. The idea is that a contract term is implied if it would be obvious to an uninterested
bystander that both parties intended the term to be part of the contract.

Chapter 2) can rise to the level of an enforceable expectation when judges look to past practice
as an interpretive aid. For example, if changes to job duties have always been negotiated in the
past, a court may treat the obligation to negotiate such changes in the future as an implied term
of the contract.9 When terms are implied based on the presumed intention of the parties, they
are referred to as contract terms implied “in fact.”
The second method by which judges imply terms does not rely directly on the presumed
intentions of the parties at all. Sometimes judges imply contract terms based on their own view
of a legal duty that ought to be imposed because of the nature of the contract involved, including
an assessment of how the courts have long treated that type of contract. Terms implied in this
way are referred to as contract terms implied “in law.” Justice McLachlin of the Supreme Court
of Canada explained the key distinction between terms implied “in fact” and “in law” as
follows:
The intention of the contracting parties is relevant to the determination of some implied terms, but
not all. Intention is relevant to terms implied as a matter of fact, where the question is what the parties
would have stipulated had their attention been drawn at the time of contracting to the matter at issue.
Intention is not, however, relevant to terms implied as a matter of law.10
Many of the key implied terms in employment contracts are implied “in law” on the basis
that they have become standard terms of employment contracts unless the parties expressly
agree otherwise, including the implied term requiring reasonable notice of termination.11 In
practice, however, judges often do not explain the basis for the implied term at all. The terms are
just treated as standard implied terms of employment contracts, with little discussion of the
origins or basis for the implication.
B. How Judges Use Implied Terms to Shape Employment Contracts

The methods of implying contract terms confer a great deal of discretion on judges to shape
employment contracts. What might seem “obvious” to a judge might not be obvious at all to a
typical employee or employer. Does the hypothetical “officious bystander” take into considera-
tion what judges themselves have long recognized—that by virtue of its superior bargaining
power the employer can usually include almost any lawful term in the contract it likes? If so,
then the officious bystander test is really little more than a question of whether the employer
would have written the term into the contract had it thought to do so. The ability to imply terms
based on policy justifications or on long-standing custom in relation to employment contracts
in the case of terms “implied in law” casts the judge in the role of a pseudo-legislator, requiring
no consideration of the parties’ intentions at all.
Throughout the 19th and 20th centuries, British judges used the legal device of the implied
term to design a distinctive form of employment contract that carried over the basic structures
of authority that had defined the old master and servant regime (see Chapter 5), as described by
Professor Hugh Collins of Oxford University:
The economic relation between employer and worker was described in the same terminology, a
contract between master and servant, and into this contract the courts implied legal obligations that
preserved the authority relation.12
contract term implied “in fact”: A term implied into a contract by a judge that reflects the presumed intentions of the
parties.
contract term implied “in law”: A term implied into a contract by a judge as a matter of the legal duty that the judge
believes ought to be imposed due to the nature of the particular type of contract.

Professor Collins’ point is that the standard bundle of terms implied in employment con-
tracts by judges ensured a model based on subordination: the employer was assumed to have all
of the authority necessary to direct the employee as it deems fit, with a corresponding obligation
on the employee to serve the employer loyally and to act in the employer’s best interests, both at
work and sometimes outside of work too.
Because the ability to imply contract terms leaves so much discretion in the hands of judges,
we might theorize that the substance and application of implied terms would change as society’s
and judges’ attitudes and values evolve. Referencing the law of work framework presented
in Chapter 2, changes in the social, cultural, and religious subsystem would be expected eventu-
ally to infiltrate and influence the common law regime in the form of new or revised implied
terms. Evidence exists that this does in fact occur. Professor Geoffrey England described this
process:
[T]he golden thread in the evolution of employment contract law is that courts are continually
refashioning the legal rules in order to facilitate the operation of the prevailing standards of personnel
management practice; they also strive to reflect society’s changing vision of what an employment
relationship ought to resemble. The implied term is one of the main tools used by courts for this
purpose.13
A recent example of such an evolution is the recognition of a new implied term in Canada
since the late 1990s requiring employers to treat employees with “decency, civility, respect, and
dignity,” which is considered below.14 That it took until the end of the 20th century for common
law judges to recognize that the employment relationship should require decent and respectful
treatment by both parties (and not just employees) might seem surprising. However, it reflects
a current trend in employment law whereby judges are demonstrating more sensitivity to the
vulnerability of employees than judges of prior generations, a point that will be discussed at
various points in subsequent chapters.
TABLE 9.1 Standardized Implied Terms of Employment

Implied Terms That Regulate Employee Conduct Implied Terms That Regulate Employer Conduct
The following are standardized implied terms of employment contracts in Canada unless the parties have agreed otherwise.
• Obey lawful employer orders • Provide a reasonably safe work environment
• Serve the employer faithfully and cooperate in advancing the • Not impede the ability of the employee to perform their
employer’s commercial interests assigned work
• Provide reasonable notice of resignation • Treat employees with decency, civility, respect, and
dignity (duty of fair dealing)
• Not compete against the employer or use information to harm • Provide reasonable notice of termination
the employer
• Report to work when instructed and avoid lateness and unauthorized • Act in good faith and with decency in the manner in
absences which employees are terminated
• Be honest • To compensate employees for work performed
• Perform work competently and safely
• Avoid intoxication at work
• Avoid harassment of others

C. Implied Terms That Regulate the Conduct of Employees

Implied terms most often come before the courts in wrongful dismissal lawsuits filed by
employees against employers. We will learn in Chapter 12 that in the common law system, an
employer can dismiss an employee with no notice if the employee has committed a serious
breach of contract (called summary dismissal). An em-
ployee dismissed in this way may sue their employer for
wrongful dismissal, and in its defence, the employer will
argue that the employee breached a term of the contract,
including an implied term. The court must then decide
whether the implied term exists and whether it was
breached by the employee.
Over the years, the courts have developed a long list
of standardized implied terms that impose rules on
employees and are assumed to apply to all employment
contracts, unless the parties have expressly agreed
otherwise. The most important of these are described
below. Since employment contracts are usually drafted
by employers primarily to their benefit, it is rare that
expressed contract terms exclude these implied terms.
As a result, most employment contracts in Canada
include the following implied terms.
1. Implied Obligation to Obey the Lawful Orders of the Employer

The foundation of the employment contract is the duty of fidelity owed by employee to em-
ployer. This duty is most clearly captured in the first two implied terms we will discuss. The first
is the implied obligation of employees to obey the employer’s lawful orders. The leading au-
thority for this implied term is the 1959 British case Laws v. London Chronicle (Indicator News-
papers) Ltd., in which the court stated:
[W]ilful disobedience of an order will justify summary dismissal, since wilful disobedience of a
lawful and reasonable order shows a disregard—a complete disregard—of a condition essential to
the contract of service, namely, the condition that the servant must obey the proper orders of the master
and that, unless he does so, the relationship is, so to speak, struck at fundamentally.15 [Emphasis
added]
The implied obligation to obey the employer’s orders colours the entire employment contract,
informing us that the consideration an employee gives an employer is the employee’s submission
to the direction and control of the employer. When an employee breaches the implied term
requiring obedience to the employer’s lawful orders, it is known as insubordination (see also
the discussion in Chapter 12 on summary dismissal for cause).16 This implied term was
explained succinctly by the BC Court of Appeal in the 1992 case Stein v. British Columbia Hous-
ing Management Commission:
wrongful dismissal: A type of lawsuit by an employee against a former employer alleging that the employer terminated
their contract without complying with the implied term in the contract requiring “reasonable notice.”
summary dismissal: Termination of an employment contract by an employer without notice to the employee in response
to a serious breach of contract by the employee.
insubordination: A breach by an employee of the implied or expressed term of an employment contract requiring the em-
ployee to obey an employer’s orders and instructions.

I begin with the proposition that an employer has a right to determine how his business shall be
conducted. He may lay down any procedures he thinks advisable so long as they are neither contrary
to law nor dishonest nor dangerous to the health of the employees and are within the ambit of the
job for which any particular employee was hired. It is not for the employee nor for the court to con-
sider the wisdom of the procedures. The employer is the boss and it is an essential implied term of every
employment contract that, subject to the limitations I have expressed, the employee must obey the orders
given to him.17 [Emphasis added]
The duty of employees to follow their employer’s orders is not absolute, as this passage notes.
An employee can refuse “unlawful” orders, such as those that would require the employee to
violate a statute or commit a tort (see Chapter 12), or orders that would put the employee or
someone else in physical peril. In addition, an employee is not required to obey an order that is
fundamentally inconsistent with the terms of the contract. For example, an employee is not
required to accept a demotion, which is a reassignment to a lower paying or less prestigious
job.18 In many cases, an employee who refuses an employer’s order that the employee believes
violates the contract—such as an order to accept a demotion—will quit and sue the employer
for constructive dismissal, which we will explore in detail in Chapter 13. A constructive dis-
missal occurs when an employer commits a serious violation of the contract that the employee
treats as a termination of the contract.
However, courts have ruled that the implied term requiring employees to obey lawful
employer orders encompasses an implied right of employers to make “reasonable” and non-
fundamental changes to an employee’s job that do not amount to a demotion. As one judge put
it recently, it is “an implied term of any contract of employment … that the employer has the
right, if it sees fit to do so, to make a reasonable reassignment of an employee to other duties.”19
A reassignment of job duties is more likely to be considered “reasonable” if it is relatively minor,
if it does not involve a reduction in pay, and if, due to the nature of the job or to a past practice
of similar job reassignments, the employee would have expected that such changes might
occur.20
2. Implied Obligation to Serve the Employer Faithfully and to Cooperate in

Advancing the Employer’s Commercial Interests
Employees have an implied obligation of “fidelity,” which basically means that they are
required to serve the employer faithfully in a manner that advances the employer’s commer-
cial interests.21 A classic example of this implied term can be seen in a 1972 case involving Brit-
ish train drivers who, in an attempt to apply pressure on their employer to agree to
improved working conditions, engaged in what we now call a “work to rule.” That is, they com-
plied meticulously with the terms of their employment contract. Doing so caused the rail
system to come to a screeching halt. The interesting part of this case is that the workers were
complying with the written terms of their employment contracts, but the court was asked to
nevertheless rule that the “work to rule” was a breach of their contracts. And that is what the
court did. Lord Justice Buckley ruled that “an employee must serve the employer faithfully with
a view to promoting those commercial interests for which he is employed.”22 Hence, the train
drivers were in breach of the implied term requiring them to serve their employer faithfully and
to promote the employer’s commercial interests by strictly complying with the written contract
terms!23
demotion: A reassignment of an employee’s position by an employer to another position with lower pay, less prestige, or
less responsibility.
constructive dismissal: A fundamental change to an employment contract by an employer that an employee may treat
as an effective termination of the contract.

The overriding implied obligation on employees to serve the employer faithfully with a view
to advancing the employer’s commercial interests, along with the related implied obligation on
employees to obey lawful employer orders, confers on employers a substantial degree of control
over their employees. This is what Professor Collins meant (page 136) when he said that judges
used implied terms to carry over the basic authority structures from the master and servant
model into the employment contract model.
All of the implied terms described below that impose obligations on employees may be
understood as corollaries of these first two implied terms. Indeed, with the exception of the
implied term requiring employees to provide the employer with reasonable notice of termina-
tion, the following implied terms are often just lumped together by the courts under a general
“implied duty of fidelity and faithful service” rather than singled out as separate implied terms.24
Not much turns on how we label the implied terms. However, it is useful to list them, and we
will do so briefly here. We will come across some of these terms again later in this text when we
discuss termination for cause (Chapter 12) and constructive dismissal (Chapter 13).
3. Implied Obligation to Provide Reasonable Notice of Resignation

Employees are subject to an implied term requiring them to provide reasonable notice before
terminating the employment contract. This obligation mirrors the employer’s implied obligation
to provide reasonable notice (see Section D, “Implied Terms That Regulate the Conduct of
Employers”), although the manner in which the courts calculate the amount of notice is differ-
ent.25 The purpose of requiring employees to provide notice of resignation is to allow the em-
ployer time to find and train a replacement. Therefore, the length of notice required to resign
varies according to the type of job involved, the practice in an industry, and the difficulty the
employer will have replacing the employee. It will almost always be less than the amount of rea-
sonable notice that courts order employers to provide employees. As is the case with all implied
terms, the implied obligation to provide “reasonable notice” (the amount of which is determined
by the courts) can be overridden by an expressed agreement of the parties that defines the
amount of notice required. We consider the assessment of reasonable notice of resignation more
fully in Chapter 15.
4. Implied Obligation to Not Compete and to Protect Confidential Information

An obvious corollary of the implied obligation to advance the employer’s commercial interests
is the implied term prohibiting employees from competing against their employer during the
employment relationship.26 An employee who secretly earns income competing against their
employer is in breach of the employment contract. Note that this obligation to avoid competi-
tion only applies while the employment contract subsists. There is no implied obligation on an
employee to refrain from competing against a former employer, although as discussed in Chap-
ter 8, there may be a written (expressed) non-competition clause. Absent an expressed non-
competition clause, an employee is entitled to compete against their employer any time after
they have quit or given the employer notice that they are quitting.
The Supreme Court of Canada explained this point as follows in RBC Dominion Securities v.
Merrill Lynch Canada (see Box 9.2):
Generally, an employee who has terminated employment is not prevented from competing with his
or her employer during the notice period, and the employer is confined to damages for failure to give
reasonable notice. To this general proposition [can be added] the qualification that a departing em-
ployee might be liable for specific wrongs such as improper use of confidential information during
the notice period.27


Implied Term Prohibiting Employees from Competing with Their Employer
RBC Dominion Securities Inc. v. Merrill Lynch Canada Inc. weeks based on industry norms. The court calculated dam-
2008 SCC 54 ages based on the profit that the advisers would have earned
for RBC during that period, which was determined to be
Key Facts: DD was branch manager of RBC Dominion Secur- $40,000 in total. Second, as branch manager, DD’s implied
ities in Cranbrook, British Columbia. In 2000, DD quit RBC duty of good faith service to RBC included an obligation to
without notice and immediately commenced employment retain the investment advisers and not to persuade them to
with RBC’s competitor, Merrill Lynch. While employed by RBC, join a competitor. DD also breached this term. Third, the em-
DD had encouraged investment advisers under his supervision ployees breached the implied obligation in their contracts to
to follow him to Merrill and all but two did so, leaving the RBC not misuse confidential information to harm RBC when they
office decimated. DD and the other advisers also copied con- copied and removed from RBC a list of RBC’s clients and gave
fidential RBC client information several weeks before they quit it to Merrill.
RBC and gave this information to Merrill. As a result of the DD was ordered to pay damages amounting to nearly $1.5
sudden departure of its investment advisers, RBC suffered sig- million based on lost profits to RBC caused by the mass exodus
nificant financial losses. RBC sued DD and the other former of almost all of its investment advisers with no notice and the
investment advisers for breach of the implied terms in their misuse of RBC’s confidential information. The court also or-
contracts requiring them to serve RBC in good faith and to dered the investment advisers to pay $5,000 each and DD to
provide RBC with notice of termination. pay $10,000 in punitive damages to RBC based on the misap-
Issue: Did DD and the other investment advisers breach im- propriation of RBC’s customer lists for the benefit of Merrill
plied terms in their employment contracts to serve RBC faith- Lynch.*
fully and provide notice of termination?
* The court also ordered significant damages against Merrill Lynch and
Decision: Yes. First, all of the RBC employees breached their a manager employed by it who helped orchestrate the departure of
implied duty to provide reasonable notice of termination to DD and the investment advisers from RBC. Note also that Merrill Lynch
agreed to pay all of the damages ordered against DD and the
RBC. The court fixed that period of notice at two and a half
investment advisers.
As the court notes at the end of this passage, an employee—even one who has quit—cannot
use confidential information obtained from their employer to harm the employer’s commercial
interests. Confidential information includes a trade secret or other confidential business infor-
mation that is removed from the employer’s premises, including a list of customers (although,
absent a non-competition clause, an ex-employee is permitted to contact former customers of
the former employer if they do so from memory rather than from a document improperly
removed from the workplace).28
5. Implied Obligation to Report to Work and to Avoid Lateness and Absenteeism
The employer has the implied (and sometimes the expressed) right to determine the work
schedule. Absenteeism and lateness can be a violation of the employee’s obligation to obey
orders or, more specifically, an implied contract term recognized by judges requiring employees
to attend work when scheduled.29
6. Implied Obligation to Be Honest

An employee must be honest with the employer, which obviously includes avoiding deliber-
ate dishonesty and theft.30 Some courts have added that this obligation also includes not
concealing from the employer “facts which ought to be revealed.”31 That is vague language,
and the scope of its possible application is uncertain, but it has been applied, for example, to a
bank manager who kept secret from his employer an affair he was having with one of his
subordinates.32

7. Implied Obligation to Perform Competently and Safely

Canadian courts have recognized an implied obligation on employees to perform their job
competently.33 The effect of this implied term is that incompetent job performance by an em-
ployee is a breach of contract. However, as we will see in Chapter 12, the courts have also ruled
that only serious or “gross” incompetence would normally justify a summary dismissal.
8. Implied Obligation to Avoid Intoxication

Judges have long implied a term that intoxication at work is prohibited.34 Employees who report
to work intoxicated are putting themselves, others, and employer property at risk. In practice,
this implied term often becomes relevant when an employee is accused of breaching another
term of the contract, such as the requirements of competent performance and proper attend-
ance. In such cases, the intoxication causes absenteeism or performance problems. As we will
see in Chapter 12, whether intoxication is grounds for summary dismissal usually depends on
how seriously it undermines the employee’s job performance.35 It is notable too that when the
employee involved is an alcoholic or addicted to drugs, human rights laws may impose obliga-
tions on the employer that may restrict the right of the employer to terminate the employee. We
will consider that issue in Part III when we look at disability at work.
9. Implied Obligation to Avoid Harassment

Many employers include anti-harassment provisions in the written terms of their employment
contracts, and those terms have been found to have been breached by an employee in numerous
decisions.36 However, even if this obligation is not an expressed term, common law judges have
found harassing employees to be in breach of implied obligations to avoid harassment at work.37
Whether the harassment is serious enough to constitute grounds for summary dismissal
depends on the seriousness of the harassment, whether the employer had a well-known harass-
ment policy, whether the employee was in a position of authority, and a variety of other factors.38
We will consider this issue further in Chapter 12.
D. Implied Terms That Regulate the Conduct of Employers

So far, this chapter has demonstrated the extent to which common law judges have used implied
terms to shape employment contracts that ensure employees are subservient to their employers.
The implied terms discussed above form part of every Canadian employment contract—unless
the parties have bargained them out of the contract. Judges have not been completely one-sided,
however. They have also implied terms that impose requirements on employers and benefit
employees.
1. Implied Obligation to Provide Reasonable Notice of Termination of an

Employment Contract
Since the early 20th century, Canadian judges have implied a contract term requiring employers
to give the employee “reasonable notice” of the termination of an indefinite-term employment
contract. Judges decide how much notice is “reasonable” by applying factors we will consider at
length in Chapter 10. Employers frequently attempt to avoid the implied obligation to provide
reasonable notice by writing a notice of termination clause directly into the contract. However,
as we noted in Chapter 8, disputes over the application of the implied term requiring reasonable
notice of termination are the most frequently litigated issues in the common law regime.
2. Implied Obligation to Provide a Reasonably Safe Work Environment

Long before modern workers’ compensation legislation came into effect, common law courts
had implied a duty on employers to take reasonable care to ensure workers are not put in

unreasonable danger in the performance of their job. Lord Herschell described the duty in an
1891 decision: “It is quite clear that the contract between employer and employed involves on
the part of the former the duty of taking reasonable care to provide proper appliances and to
maintain them in a proper condition and so to carry on his operations as not to subject those
employed by him to unnecessary risk.”39 This implied term has mostly been overtaken by work-
ers’ compensation legislation, which replaces the right of employees to sue for breach of this
term in exchange for a no-fault insurance scheme, and by occupational health and safety legis-
lation, which imposes workplace safety rules and a right to refuse unsafe work. We consider
both types of legislation in Chapter 24.
3. Implied Obligation to Treat Employees with “Decency, Civility, Respect, and
Dignity” and to Engage in “Fair Dealing”
We noted earlier that judges sometimes develop new implied terms that reflect the evolution of
social and cultural values. An example of this process is the development of the implied duty on
employers to treat employees with “decency, civility, respect, and dignity.”40 This implied term
has deep roots, but Canadian judges have only recently begun to apply it to employment situa-
tions involving verbal, physical, and psychological harassment at work.41 One of the earliest
decisions to explicitly recognize and apply the implied term requiring decency, civility, respect,
and dignity was Lloyd v. Imperial Parking Ltd., described in Box 9.3.

Implied Terms and Decent and Respectful Treatment of Employees
Lloyd v. Imperial Parking Ltd. A fundamental implied term of any employment
1996 CanLII 10543 (Alta. QB) relationship is that the employer will treat the em-
ployee with civility, decency, respect, and dignity. The
Key Facts: Lloyd quit his employment after being subjected standard that has to be adhered to by the employer is
to months of verbal abuse and constant threats to his employ- dependent upon the particular work environment. This
ment by a superior at Imperial Parking Ltd. (his employer). He appears to be part of the trend to establish a duty upon
sued the employer for “constructive dismissal,” arguing that the an employer to treat employees “reasonably” in all
employer’s abuse amounted to a fundamental breach of the aspects of the labour process.
employment contract. In this case, a fundamental implied term of the
Issue: Did the employer commit a fundamental breach of the employer/employee relationship has been breached.
employment contract by engaging in a pattern of verbal Mr. Noiles, Mr. Lloyd’s superior, did not treat Mr.
abuse, giving rise to a constructive dismissal? Lloyd with the civility, decency, respect, and dignity
to which he was entitled. The abusive pattern of
Decision: Yes. Here is the key passage from the decision: behaviour during 1993 was in contravention of this
requirement. [Emphasis added]
It is well-recognized that in the absence of cause,
any fundamental breach by the employer of a major The breach of the implied duty on the employer to treat
term of the employment relationship allows the employees with decency, civility, respect, and dignity gave rise
employee to take the position that a constructive to a constructive dismissal. The court ruled that the employer
dismissal has occurred. In order for a constructive was required to have given Lloyd four months’ notice of ter-
dismissal to exist, the breach must be in relation to mination, and the employer was ordered to pay damages to
a fundamental term of the employment relationship Lloyd for moneys he would have earned during that four-
rather than just a minor or incidental term. There month period (nearly $30,000).
must be a fundamental breach of a fundamental
term of employment before one can claim to be
constructively dismissed.

The implied duty of decent treatment of employees has since been applied by Canadian
courts to a range of bullying and unfair treatment by employers. The courts considered the term
breached as a result of the following employer behaviour: failure to put an end to verbal harass-
ment of an employee by a supervisor,42 being dishonest with an employee and offering the em-
ployee money to “go away,”43 engaging in “unrelenting criticism” of an employee,44 and locking
an employee out of her office with no explanation.45 These situations are a few of the many in
which the courts found that an employer had treated its employee harshly and unfairly.
In 2014, the Ontario Court of Appeal recognized a similar, arguably broader implied obliga-
tion on the employer to treat the employee with “good faith and fair dealing.”46 The court ruled
that Wal-Mart Canada had violated this term by failing to properly investigate and take steps to
stop ongoing harassment of a female employee. Wal-Mart was ordered to pay $300,000 in aggra-
vated and punitive damages.
4. Implied Obligation to Permit Employees to Work (or Not to Prevent

Employee Performance)
Employees have a right to come to work. This does not mean they have a “right” to their job—
employees can be dismissed, and, as we saw earlier, an employer has an implied right to make “rea-
sonable” work reassignments. However, an implied term in employment contracts requires
employers to permit employees to perform the labour their contracts contemplated and to pay them
for that labour. This is a corollary of the more general implied term in contracts that the parties will
cooperate in the fulfillment of the objectives of the contract and not prevent performance.47
The implied obligation of an employer to not prevent the employee from performing their
labour has important implications that often surprise employers. For example, an indefinite
layoff and an unpaid suspension violate this implied term since both involve the employer
refusing employees the opportunity to perform their end of the contract.48 The employer is
essentially saying, “stay home until I decide to let you come back to work.” It is a breach of the
contract for an employer to do that, unless the contract includes an expressed right to suspend
or lay off employees, or there is a well-established history in the industry of temporary layoffs
that the employee can be presumed to have agreed to.49 One judge explained why a layoff con-
stitutes a fundamental breach of the employment contract as follows:
In an employment contract, the essential elements are the offer by the employee to work and by the em-
ployer to provide work and to pay compensation. Absent a provision permitting the employer to
suspend the obligation to provide work for an indefinite term, even with an undertaking to recall
upon work being available, the effect on an employee is really no different than in a termination
where the employer undertakes to rehire, if a position later becomes available.50
An employee who is laid off in the absence of a contract term permitting layoffs is probably
entitled, if they so choose, to quit and sue the employer on the basis that they were “construct-
ively dismissed” when the employer prevented them from coming to work. We will consider the
application of this implied term again when we examine constructive dismissal in Chapter 13,
including a case called Carscallen v. FRI Corporation later, in which an unpaid suspension is
ruled to be a fundamental breach of the employment contract.51
5. Implied Obligation to Compensate Employees for Work Performed

Modern employment standards legislation (Part III) includes a requirement for employers to
pay employees wages and rules on what wages are acceptable (minimum wages, overtime pay,
layoff: A non-disciplinary suspension imposed by an employer of the employee’s right to come to work, usually due
to a lack of available work.
unpaid suspension: A temporary suspension of an employee’s right to come to work imposed by the employer as
a form of discipline for employee misconduct.

etc.). However, even before such legislation, the common law recognized an obligation for
employers to compensate workers for their labour.52 This implied obligation was either based
on the presumed intention of the parties or flowed from an old legal concept known as
quantum meruit. Quantum meruit (Latin for “the amount it deserves”) permits judges to order
payment for services based on a fair assessment of the value of the services when a contract
does not specify a rate of pay or where there was no formal contract entered into in relation to
that labour.53
6. Implied Obligation to Act with Good Faith in the Manner of Dismissal of an
Employee
We will explore this final implied term at length in Chapter 14 when we consider how courts
assess damages in cases involving the wrongful termination of employees. Therefore, we will
provide just a quick introduction here. In two important cases, Wallace v. United Grain Growers
(1997) and Honda v. Keays (2008), the Supreme Court of Canada recognized an implied obliga-
tion of fair dealing and good faith in the manner in which an employer terminates an em-
ployee.54 To be clear, this implied term does not prevent an employer from terminating an
employee or even require an employer to have a reason to do so. Rather it requires an employer
to treat employees professionally, sensitively, and with decency in the manner in which the ter-
mination is implemented. Employers who have been dishonest or just plain mean when they
terminate employees have been ordered to pay large damage awards for breaching the implied
obligation to act in good faith in the manner of dismissal. Examples are discussed in Chapter 14.
III. Contract Terms Found in Ancillary Documents

Many workplaces have documents that describe rules that apply to the employment relation-
ship, such as employee handbooks, human resource policy manuals, retirement plans, and bene-
fits handbooks. These documents might stipulate rules relating to termination of employment,
discipline, or benefits eligibility or entitlements, among other things. The courts are sometimes
asked to decide whether the rules found in ancillary documents are legally enforceable. The
answer depends on whether those documents constitute a separate legal contract or are part of
the existing employment contract.55 If neither, then the terms of the ancillary document are not
enforceable.
The central point to recall is that an enforceable contract consists of a mutually agreed upon
promise consisting of an intention to create legal relations, and an offer, acceptance, and mutual
consideration, as we learned in Chapter 7. At a minimum, both parties need to know about the
ancillary document, and there must also be clear evidence that both agreed to its terms and
understood and intended that the document would be legally enforceable. A document pre-
pared unilaterally by an employer but never actually provided to the employee will not be legally
enforceable. How can an employee accept terms they are not even aware exist?
If the ancillary document exists at the time the parties enter into the employment contract,
then it can be expressly incorporated into the contract by clear language, such as, “The Em-
ployee Handbook attached to this contract forms part of this employment contract.” That sort
of clear language would head off future disputes about whether the handbook is enforceable.
Similarly, if the employee is provided with the ancillary document and advised orally at the time
the contract is formed that the terms in it comprise part of the employment contract, then that
too would have the effect of incorporating the document into the employment contract.56 In
these scenarios, the requirement of mutual consideration is satisfied, since the terms in the
ancillary document form part of the initial exchange of promises and benefits in the employ-
ment contract.
quantum meruit: An entitlement to be paid a fair market rate for work performed when the amount is not stipulated in a
contract.

However, in many of the reported court decisions, the ancillary document was introduced by
the employer at some point during the employment relationship, rather than when the employ-
ment contract was initially negotiated.57 In that case, the terms in the ancillary document are
legally enforceable only if two conditions are satisfied.
First, it must have been made clear to the employee that the new document was intended to
be legally enforceable, and the court must be satisfied that the employee understood and agreed
to that condition. The employee’s agreement will not be assumed from the fact that the employee
continues to work after the document is given to them. The employee was already required to
come to work before the new document was introduced, so continuing to work afterward does
not establish agreement to any changes found in the document, as explained in the Rahemtulla
v. Vanfed Credit Union case in Box 9.4.58

Is an Ancillary Document Introduced During a Contract Enforceable?
Rahemtulla v. Vanfed Credit Union Communication of assent [to terms in an employee
1984 CanLII 689 (BCSC) manual] cannot be inferred from the fact that the
[employee] continued to work after being given the
Key Facts: Rahemtulla was terminated from her job as a bank manual. She had contracted to work for the [em-
teller after 15 months’ employment. The employer accused her ployer] prior to receiving the manual. The fact that
of theft of money, although at trial it argued that the termin- she continued to fulfil this obligation after being
ation was not for cause. The employment contract was indefin- given the manual cannot be taken as an assent to
ite in duration and did not include a notice of termination its terms.
clause. However, the employer sought to rely on a term found
in a policy manual that had been handed to the employee a Moreover, Rahemtulla had received no new consideration in
few days after she commenced employment. The manual exchange for the rights granted to the employer in the
stated that the employer could terminate an employee by manual:
providing two weeks’ notice, which the employer had given
the employee in this case. The employee argued that the policy [I]t may be questioned whether there was valid con-
manual was neither part of her employment contract nor a sideration for the promise the plaintiff is alleged to
separate binding contract and therefore was not enforceable, have made to be bound by the policy manual. Per-
and she was entitled to implied reasonable notice. formance of an existing duty is no consideration:
Stilk v. Myrick (1809) … . The defendant’s obligation
Issue: Is the notice of termination provision found in the policy to employ having arisen before delivery of the policy
manual enforceable? manual, its performance of that obligation cannot
constitute consideration for any new terms imposed
Decision: No. The court explained: on the plaintiff by the manual.
[I]f the terms of the policy manual are to be binding, Since Rahemtulla had not agreed to the terms in the manual
it must be concluded that they have contractual and, in any event, there had been no new consideration given
force. The usual elements of a contract must be es- to her in exchange for the right of the employer to terminate
tablished: a concluded agreement, consideration, with two weeks’ notice, the term in the manual was not en-
and contractual intention. forceable. Rahemtulla was entitled to reasonable notice, which
the court fixed at six months. The employer was ordered to
Here, the employer provided the manual to Rahemtulla, but pay an amount equal to six months’ wages, plus an additional
there is no evidence that she accepted it as part of her contract. $5,000 in mental suffering damages for “recklessly” accusing
The fact that she continued to work after she was given the Rahemtulla of theft. (See Chapter 14 for a discussion of mental
manual and she did not verbally object to the manual’s terms suffering damages.)
cannot be treated as acceptance because she was already re-
quired to work under the original contract terms:

Second, even if the employee agreed to the new terms found in the ancillary document, per-
haps signing the document, those terms will still not be enforceable unless both the employer
and employee received “new consideration” when the ancillary document was introduced.59
Mutual consideration is required for an agreement to be legally enforceable, and this require-
ment applies to any modifications to the employment contract introduced through an ancillary
document, as we saw in Chapter 7.
In the case described in Box 9.5, the court ruled that the ancillary document was enforceable.
See if you can identify what distinguishes the Johnson decision from the Rahemtulla decision.

Are Terms in Ancillary Documents Enforceable?
Johnson v. Global Television Network Inc. (CH Vancouver Issue: Was the term in the pension plan document requiring
Island) retirement at age 65 legally enforceable?
2008 BCCA 33
Decision: Yes. At the trial, Johnson testified that he was
Key Facts: About nine years into his oral employment contract, made aware of the mandatory retirement requirement in the
Johnson elected to participate in a voluntary pension plan pension plan and that he believed it was part of his employ-
offered by his employer, Global Television Network Inc. This ment contract. Therefore, the court ruled that there was a
required Johnson and Global to make regular contributions to common intention formed that the mandatory retirement
the plan. Johnson never received a copy of the pension plan, term would be a legally enforceable contract term. In addi-
but he did receive a brochure describing the plan, including a tion, Johnson had received new consideration in exchange
term of the plan that required Johnson to retire on his 65th for the introduction of the mandatory retirement term “in
birthday. When Johnson reached 65, the employer informed the form of contributions made to his pension plan by [the
him that his employment was over, pursuant to the mandatory employer] for approximately 30 years.” As a result, the man-
retirement term in the pension document. Johnson sued for datory retirement term was enforceable, and Johnson was
wrongful dismissal, arguing that the mandatory retirement only entitled to wages and benefits up to his mandatory
term in the pension plan was not enforceable and that he was retirement date.
entitled to “reasonable notice” of termination.
IV. Chapter Summary

This chapter examined the origins and substance of the key standard implied terms that govern
non-union employment contracts in Canada. As you can see, they are extensive. Many of these
terms have their origins in old British case law, but some, such as the implied obligation on
employers to treat employees with decency, civility, respect, and dignity, are of relatively recent
vintage. Implied terms form the foundation of the employment contract in Canada, acting as
the default distribution of rights and responsibilities. However, because implied terms fill gaps
in the expressed language of the contract, they are subject to being overridden by the parties in
a written or oral agreement. We will see more examples of implied terms and how they impact
the employment relationship in Canada in later chapters.
This chapter also explained the legal significance of promises and obligations that are found
in ancillary documents that are physically separate from the employment contract. We learned
that courts closely scrutinize ancillary documents to confirm that both parties understood and
intended them to be legally enforceable.

1. Do all of the implied contract terms discussed in this chapter apply to every employment
contract in Canada?
2. Explain the difference between contract terms implied “in fact” and contract terms implied
“in law.”

3. Identify and describe a standard implied term in employment contracts that has been
recognized by Canadian courts only during the past 25 years.
4. “Insubordination” is the term used to describe a violation of which implied contract term?
5. Explain what Professor Hugh Collins meant when he wrote that judges used implied terms
to preserve “the authority relation” that had existed under the old master and servant laws
discussed in Chapter 5.
6. When is a term found in an ancillary document (such as an employee handbook) legally
enforceable?
APPLYING THE LAW

1. Daphne has worked for a local florist for 10 years. She their windows, telling them his company was cheaper
never signed an employment contract. The owner, Jill, than New View. Last week, Jim, the owner of New View
asked her if she was looking for a job, and Daphne said Windows, found out about Seamus’ side business and
she was. Daphne started the next day and has worked he terminated Seamus for cause. Seamus is furious, and
full time at the florist ever since. However, last month he points out to you that his contract with New View
Jill told Daphne that business had slowed and that as a Windows says nothing about whether he can create a
result she had to lay off Daphne until things picked up. competing window cleaning business. Is Seamus cor-
Daphne was upset but understood. A couple of weeks rect that his employment contract with New View did
into the layoff, Daphne decided she did not want to re- not prohibit him from creating a competing business?
turn to the flower shop even if she was recalled. Daph- 3. Maggie has also worked for New View Windows as a
ne assumes that she is not entitled to anything from window cleaner for a few years. However, unlike Sea-
the employer because she does not have a written em- mus, she never signed a written employment contract.
ployment contract and she was not actually termin- Seamus persuades Maggie that she would be better off
ated. Daphne hears that you have taken an quitting New View and coming to work for Spotless
employment law class and so she asks you whether she Windows. Last week, Maggie quit New View with no
has any potential claim against the florist in these cir- notice and immediately began working for Spotless—
cumstances. Does she? she just didn’t show up for work one day, and as a re-
2. Seamus was a window cleaner employed by New View sult New View had to pay another window cleaner
Windows. He had signed a simple employment con- overtime pay (an extra $400 above what Maggie would
tract that did not include a written non-competition have been owed had she reported to work) to cover
clause. Seamus had been employed by New View for her work for three days until a replacement could be
nearly eight years. Last year, Seamus and his cousin hired. Jim asks you whether he has any potential legal
started a business called Spotless Windows. Seamus action against Maggie for quitting and leaving him
sometimes gave his Spotless Windows business card “high and dry” and then joining a competitor.
out to New View customers when he was out doing
EXERCISE
Try the following legal research exercise, which involves finding case law dealing with implied
contract terms.

2. In the “Document text” search box, type “employment contract” and “implied term.” This
search should return hundreds of Canadian decisions.
3. Select three decisions that look interesting to you from the brief summary of the decision
provided in the case header and read them. For each, identify the part of the decision that
discusses “implied terms” and answer the following questions:
a. What implied term is being discussed? Is it one that is identified in this chapter or some
other implied term?

b. Does the court find that the implied term was breached in the case?
c. Does the judge explain the method by which the term was implied?
d. Was there an expressed or written contract term that modified or overrode the implied
term in the case?
e. If the implied term was breached in the case, was a remedy ordered for that breach? If
so, what was it?

1. H. Collins, Employment Law, 2nd ed (New York: Oxford 13. G. England, Individual Employment Law (Toronto: Irwin,
University Press, 2010) at 35. 2008) at 38. See also Wilson v. Racher, [1974] IRLR 114
2. BG Checo International Ltd. v. British Columbia Hydro and (CA) at para 5, where Edmund-Davies LJ explains how ju-
Power Authority, [1993] 1 SCR 12 at para 31. dicial attitudes on the appropriate treatment of employees
by employers has evolved over time to reflect changing
3. The Moorcock (1889), 14 PD 64 at 68.
“social conditions.”
4. Another important early case applying the “business effi-
14. See D. Doorey, “Employer Bullying: Implied Duties of Fair
cacy” test for implying contract terms is Reigate v. Union
Dealing in Canadian Employment Contracts” (2005) 30
Manufacturing Co., [1918] 1 KB 892. See also the discus-
Queen’s LJ 500.
sion in Hawkes v. Levelton Holdings Ltd., 2013 BCCA 306
para 63; and Carscallen v. FRI Corp., 2005 CanLII 20815 15. Laws v. London Chronicle (Indicator Newspapers) Ltd.,
(Ont. Sup Ct J). [1959] 2 All ER 285 (CA). See also Hivac Ltd. v. Park Royal
Scientific Instruments, [1946] 1 All ER 350 at 353.
5. Shirlaw v. Southern Foundries (1926), Ltd., [1939] 2 KB 206
at 227. See also Merilees v. Sears Canada Inc. (1986) 16. Panton v. Everywoman’s Health Centre Society (1988), 2000
CanLII 723 (BCSC) at 169; aff ’d 1988 CanLII 3009 BCCA 621; Adams v. Fairmont Hotels & Resorts Inc., 2009
(BCCA). BCSC 681; Candy v. C.H.E. Pharmacy Inc., 1997 CanLII
4135 (BCCA); Staley v. Squirrel Systems of Canada, 2013
6. J. McCamus, The Law of Contracts, 2nd ed (Toronto: Irwin,
BCCA 201 (implied term that the employee work in
2012) at 779-89.
British Columbia was violated when then employee insub-
7. For example, in RBC Dominion Securities Inc. v. Merrill ordinately refused an employer order to return to BC after
Lynch Canada Inc., 2008 SCC 54 the court implied a term a short-term period in Quebec); and Streng v. Northwest-
into the contract of an investment manager that he would ern Utility Construction Ltd., 2016 BCPC 161 at para 57.
retain investment managers under his supervision and not
17. Stein v. British Columbia Housing Management Commis-
coordinate their mass exit to join a competitor; and in
sion, 1992 CanLII 4032 (BCCA).
Bonsma v. Tesco Corporation, 2013 ABCA 367, applying the
business efficacy test, there was no reason to imply a duty 18. See discussion in Chapter 13; Mifsud v. MacMillan
on the employer to provide minimum hours of work to an Bathurst Inc., 1989 CanLII 260 (Ont. CA).
employee in a job that provides cyclical and sporadic work. 19. Bolibruck v. Niagara Health System, 2015 ONSC 1595.
8. See Rose v. Shell Canada Ltd., 1985 CanLII 675 (BCSC), 20. Ibid.; see also Marmon v. The Authentic T-Shirt
referring to a contract term implied by fact based on a Company, 2019 ONSC 205 (where the employee had been
long history of practice as a contract “term by conduct.” reassigned temporarily to different jobs with the same pay
See also Sowden v. Manulife Canada Ltd., 2015 BCSC 629. in the past, it was an implied term that the employer could
9. Elliott v. Southam Inc., 1998 CanLII 3482 (Alta. QB). do so); Gillespie v. Ontario Motor League Toronto
Club (1988), 4 ACWS (2d) 87 (Ont. H Ct J); Tymrik v.
10. See Machtinger v. HOJ Industries Ltd., [1992] 1 SCR 986 at
Viking Helicopters Ltd. (1985), 6 CCEL 225 (Ont. H Ct J);
1008.
Canadian Bechtel Ltd. v. Mollenkopf (1978), 1 CCEL 95
11. Ibid. See also TCF Ventures Corp. v. The Cambie Malone’s (Ont. CA); Dykes v. Saan Stores Ltd., 2002 MBQB 112;
Corporation, 2017 BCCA 129 at paras 19-20; and Liverpool Farber v. Royal Trust Company, [1997] 1 SCR 846; and
City Council v. Irwin, [1977] AC 239. Tanton v. Crane Canada Inc., 2000 ABQB 837.
12. Collins, supra note 1 at 34; and A. Fox, Beyond Contract: 21. RBC Dominion Securities Inc. v. Merrill Lynch Canada Inc.,
Work, Power, and Trust Relations (London: Faber, 1974) at supra note 7; Zoic Studios B.C. Inc. v. Gannon, 2015 BCCA
181-84. 334; Altam Holdings Ltd. v. Lazette, 2009 ABQB 458; and

CRC-Evans Canada Ltd. v. Pettifer, 1997 CanLII 14943 30. Pinto v. BMO Nesbitt Burns Inc., 2005 CanLII 18720 (Ont.
(Alta. QB). Sup Ct J); McKinley v. BC Tel, 2001 SCC 38; Swidrovich v.
22. Secretary of State for Employment v. ASLEF (No. 2), [1972] Saskatchewan Place Association Inc., 2019 SKQB 50; Obeng
2 All ER 949 (CA). v. Canada Safeway Ltd., 2009 BCSC 8 (employee has an
implied obligation to provide an honest and candid ex-
23. Ibid. See also S. Honeyball, Employment Law, 12th ed
planation for his actions as part of an investigation into
(Oxford: Oxford University Press, 2012) at 63-64.
misconduct); and Bhasin v. Hrynew, 2014 SCC 71 (recog-
24. CRC-Evans Canada Ltd. v. Pettifer, supra note 21. nizing a general implied duty in Canadian contracts to
25. See RBC Dominion Securities Inc. v. Merrill Lynch Canada, perform with honesty and in good faith).
2003 BCSC 1773; rev’d on other grounds, supra note 7. 31. Atlas Janitorial Services Co. v. Germanis, supra note 26.
See also Gill v. A & D Precision Ltd., 2010 ONSC 4646;
32. Carroll v. Emco Corporation, 2007 BCCA 186. The courts
Tree Savers International Ltd. v. Savoy, 1992 CanLII 2828
have not usually required employees to disclose miscon-
(Alta. CA); and Consbec Inc. v. Walker, 2016 BCCA 114
duct by other employees; see Tyrrell v. Alltrans Express
(the damages suffered due to the employee’s failure to give
Ltd., 1976 CanLII 1181 (BCSC); Bhasin v. Best Buy Canada
notice were offset by savings to the employer in not having
Ltd., 2005 CanLII 45965 (Ont. Sup Ct J); and Bell v. Com-
to pay the employee’s wages during the notice period).
puter Science Corp, 2007 ONCA 466.
26. RBC Dominion Securities Inc. v. Merrill Lynch Canada Inc.,
33. R v. Arthurs, Ex p. Port Arthur Shipbuilding Co., 1967
supra note 7 at para 38; Hivac, Ltd. v. Park Royal Scientific
CanLII 30 (Ont. CA): “If an employee has been guilty of
Instruments, [1946] 1 All ER 350, c. 169; Imperial Sheet
serious misconduct, habitual neglect of duty, incompetence,
Metal Ltd. v. Landry and Gray Metal Products Inc., 2007
or conduct incompatible with the duties, or prejudicial to
NBCA 51; McMahon v. TCG International Inc., 2007 BCSC
the employer’s business, or if he has been guilty of wilful
1003; Restauronics Services Ltd. v. Nicolas, 2004 BCCA 130
disobedience to the employer’s orders in a matter of sub-
(making plans to compete against the employer after the
stance, the law recognizes the employer’s right summarily
employment ends is not a breach of the duty of fidelity);
to dismiss the delinquent employee.” See also Bridgewater
Cariboo Press (1969) Ltd. v. O’Connor, 1996 CanLII 1553
v. Leon’s Manufacturing Co. Ltd., 1984 CanLII 2492 (Sask.
(BC CA); Amber Size & Chemical Co., Ltd., v. Menzel,
QB); Burden v. Bank of Nova Scotia, 1997 CanLII 2125
[1913] 2 Ch. 239; Rupert v. Greater Victoria School District
(BCSC); Murrell v. Simon Fraser University, 1997 CanLII
No. 61, 2003 BCCA 706; Tree Savers International Ltd. v.
2785 (BCCA); and Brown v. Sears Ltd., 1988 CanLII 153
Savoy, supra note 25; Atlas Janitorial Services v. Germanis,
(NSSC). See also the discussion in Honeyball, supra note
1994 CanLII 7522 (Ont. Sup Ct J); and Altam Holdings Ltd.
23 at 67.
v. Lazette, supra note 21.
34. Anstey v. Canadian National Railway Co., [1980] 74 APR
27. RBC Dominion Securities v. Merrill Lynch Canada, supra
95 (Nfld. CA); and Rose v. Marystown Shipyard Ltd., 1985
note 7 at para 18.
CanLII 1829 (Nfld. CA). See also Dziecielski v. Lighting
28. Ibid. Partridge v. Botony Dental Corporation, 2015 ONSC Dimensions Inc., 2012 ONSC 1877 (drinking and driving is
343; Quantum Management Services Ltd. v. Hann, 1992 also a violation of an implied term of the employment
CanLII 7720 (Ont. CA); Cinema Internet Networks Inc. v. contract).
Porter et al., 2006 BCSC 1843; Lac Minerals Ltd. v. Inter-
35. Examples of cases in which intoxication is not grounds for
national Corona Resources Ltd., [1989] 2 SCR 574; Zoic
summary dismissal including the following: Wiebe v.
Studios BC Inc. v. Gannon, 2012 BCSC 1322; and Barton
Central Transport Refrigeration (Man.) Ltd., 1994 CanLII
Insurance Brokers v. Irwin, 1999 BCCA 73. Sometimes
6406 (Man. CA); Ditchburn v. Landis & Gyr Powers Ltd.,
courts refer to an implied “duty of confidence” that
1997 CanLII 1500 (Ont. CA); and Patzner v. Piller Sausages
requires employees to protect an employer’s confidential
& Delicatessens Ltd., [1990] 19 ACWS (3d) 536 (Ont. DC).
information and not to use that information to harm the
Cases in which intoxication caused performance problems
employer’s economic interests. See discussion on “Intellec-
include the following: MacDonald v. Azar, 1947 CanLII
tual Property and Work” and other additional online
312 (NSSC) (intoxication led to poor performance); and
content discussed on page xxiii in the preface of this book;
Cox v. Canadian National Railway Company (1988), 84
and see Corona Packaging Inc. v. Singh, 2012 ONSC 2746.
NSR (2d) 271 (SC).
29. Pereira v. The Business Depot Ltd., 2011 BCCA 361;
36. See, e.g., Bannister v. General Motors of Canada Ltd., 1998
Fleming v. J.F. Goode & Sons Stationers & Office Sup-
CanLII 7151 (Ont. CA); Foerderer v. Nova Chemicals Cor-
plies Ltd., 1994 CanLII 4361 (NSSC); Riley v. Crown Trust
poration, 2007 ABQB 349; Fleming v. Ricoh Canada Inc.,
Co. (1977), 5 AR 1 (QB); and S.S. v. Huang & Danczkay
2003 CanLII 2435 (Ont. Sup Ct J); and Clarke v. Syncrude
Property Management Inc., 1999 CanLII 14865 (Ont.
Canada Ltd., 2013 ABQB 252.
Sup Ct J).

37. Simpson v. Consumers’ Assn. of Canada, 2001 CanLII 47. McCamus, supra note 6 at 783-84.
23994 (Ont. CA); and Gonsalves v. Catholic Church Exten- 48. On temporary layoffs, see McLean v. The Raywal
sion Society of Canada, 1998 CanLII 7152 (Ont. CA). Limited Partnership, 2011 ONSC 7330; Davies v.
38. Bannister v. General Motors of Canada, supra note 36; and Fraser Collection Services Ltd., 2008 BCSC 942; Damery
Alleyne v. Gateway Co-operative Homes Inc., 2001 CanLII v. Matchless Inc., 1996 CanLII 5518 (NSSC); Trites v.
28308 (Ont. Sup Ct J). Renin Corp, 2013 ONSC 2715; Stolze v. Addario, 1997
39. Smith v. Baker & Sons, [1891] AC 325. See also Ainslie CanLII 764 (Ont. CA); Michalski v. Cima Canada Inc.,
Mining & Railway Co. v. McDougall, [1909] 42 SCR 420; 2016 ONSC 1925; Elsegood v. Cambridge Spring
Matthews v. Kuwait Bechtel Corp., [1959] 2 QB 57; Marsh- Service (2001) Ltd., 2011 ONCA 831; Bevilacqua v.
ment v. Borgstrom, [1942] SCR 374; and Regal Oil & Refin- Gracious Living Corporation, 2016 ONSC 4127;
ing Co. et al. v. Campbell (1937), 2 DLR 609. See also the Collins v. Jim Pattison Industries Ltd., 1995 CanLII 919
discussion in E. Tucker, “The Law of Employer’s Liability (BCSC); Rodger v. Falcon Machinery (1965) Ltd., 2006
in Ontario 1861 – 1900: The Search for a Theory” (1984) 22 MBQB 216; and Vrana v. Procor Ltd., 2003 ABQB 98. On
Osgoode Hall LJ 213. unpaid suspensions, see Carscallen v. FRI Corp., 2006
CanLII 31723 (Ont. CA); Henderson v. Saan Stores Ltd.,
40. See Doorey, supra note 14.
2005 SKQB 34; and Hanley v. Pease & Partners, [1915]
41. In 1909, the Saskatchewan Court of Appeal ruled 1 KB 698 (Div Ct).
that employees are entitled to “decent treatment at the
49. See, e.g., Michalski v. Cima Canada Inc., supra note 48
hands of the Master”: Berg v. Cowie, 1918 CanLII 319
(“The right to impose a layoff as an implied term must be
(Sask. CA). In a 1974 British decision called Wilson v.
notorious, even obvious, from the facts of a particular
Racher, supra note 13, Edmund-Davies LJ said that a
situation”).
“contract of service imposes upon the parties a duty of
mutual respect.” 50. Damery v. Matchless Inc., supra note 48; and Rodger v.
Falcon Machinery, supra note 48.
42. Sweeting v. Mok, 2015 ONSC 4154; Morgan v. Chukal
Enterprises, 2000 BCSC 1163; Saunders v. Chateau Des 51. Martellacci v. CFC/INX Ltd., 1997 CanLII 12327 (Ont. SC)
Charmes Wines Ltd., 2002 CanLII 5114 (Ont. Sup Ct J); at para 29: “It is difficult to imagine a more fundamental
Stamos v. Annuity Research & Marketing Service Ltd., 2002 term of employment than that the employee be paid his or
CanLII 49618 (Ont. Sup Ct J); and Ulmer Chevrolet her salary.”
Oldsmobile Cadillac Ltd. v. Kowerchuk, 2005 SKPC 18. See 52. Carscallen v. FRI Corp., supra note 48.
also Lamb v. Gibbs Gage Architects, 2011 ABPC 315; and 53. See the discussion of quantum meruit in the employment
Colistro v. Tbaytel, 2019 ONCA 197 at para 50 (noting the context in Maver v. Greenheat Energy Corporation, 2012
term could be applied to the employer’s decision to rehire BCSC 1139; O’Neill v. Rentokil Canada, 2000 BCSC 1520;
an employee who years before had sexually harassed Odo v. Island Publishers Ltd., 2000 BCSC 499; and O’Brien
co-workers). v. Buffalo Narrows Airways, 1998 CanLII 13764 (Sask. QB).
43. Hanni v. Western Road Rail Systems (1991) Inc., 2002 54. Honda Canada Inc. v. Keays, 2008 SCC 39; Wallace v.
BCSC 402. United Grain Growers Ltd., [1997] 3 SCR 701. See discus-
44. Vandooyeweert v. Jensten Foods Ltd., 2002 BCPC 442. sion and further cases in Chapter 14.
45. Prabhakaran v. Town of Fort Macleod, 2010 ABPC 35. 55. See Rahemtulla v. Vanfed Credit Union, 1984 CanLII 689
46. Boucher v. Wal-Mart Canada Corp., 2014 ONCA 419. See (BCSC) at para 22.
also Potter v. New Brunswick Legal Aid Services Commis- 56. See Teskey v. Great West Life Assurance Co., 2001 ABQB 1060.
sion, 2015 SCC 10, in which the Supreme Court of Canada 57. Some examples include Rahemtulla v. Vanfed Credit Union,
recognized and developed an implied contractual obliga- supra note 55; Ellison v. Burnaby Hospital Society, 1992
tion to perform the contract with honesty and in good CanLII 391 (BCSC); Starcevich v. Woodward’s Ltd., 1991
faith; and Bhasin v. Hrynew, supra note 30 (the court rec- CanLII 330 (BCSC); Taylor v. Canada Safeway Ltd., 1998
ognized an “overriding principle,” not an implied term, CanLII 1472 (BCSC); McLaren v. Pacific Coast Savings
that contracts will be performed in good faith and with Credit Union, 2001 BCCA 388; McLean v. The Raywal
honesty. Since this is not an implied term, the parties Limited Partnership, supra note 48; Corey v. Dell Chemists
cannot contract out of it). See also Karmel v. Calgary (1975) Ltd., 2006 CanLII 19435 (Ont. Sup Ct J); and
Jewish Academy, 2015 ABQB 731; and D. Doorey, “Court Cheong v. Grand Pacific Travel & Trade (Canada) Corp.,
of Appeal Confirms an Implied Obligation of Good Faith 2016 BCSC 1321.
and Fair Dealing in Employment Contracts,” online, Law
58. See also Wiebe v. Central Transport Refrigeration (Man.)
of Work (blog): <http://lawofwork.ca/?p=7487>.
Ltd., supra note 35 at para 29; Starcevich v. Woodward’s

Ltd., supra note 57; Ellison v. Burnaby Hospital Society, Columbia, 2018 BCSC 1993; Cheong v. Grand Pacific Travel
supra note 57; Cheong v. Grand Pacific Travel & Trade & Trade (Canada) Corp., supra note 57; McLean v.
(Canada) Corp., supra note 57. The Raywal Limited Partnership, supra note 48; and
59. Rahemtulla v. Vanfed Credit Union, supra note 55 at para Kohler Canada Co. v. Porter, 2002 CanLII 49614
20. See also Fernandez v. The University of British (Ont. Sup Ct J).

C H A P T E R 10
Termination by an Employer
with “Reasonable Notice”
II. Employee Vulnerability and the Rules Governing Termination of
• Explain the development of the implied obligation on employers Employment Contracts 155
to provide employees with “reasonable notice” before terminating III. A Brief History of the Origins of Implied Reasonable Notice 156
the employment contract. IV. How Modern Canadian Courts Assess an Employer’s Duty to Provide
• Recognize the difference between the default model of Reasonable Notice of Termination 158
termination of employment contracts in Canada and the United A. The “Bardal Factors” 159
States. B. Summary of the Bardal Factors 160
• Identify and explain the factors that judges consider in assessing C. Other Factors Affecting the Length of Reasonable Notice 165
how much notice is “reasonable.” IV. Chapter Summary 166
• Recognize how changes in the economic and market subsystem Questions and Issues for Discussion 166
can influence how judges assess reasonable notice. Exercise 167
I. Introduction
Every employment contract must come to an end. In most cases, the termination of the contract
gives rise to no legal disputes. For one reason or another, the parties decide to part ways, and the
split is amicable. Maybe the employer even writes a nice reference letter to help the employee
find a new job. Sometimes the employee retires, and there is a cake.
However, most work-related disputes that reach the courts deal with issues arising from the
termination of contracts. Over the next several chapters, we will explore how the common law
regime deals with disputes about the termination of employment contracts. The end of the con-
tract can come about in a variety of ways, as depicted in Figure 10.1, each of which can give rise
to potential legal issues. In Chapter 8 we considered how the parties to an employment contract
can define the conditions under which the contract terminates in expressed contract language,
and how even then disagreements can arise that lead to lawsuits. In this chapter, we will consider
the relatively common situation in which an employer terminates an employment contract by
providing the employee with “reasonable notice” of termination.
In the common law regime, an employer is presumed to have the right to terminate an
employment contract at any time by giving the employee notice of the termination. There are
exceptions, some of which we have considered already (fixed-term/fixed-task contracts) and
some we will learn later (summary dismissal for cause in Chapter 12). However, most of the time
employers terminate employment contracts by providing the employee with notice of that ter-
mination. As noted previously, notice can be working notice (the employee just keeps working
until the notice period is over) or pay “in lieu of notice” (the employee goes home and the em-
ployer pays the employee what they would have earned had they kept working).
153

FIGURE 10.1 Methods of Terminating Employee Contracts

How the Means of Common Legal
Contract Ends Termination Issues
Agreement of the Fixed-term or fixed-task contract clause. • Is the clause clear and unambiguous?
parties in an Notice of termination clause. • Does the clause violate a statute?
expressed contract Retirement clause. • Is the contract term “unconscionable,” or
term does the changed substratum doctrine
(Chapter 8) apply?
Frustration of An unforeseen event makes • Do circumstances fall within the

contract performance of the contract impossible. doctrine of “frustration”?
(Chapter 11)
Employer terminates The employer provides working Wrongful dismissal:

with “reasonable “reasonable notice” of termination or • Did the employer provide enough
notice” “pay in lieu of that notice.” notice?
(Chapter 10) • How much notice is “reasonable notice”?
Summary dismissal: The employer alleges the employee Summary dismissal:

employer terminates repudiated the contract, and so • Did the employee breach the contract
for cause dismisses the employee with no notice. and if so was the misconduct serious
(Chapter 12) enough to constitute repudiation of the
contract?
Constructive The employee alleges that the employer • Did the employer repudiate the
dismissal repudiated the contract, and so quits contract? If so, how much notice was
(Chapter 13) and claims damages for loss of required?
entitlement to notice of termination.
Resignations: The employee terminates the • Did the employee really quit?
Employee terminates employment contract. • How much notice is required?
with notice
(Chapter 15)
The main legal question that arises is how much notice is required. The contract might pro-
vide the answer, as discussed in Chapter 8, in the form of a notice of termination clause, so we
should always start by looking at the written contract if one exists. Provided that clause is un-
ambiguous, does not run afoul of employment standards statutes, and is not unconscionable
(see Chapter 8), the courts will enforce that clause. However, many employment contracts
include no notice of termination clause, or they include a notice clause that is ruled to be unlaw-
ful by the courts for reasons discussed in Chapter 8. In these cases, the courts imply a term
requiring “reasonable notice” of termination of the employment contract, as we learned in
Chapter 9. This chapter examines how the courts determine what constitutes reasonable notice.

Chapter 10 Termination by an Employer with “Reasonable Notice” 155
The question of whether an employer provided an employee with reasonable notice of termin-
ation is probably the most litigated issue in the common law of the employment contract.
II. Employee Vulnerability and the Rules Governing Termination of

Let’s begin our discussion with some brief but important observations about how concerns over
employee vulnerability have influenced the approach of the courts to the termination of employ-
ment contracts. The legal rules that apply to the termination of employment contracts are
derived from the rules of contract law more generally. Therefore, contract law concepts (such as
repudiation of contract) are important, and we will need to learn about them. However, judges
have also applied contract law concepts with an eye on the special nature of the employment
relationship. A contract for human labour is not the same as a contract for renting or supplying
goods, judges have stated, because work is so central to our sense of personal worth and identity.
Moreover, workers are often in a position of vulnerability, both at the time the labour contract
is initially created and particularly at the time when the contract is terminated.
Box 10.1 describes important examples of how the Supreme Court of Canada has incorpor-
ated concerns over employee vulnerability in the work relationship into the exercise of interpret-
ing employment contracts.1 The point is not that normal contract law principles are cast aside
in employment contract disputes. It is subtler than that. Judges are mindful that, as the more
powerful party, employers write most employment contracts, that little negotiation takes place
when contracts are created, and that significant economic and social costs are often associated
with job loss. This reality sometimes serves as a backdrop when judges are asked to assess
whether an employment contract was terminated properly. Judges’ concern about protecting
vulnerable employees, particularly in recent decades, has occasionally influenced judicial rea-
soning and outcomes, no more so than in their interpretations of contractual rules governing
the termination of employment contracts.

The Supreme Court of Canada and Employee Vulnerability Under Employment Contracts
Comments by Supreme Court of Canada judges have had great Re Public Service Employee Relations Act (Alta.), [1987]
influence on the development of the law of employment 1 S.C.R. 313 …:
contracts. In a series of decisions over the past 30 years, the Work is one of the most fundamental aspects in
Supreme Court has emphasized the need for the common law a person’s life, providing the individual with a means
of employment contracts to develop with consideration of the of financial support and, as importantly, a contribu-
inherent vulnerability of employees. This outlook is perhaps tory role in society. A person’s employment is an
most evident in cases relating to termination of the employ- essential component of his or her sense of identity,
ment contract. self-worth and emotional well-being.
For example, in Machtinger v. HOJ Industries Ltd. (see Box I would add that not only is work fundamental
8.6), the court referred to the “policy considerations” that ought to an individual’s identity, but also that the manner
to influence judges when interpreting employment contracts in which employment can be terminated is equally
and made the following (now often-cited) observations: important.*
[E]mployment is of central importance to our soci- Referring to the purpose of the Employment Standards Act,
ety. As [Chief Justice] Dickson … noted in Reference the Supreme Court in Machtinger also wrote:

The harm which the Act seeks to remedy is that in- power. In its inception it is an act of submission, in
dividual employees, and in particular non-unionized its operation it is a condition of subordination.‡
employees, are often in an unequal bargaining pos-
The court then noted the following:
ition in relation to their employers. As stated by
[Professor] Swinton …: The point at which the employment relationship
ruptures is the time when the employee is most
[T]he terms of the employment contract rarely
vulnerable and hence most in need of protection. In
result from an exercise of free bargaining power
recognition of this need, the law ought to encourage
in the way that the paradigm commercial ex-
conduct that minimizes the damage and dislocation
change between two traders does. Individual
(both economic and personal) that result from
employees on the whole lack both the bargain-
dismissal.§
ing power and the information necessary to
achieve more favourable contract provisions As we work through the next several chapters that explore
than those offered by the employer, particularly termination of employment contracts, notice how judges’
with regard to tenure.† concern for employee vulnerability has shaped how the com-
mon law deals with termination of the employment
In Wallace v. United Grain Growers Ltd., decided five years
contract.
after Machtinger, the Supreme Court again emphasized the
inequality of bargaining power that defines employment
* Machtinger v. HOJ Industries Ltd., [1992] 1 SCR 986 at 1002. See also
contracts, citing with approval the following often-quoted Potter v. New Brunswick Legal Aid Services Commission, 2015 SCC 10 at
passage from Oxford law professors Paul Davies and Mark para 83.
Freedland, Kahn-Freund’s Labour and the Law: † Ibid. at 1003.
[T]he relation between an employer and an isolated ‡ Wallace v. United Grain Growers Ltd., [1997] 3 SCR 701 at para 92.
employee or worker is typically a relation between § Ibid. at para 95.
a bearer of power and one who is not a bearer of
III. A Brief History of the Origins of Implied Reasonable Notice

By the early 1890s, British judges had adopted the presumption that employment contracts were
for an indefinite period, unless otherwise indicated in the contract or a statute.2 This replaced
an earlier presumption that employment contracts were for a one-year fixed term, unless other-
wise indicated. The 1911 edition of the leading British legal text Halsbury’s Laws of England
summarized the state of employment law as follows: “If no custom nor stipulation as to notice
exists, and if the contract of service is not one which can be regarded as a yearly hiring, the ser-
vice is terminable by reasonable notice.”3
Canada inherited the British common law of the employment contract, but there was little
“employment” and few employment contract lawsuits prior to the 1900s (see Chapter 5). Canada
was a vast, underpopulated country with many opportunities for property ownership. When
people performed work for others, they tended to do so only long enough to amass sufficient
funds to purchase their own land. Although few employment contract lawsuits existed at the
time, in 1898 the Supreme Court of Canada clarified that the presumption of annual hire (i.e., a
contract duration of one year) did not exist in Canadian employment contracts, and that the
matter of contract length was a factual issue to be decided based on the evidence in each case.4
In the 1908 decision Speakman v. City of Calgary, an Alberta judge ruled that an employee
was entitled to reasonable notice of termination, and that the amount of notice depended on a
variety of factors, including the employee’s “class” and “general standing in the community,” and
“the probable facility or difficulty the employee would have in procuring other employment.”5
This reference to the “class” of employee may seem dated, but the idea that “lower classes” of
workers deserve a lesser period of reasonable notice has played an important role in the develop-
ment of the law in this area to modern times. So too has an assessment of the “difficulty the
employee would have in procuring other employment,” as we will discuss shortly.

By the 1920s, the presumption that employment contracts were of indefinite duration and
could be terminated by reasonable notice had taken root in Canada. This approach was con-
firmed in the 1936 decision Carter v. Bell, where the Ontario Court of Appeal ruled that “there
is implied in the contract of hiring an obligation to give reasonable notice of an intention to
terminate the arrangement.”6 It is important to emphasize again that the implied requirement to
give reasonable notice only exists if the parties have not otherwise agreed to a different, lawful
notice formula.

The Divergent Approaches of Canada and the United States: “Reasonable Notice” Versus the
“At Will” Employment Contract
An enduring mystery in comparative employment law is why least not completely accurate, in his description of the law as
Canada and the United States went in such diametrically op- it existed in the late 1800s.† Other scholars have rejected as
posed directions on the rules surrounding the termination of “myth” the claim that the courts adopted the “at will” presump-
employment contracts. tion because of a mistaken assumption that Wood was correct.
Both countries inherited the British common law model. They argue that Wood was indeed correct, and American
Canada ultimately adopted the presumption of indefinite-term courts had always treated employment contracts as “at will.”‡
employment contracts terminable by reasonable notice that Why the courts did so is a matter of debate among these
had emerged in Britain by the late 1800s. However, American scholars. One argument is that the courts wanted to protect
courts went in a different direction and developed a presump- employers from attempts by the growing number of mid-level
tion that employment contracts have a length of one second, managers in the late 19th century to claim their contracts
terminable at any moment, with no notice required at all. This included some form of job security, either in the form of a fixed
type of contract is known as an “at will” employment duration or a notice of termination requirement.§
contract.
More than one theory exists on why
Canada and the United States have taken
such different paths. The predominant
theory espoused by American legal schol-
ars is that, until the late 1880s, American
courts were either following the British
presumption of annual hiring contracts or
making no presumption of contract dura-
tion at all and treating duration of contract
as a factual issue that turned on the facts
in each case. Then, in 1877, lawyer Horace
Wood published a book concluding that
American law followed the presumption
that employment contracts were “at will.”*
Thereafter, American judges cited Wood’s
text as the authority for the “at will” pre-
sumption, which requires no notice of
termination.
Many American scholars have since
argued that Wood was in fact wrong, or at A threshing crew takes a break from their toil on a Saskatchewan farm, 1911.
“at will” employment contract: An employment contract in which either party may terminate the contract at any time, for
any or no reason, with no notice to the other party. This is the default model in the United States. In Canada, employment stan-
dards legislation requires notice of termination and therefore prohibits at will contracts for employees covered by the legislation.

Another theory asserts that “free” workers or employers in and without any job security. Many statutory and even judge-
19th-century America made little demand for longer-term made restrictions on the rule have been developed over the
contracts or notice requirements. Due to labour shortages in years. Some scholars have argued that American law should
agriculture, most workers preferred the flexibility of being move toward the Canadian/British system of requiring no-
able to leave at any time for a higher paying job or because tice.‡‡ Others have supported the “at will” approach as being
they had earned enough to purchase their own land.** Em- best for the economy and “individual liberty.”§§
ployers were also happy not to have contractual obligations
to keep workers when there was no work. This theory does * H. Wood, A Treatise on the Law of Master and Servant Covering the
not explain why Canadian courts adopted the reasonable Relation, Duties, and Liabilities of Employers and Employees (Albany, NY:
John D. Parsons Jr., 1877) at 272: “the rule is inflexible, that a general or
notice rule under essentially the same labour market indefinite hiring is prima facie a hiring at will, and if the servant seeks to
conditions. make it out a yearly hiring, the burden is upon him to establish it by
Another theory argues that US judges adopted “at will” to proof.”
relieve the courts from having to deal with employment con- † See P. Shapiro & J. Tune, “Implied Contract Rights to Job Security” (1974)
tract cases.# “At will” simplified employment contract law, re- 26 Stan L Rev 335; S. Jacoby, “The Duration of Indefinite Employment
ducing the need for court intervention. Contracts in the United States and England: An Historical Analysis”
(1982) 5 Comp Lab LJ 85; and B. Etherington, “The Enforcement of
Finally, some scholars have argued that the British and
Harsh Termination Provisions in Personal Employment Contracts: The
Canadian courts adopted the reasonable notice rule as a Rebirth of Freedom of Contract in Ontario” (1989 – 90) 35 McGill LJ 459.
means of controlling unions. If a contract included a require-
‡ See, e.g., D. Ballam, “Exploding the Original Myth Regarding
ment for employees to provide the employer with reasonable Employment-at-Will: The True Origins of the Doctrine” (1996) 17
notice that they were quitting, then a sudden strike (walking Berkeley J Emp & Lab L 91; and J. Fienman, “The Development of the
off the job) was a breach of the contract. As a result, a notice Employment-at-Will Rule Revisited” (1991) 23 Ariz St LJ 733.
requirement gave courts the option of punishing employees § Fienman, ibid.
who struck as well as union organizers who encouraged work- ** Ballam, supra note ‡ at 128-30.
ers to strike through the tort of “inducing breach of contract,”
# A. Morriss, “Exploding Myths: An Empirical and Economic Reassessment
which we consider in Chapter 16.†† According to this theory, of the Rise of Employment at Will” (1994) 59:3 Mo L Rev 683.
American unions used the “sudden strike” weapon far less
†† Etherington, supra note † at 472-73; Jacoby, supra note † at 120-26.
frequently than British and Canadian unions and workers. As
‡‡ R. Arnow-Richman, “Mainstreaming Employment Contract Law: The
a result, little need existed for American employers and the
Common Law Case for Reasonable Notice of Termination” (2013) 66 Fla
courts to rely on notice provisions in contracts as a weapon L Rev 1513.
to restrain the burgeoning labour movement.
§§ R. Epstein, “In Defense of the Contract at Will” (1984) 51 U Chicago L Rev
The “at will” rule in the United States has been subject to 947.
constant criticism over the years for leaving workers vulnerable
IV. How Modern Canadian Courts Assess an Employer’s Duty to

Provide Reasonable Notice of Termination
A lawsuit by an employee alleging that an employer terminated an employment contract without
providing the employee with reasonable notice is known as a wrongful dismissal lawsuit. How
much notice is “reasonable,” and on what basis do judges make that decision? One option is to
imagine what the parties themselves would have thought was reasonable, had they considered
the issue, when they were making the contract. This approach was taken in the 1961 case of
Lazarowicz v. Orenda Engines Ltd., in which the Ontario Court of Appeal stated:
Opinions might differ as to what was reasonable, but in reaching an opinion a reasonable test would
be to propound the question, namely, if the employer and the employee at the time of the hiring had
addressed themselves to the question as to the notice that the employer would give in the event of
him terminating the employment, or the notice that the employee would give on quitting, what
would their respective answers have been?7

The court of appeal is saying here that the requirement to provide reasonable notice is a
contract term implied “in fact” (see Chapter 9). On this approach, judges must (metaphorically)
hop in a time machine and go back to the time of the formation of the contract to ask what the
parties would have agreed to had they bothered to write down a term explaining how much
notice should be given to the other party in the event of a termination of the contract.8 Judges
still sometimes refer to the supposed intentions of the parties when they determine the amount
of reasonable notice.9
A. The “Bardal Factors”

However, the approach in Lazarowicz raises the obvious question: How does the judge know
what the parties would have agreed to back when they bargained the contract? In most cases, as
we have discussed before, the employer would probably draft a notice of termination clause that
suits its own interests, and the employee would simply sign on the dotted line. Therefore, a judge
might reasonably conclude that if the parties had bothered to write a notice term down, they
would have written one requiring no notice at all—like an American “at will” contract—or at
least very little notice.
Although that outcome is fine from a purely contract law perspective, it would also leave
employees with little or no opportunity to plan for the end of the contract by starting to look for
new work. Most Canadian judges have preferred to approach the calculation of reasonable
notice from a policy perspective, seeking to balance the interest of employers in workplace flex-
ibility and employees’ interest in having a “cushion” to plan for the transition between jobs.10
That approach has been captured by the application of the Bardal factors.
Bardal v. Globe & Mail Ltd. described the factors judges are to consider in calculating reason-
able notice. Justice McRuer ruled that in assessing how much notice is “reasonable,” judges
should use their judgment, keeping in mind a number of key criteria, which are presented in
Box 10.3. Although the Bardal decision was issued by a lower level of court than Lazarowicz, the
Bardal approach was later approved by appellant courts, and it has become the leading Canadian
authority in guiding judges on the assessment of reasonable notice.11

Factors to Consider in Assessing Reasonable Notice
Bardal v. Globe & Mail Ltd. position, and other factors. Here is the passage from that de-
1960 CanLII 294 (Ont. Sup Ct J) cision, which is now cited in most Canadian cases in which the
length of reasonable notice is being assessed:
Key Facts: Bardal was an advertising manager with 16.5 years
of service when his contract was terminated. His employment There can be no catalogue laid down as to what is
contract was silent (it said nothing) about how much notice reasonable notice in particular classes of cases. The
was required to terminate the contract. reasonableness of the notice must be decided with
Issue: How much notice of termination was the employer reference to each particular case, having regard to the
obligated to provide Bardal? character of the employment, the length of service of
the servant, the age of the servant and the availability
Decision: The court ruled that one year was “reasonable no- of similar employment, having regard to the experi-
tice” considering how long Bardal had been employed, his ence, training and qualifications of the servant.
Bardal factors: Criteria considered by Canadian courts in assessing the length of time required by the implied obligation to
provide “reasonable notice” of termination of an employment contract. The name comes from the leading decision called Bardal
v. Globe and Mail Ltd., decided in 1960.

The Bardal approach makes no mention of the “intention of the parties.” Factors such as
“availability of similar employment” and “length of service” are not even known at the time the
parties are negotiating the contract.12 The Bardal factors require judges to survey the situation
at the time of the termination and to calculate a reasonable period of notice based on what they
see and think is fair and reasonable in the circumstances, considering a list of factors.13 The
Ontario Court of Appeal has described the process of determining reasonable notice as “an art
not a science” and therefore “there is no one ‘right’ figure for reasonable notice. Instead, most
cases yield a range of reasonableness.”14
B. Summary of the Bardal Factors

The purpose of requiring employers to provide the employee with reasonable notice is to give
the employee an opportunity to prepare for job loss and to seek new employment.15 Therefore,
the factors listed in the Bardal decision are intended to act as a proxy for assessing how long it
might reasonably take the dismissed employee to find comparable alternative employment con-
sidering the employee’s circumstances. Reasonable notice assigns part of the social and eco-
nomic costs of unemployment to employers, hopefully reducing the extent to which dismissed
workers need to draw on public assistance schemes like Employment Insurance and welfare.
This does not mean that the period of notice will match the precise time it actually takes the
employee to find a new job. Rather, judges are supposed to consider the factors listed in Bardal
and then decide “what appears to be logical, judicious, fair, equitable, sensible, and not exces-
sive,” according to the judge.16 Table 10.1 provides a quick, cross-country sample of some recent
wrongful dismissal lawsuits and the amounts of reasonable notice ordered. There is also an
exercise at the end of the chapter that allows you to estimate reasonable notice periods.
TABLE 10.1 Recent Examples of Reasonable Notice Periods Order in Canada

Case Name Details Reasonable Notice Ordered
Saikaly v. Akman Construction Ltd., Office manager, 12 years’ service, 24 months
2019 ONSC 799 age 60
Spalti v. MDA Systems Ltd., 2018 Sales executive, 13.5 years’ ser- 16 months
BCSC 2296 vice, age 55
Coppola v. Capital Pontiac Buick Account manager, 23 months’ 6 months
Cadillac GMC Ltd., 2011 SKQB 318 service, age 38
Bohnet v. Rebel Energy Services Ltd., Manager, rentals division, 3.5 4 months
2018 ABPC 131 years’ service, age 47
Salkeld v. 7-Eleven Canada, Inc., Sales clerk, 27 years’ service, age 14 months
2010 MBQB 157 50
Welch v. Ricoh Canada Inc., 2017 Service technician, 25 years’ 18 months
NSSC 174 service, age 47
MacKinnon v. Helpline Inc., 2015 Manager/coordinator, 16 years’ 18 months
NBQB 159 service, age 51
1. Length of Service

The most important factor in assessing the length of reasonable notice is the employee’s length
of service.17 The longer an employee’s service with an employer, the longer the period of reason-
able notice required to terminate the employment contract. One judge explained that “a long-
term employee has a moral claim which has matured into a legal entitlement to a longer notice

period.”18 In practice, Canadian courts have imposed a “soft cap” on reasonable notice of a
maximum of 20 to 24 months, and only in exceptional cases involving very long-service employ-
ees do courts order greater than 24 months’ notice.19 The majority of awards are for 12 months’
notice or less.
Some judges have tried to simplify the exercise of assessing notice periods by applying a
general “rule of thumb” approach based on one month’s notice for each year of employment, and
then adjusting upward or downward if special factual circumstances are involved.20 However,
appellant courts have rejected that approach for the reason presented in the 1999 Ontario Court
of Appeal case of Minott v. O’Shanter Development Company Ltd.: “a rule of thumb that an em-
ployee is entitled to one month’s notice for every year worked should not be applied. To do so
would undermine the flexibility that must be used in determining the appropriate notice
period.”21 Employment lawyer Barry Fisher examined hundreds of Canadian reasonable notice
cases and found evidence of the “rule of thumb” measure for employees dismissed within their
first three years of employment, but little evidence of that pattern for employees with longer
service.22
2. Age of the Employee

The courts have noted that middle-aged and older workers often have a more difficult time find-
ing alternative employment than younger workers.23 This observation appears to be reflected in
reasonable notice awards. In a study of reasonable notice periods ordered by courts of appeal,
Professor Kenneth Thornicroft (University of Victoria) found that the age of the employee is
significant for employees over the age of 50, but not as important for employees younger than
50.24 He found that employees over age 50 received an additional three months’ notice.
3. Character of the Employment

Managerial workers have traditionally been granted longer periods of notice than non-
managerial workers. This distinction dates back to the British class system, in which the courts
assumed that higher-ranking members of society deserve greater employment contract protec-
tions. Recall the words of the Alberta court in the 1908 Speakman case, cited above, about the
length of notice being affected by the employee’s “class” and “general standing in the com-
munity.” In modern times, the distinction between managerial and non-managerial employees
has been justified on the theory that managerial employees will have a harder time finding simi-
lar alternative employment than will lower‑level employees.25 This presumption took the form
of a court-created soft cap on reasonable notice periods whereby non-managerial employees
would usually not be entitled to a reasonable notice period longer than 12 months, whereas
managerial employees could receive up to 24 months.
However, in recent years this distinction has been questioned. The leading case that affirmed
the practice of treating managerial and non-managerial employees differently is the 1995
Ontario Court of Appeal case of Cronk v. Canadian General Insurance Co.26 Cronk was a
55-year-old clerk who was dismissed after more than 29 years’ service. She argued that the
period of reasonable notice should be 20 months, far more than the usual cap of 12 months
applied by the courts for non-managerial employees. The lower court judge (Justice James
MacPherson) concluded that it could not be assumed that non-managerial employees would
always have an easier time finding alternative employment. He believed that Cronk would have
a difficult time finding another job given her age and lack of transferrable skills. He ordered 20
months’ reasonable notice.27
The employer appealed, and the Ontario Court of Appeal overruled Justice MacPherson. It
reaffirmed the “established principle that clerical employees are generally entitled to a shorter
notice period than senior management or specialized employees who occupy a high rank in the

organization.”28 The court of appeal ruled that it would be too disruptive to employers to change
the presumption that non-managerial workers receive less notice:
The result arrived at [by Justice MacPherson] has the potential of 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,
legal practitioners specializing in employment law and the legal profession generally have to give
advice to employers and employees in respect of termination of employment with reasonable
certainty.29
The court of appeal ruled that Cronk was entitled to 12 months’ notice, the maximum
amount of notice “in her category.”
However, a few years later, cracks again began to appear in the distinction. In the case of
Minott v. O’Shanter Development Company Ltd., the Ontario Court of Appeal awarded a non-
managerial maintenance worker 13 months’ reasonable notice.30 That employee had only 11
years’ service, compared with Cronk’s 29 years. In explaining the different outcomes, the court
of appeal stated that Cronk dealt only with clerical workers and did not establish an upper limit
for all non-managerial employees. The court of appeal also questioned whether having a cap for
non-managerial workers “detracts from the flexibility of the Bardal test and restricts the ability
of courts to take account of all factors relevant to each case and of changing social and economic
conditions.”
Finally, the issue came before the Ontario Court of Appeal again in the 2011 case of Di
Tomaso v. Crown Metal Packaging Canada LP, which is discussed in Box 10.4. Justice
MacPherson, now sitting on the court of appeal, wrote the decision.

Should Managerial Employees Get More Reasonable Notice Than Non-Managerial Employees?
Di Tomaso v. Crown Metal Packaging Canada LP Decision: No. No automatic cap exists on reasonable notice
2011 ONCA 469 damages for non-managerial employees. Justice MacPherson
cited Minott as authority for this conclusion. He then repeated
Key Facts: Di Tomaso had worked 33 years as a non-managerial what he stated in his original Cronk ruling: that there is no
mechanic for Crown Metal Packaging Canada LP and was 62 logical reason why the courts should assume that “unskilled
years old at the time of his dismissal. The lower court judge employees deserve less notice because they have an easier
awarded him 22 months’ notice. The employer appealed and time finding alternative employment. The empirical validity
argued that as a non-managerial employee, Di Tomaso was of that proposition cannot simply be taken for granted.” Each
only entitled to a maximum of 12 months’ notice, as per the case must be assessed on its own with consideration of the
ruling in the Cronk case. (In a funny twist, Justice James facts and without reliance on presumptions about whether
MacPherson was by this time sitting on the court of appeal managerial employees will have a harder time finding alterna-
and wrote the decision for the court in Di Tomaso.) tive employment.
Issue: Should the amount of reasonable notice be capped at The court of appeal upheld the lower court decision to
12 months for a non-managerial employee? award 22 months’ notice to Di Tomaso.
In the Di Tomaso decision, the court of appeal noted that the “character of employment” was
of “declining relative importance” in assessing reasonable notice in Canada. Judges in Ontario
are no longer to assume that non-managerial employees will automatically get new jobs quicker
as a justification for awarding lesser reasonable notice periods, as recently confirmed by the
Ontario Court of Appeal in a case called Oudin v. Le Centre Francophone de Toronto:

The parties exerted a significant amount of energy disputing the true nature of the plaintiff ’s employ-
ment and the precise degree to which he could be characterized as “managerial.” It would appear that
there remains a suspicion among some that higher-level employees automatically receive greater
notice periods than lower level employees. That suspicion is misplaced. Some highly placed managers
are highly marketable and can reasonably expect to be placed quite quickly while some unskilled
workers may find unemployment uncomfortably long if they find themselves in a community with
few options. Character of employment is a factor, but is only one of several factors and there is no
presumption that lower level employees necessarily have an easier time seeking re-employment than
higher level employees.31
Since the Di Tomaso decision, courts have been more inclined to award periods of notice
longer than 12 months to non-managerial employees, particularly in Ontario but in other prov-
inces as well.32 While in theory the approach adopted in Di Tomaso could also lead courts to
order lower notice awards for managerial employees, there is little evidence that this is happen-
ing (at least so far).

The Law of Work Framework: Gender and Reasonable Notice
Is it a coincidence that the clerical employee in Cronk was a was 55 years old when she was fired. But after long
woman, and the employees in both the Di Tomaso and Minott years of clerical work at a very modest salary, it is
decisions were men? The employee’s gender is not listed as a almost certain that she was not able to contemplate
factor in Bardal, and judges rarely list the employee’s gender the Freedom 55 Mustang convertible and surfboard.
as a relevant factor in assessing the length of reasonable no- She needs another job.†
tice. However, in a recent study, Professor Thornicroft found
that women receive smaller reasonable notice awards: Justice MacPherson’s comments and his decision in the
Cronk case demonstrate how a judge can be influenced by
Although an employee’s gender should not be a developments and changing attitudes within the broader
relevant factor in assessing reasonable notice, I social, cultural, and religious subsystem, introduced in Chapter
found a negative correlation between female gen- 2. Justice MacPherson recognized that women play a greater
der and size of award. Female plaintiffs constituted role than men in Canadian society in caring for family and that
slightly more than 20% (26 individuals) of the em- this commitment is reflected in women’s labour market ex-
ployees in my study, and the results suggest that periences. This understanding was the basis for his rejection
female employees received about 1.5 to 1.7 months’ of the historical assumption that a woman in a non-professional
less notice than comparable male employees.* job will more easily find new employment than a man in a
managerial position. Justice MacPherson’s ruling in Cronk was
In the lower court decision in the Cronk case (considered overruled by the Ontario Court of Appeal in 1995, but in the
above), Justice MacPherson ordered 20 months’ notice for a 2011 case of Di Tomaso (see Box 10.4) the same court appears
56-year-old female clerk. In his reasons, he noted that women to have been persuaded by Justice MacPherson’s perspective.
have a more difficult time finding employment than men as In wrongful dismissal cases, it is now relevant for an assess-
well as balancing family and career: ment of reasonable notice to consider whether a female em-
ployee’s potential to find new employment is affected by her
The London Life Freedom 55 television commercial need to balance the demands of family and work. This evolu-
paints an attractive picture of the 55-year-old pro- tion in wrongful dismissal law reflects heightened social
fessional woman chucking it all and retreating, with awareness of the challenges women face in meeting both work
Mustang convertible and surfboard in the rear, to a and family obligations. Only time will tell whether the gender
tropical paradise for a long and deserved retirement. gap in reasonable notice awards found by Professor Thorni-
Alas, for most women this commercial is a fantasy. croft will decrease.
The statistically average Canadian woman struggles
to find a job, she receives about 60-70 per cent of * K.W. Thornicroft, “The Assessment of Reasonable Notice by Canadian
the wages received by men doing the same work, Appellate Courts from 2000 to 2011” (2013) 1 CLELJ 1 at 29.
she strives to balance family and career, she worries † Cronk v. Canadian General Insurance Co., 1994 CanLII 7293 (Ont. Sup
about losing her job, and if she does lose it she Ct J) at para 20.
desperately seeks to obtain a new job. Edna Cronk

4. Availability of Similar Employment

The final factor listed in Bardal was the “availability of similar employment, having regard to the
experience, training and qualifications of the servant.” That factor refers to the labour market
into which the dismissed employee will be entering in the search for a new job, as well as the
particular skill set the employee brings to the job search. An employee with skills that are in
wide demand (like a cashier, for example) would be expected to have an easier time finding al-
ternative employment in their field than someone with very specialized skills not widely in
demand (like an astronaut).
Judges have wrestled with how much weight to give labour market conditions in assessing
reasonable notice. If reasonable notice is a proxy for how much time it should take a dismissed
employee to find similar alternative employment, should employees be awarded longer periods
of notice in poor economic times, and shorter periods when jobs are plentiful? The courts do
not tend to order shorter periods of notice in periods of economic boom, but the “duty to miti-
gate” discussed in Chapter 14 may result in the employee receiving less money in reasonable
notice damages if they get a new job quickly. The courts have more difficulty sorting out how
to deal with employees dismissed during poor economic conditions. There are competing
arguments.
On the one hand, an employee dismissed in an economic downturn will likely have a harder
time finding new employment than an employee dismissed in strong economic times. This view
has led some judges to award longer notice periods during depressed economic periods. For ex-
ample, in the case of Lim v. Delrina (Canada) Corp., an accountant was dismissed in 1992, a par-
ticularly bad time for the accounting profession. An Ontario court found that the depressed
economic time was a relevant factor in assessing the length of notice required. The court ruled that
three months’ notice would have been awarded in normal circumstances, but then it added one
additional month’s notice “given the well known depressed economic conditions of the time.”33
On the other hand, employers may also be fighting for their survival in poor economic times,
and reducing their payroll might be necessary to avoid bankruptcy. In the 1982 case of Bohemier
v. Storwal International Inc., an Ontario court ruled that notice periods must consider the inter-
ests of both employers and employees.34 Extending notice periods in bad economic conditions
could unreasonably restrict employers’ ability to reduce the workforce at a reasonable cost and
would amount to the employer effectively insuring the employee against poor market condi-
tions. Some judges interpreted Bohemier as authority for the proposition that notice periods
should not be extended in difficult economic times or, more controversially, that notice
periods should be reduced when the employer is facing economic difficulties.35

Should the Employer’s Financial Situation Be Considered in Assessing the Length
of Reasonable Notice?
Michela v. St. Thomas of Villanova Catholic School employed on a one-year fixed-term contract that had simply
2015 ONCA 801 come to an end. The employees argued that they had really
been employed continuously pursuant to an indefinite-term
Key Facts: Three teachers at a private school had been em- contract that included an implied term requiring reasonable
ployed for between 8 to 13 years pursuant to a series of one- notice of termination. The lower court judge applied the rea-
year fixed contracts. In 2013, the employer informed them that soning from the case Ceccol v. Ontario Gymnastics (Box 8.4) and
due to falling enrolments at the school, their contracts would ruled that the one-year fixed-term contracts were ambiguous
not be renewed. The employer claimed the employees were since they also suggested that the relationship would continue
not entitled to notice of termination because they had been beyond one year, which they did. Considering all of the facts,

the court ruled that the teachers were employed under an of the employer. An employer’s financial circum-
indefinite-term contract and entitled to reasonable notice. The stances may well be the reason for terminating a
judge ruled that reasonable notice would be 12 months contract of employment—the event that gives rise
applying the normal Bardal factors, but he then reduced the to the employee’s right to reasonable notice. But an
amount to 6 months on the basis that the employer was in employer’s financial circumstances are not relevant
financial peril due to falling student numbers. He ruled that to the determination of reasonable notice in a par-
the “character of employment” included consideration of the ticular case: they justify neither a reduction in the
employer’s circumstances. The employees appealed that notice period in bad times nor an increase when
ruling. times are good. …
Bohemier does not hold, and this court has never
Issue: Are the employer’s financial circumstances relevant to
held, that an employer’s financial difficulties justify
assessing the period of reasonable notice?
a reduction in the notice period. It does no more
Decision: No. The court of appeal discussed the meaning of than to hold that difficulty in securing replacement
“character of employment”: employment should not have the effect of increas-
ing the notice period unreasonably. …
It suffices to say that the character of the employ-
ment, like the other Bardal factors, is concerned with The court of appeal ordered the lower court judge’s original
the circumstances of the wrongfully dismissed em- assessment of 12 months’ notice be reinstated.
ployee. It is not concerned with the circumstances
Judges do still occasionally extend the notice period by a small amount when an employee is
terminated during a serious economic downturn.36 However, in the 2015 decision described in
Box 10.6, the Ontario Court of Appeal clarified that the employer’s economic circumstances are
not a relevant factor in assessing reasonable notice.37
C. Other Factors Affecting the Length of Reasonable Notice

The courts have said that the list of factors in Bardal is not exhaustive, meaning that judges could
add new factors affecting the length of reasonable notice. One factor that has been added to the
list is inducement. The courts have extended the period of reasonable notice when an employee
had been induced to quit an existing job with promises of secure employment and is then dis-
missed from the new job. This is what happened in the case of Wallace v. United Grain Growers
Ltd., in which the Supreme Court of Canada stated:
[M]any courts have sought to compensate the reliance and expectation interests of terminated
employees by increasing the period of reasonable notice where the employer has induced the em-
ployee to “quit a secure, well-paying job … on the strength of promises of career advancement and
greater responsibility, security and compensation with the new organization.”38
Inducement may justify a longer notice period when the employee’s decision to quit a secure
job is accompanied by expectations of future job security that do not turn out to be accurate and
that can be attributed to words or conduct of the recruiting company.39
inducement: A factor considered in assessing the length of reasonable notice that should be awarded to an employee whose
employment contract is terminated by employer A after employer A encouraged or enticed the employee to quit a prior job with
company B to come to work for employer A.

Some attempts to introduce new factors to the list have ultimately failed. For example, the
Supreme Court of Canada rejected a line of cases in which lower court judges had reduced the
period of reasonable notice when they believed the employee had engaged in misbehaviour that
was not quite serious enough to amount to cause for summary dismissal without notice (“near
cause”).40
IV. Chapter Summary

An employer can terminate an indefinite-term employment contract by giving the employee
notice. The contract itself might indicate how much notice is required and, provided the amount
does not violate applicable employment standards legislation, the expressed contract term
would govern. However, absent a legally compliant notice clause, the courts imply a duty to
provide “reasonable notice.” This chapter explored the origins and application of “reasonable
notice” by common law judges. We learned that the courts are guided by a list of factors set down
in the 1960 case of Bardal v. Globe & Mail Ltd. This approach gives judges considerable discre-
tion and also adds uncertainty to the termination process, since neither employer nor employee
knows for sure how much notice a court could order. However, by reading prior decisions, it is
possible to estimate the range of possible notice by considering the factors in Bardal.

1. What is the purpose of requiring employers to provide employees with reasonable notice?
2. Does every employment contract in Canada require the employer to provide the employee
with reasonable notice of termination? Explain your answer.
3. What rationale has justified the courts granting longer periods of reasonable notice to
managerial employees over non-managerial employees? Explain why in recent years courts
have begun to question this rationale.
4. Do Canadian courts consider the employer’s financial situation when assessing the period
of reasonable notice?
5. Explain the difference between the Canadian and American approach to the termination
of employment contracts.
APPLYING THE LAW

1. Janice is the human resources manager for ABC Com- uses a software program that estimates how the
puters Inc., a small computer rental company with 25 courts will apply the Bardal factors. Enter the infor-
employees. The company needs to downsize its work- mation for both Davidov and Chloe in the program
force and has decided to terminate two non-union when prompted. You can skip the page that asks
employees: Davidov, a 55-year-old technical worker about the employee’s salary. What amount of rea-
with 15 years’ service, and Chloe, a 28-year-old middle sonable notice does the severance calculator tell
manager with 5 years’ service. Neither employee had you that a court would order? Were you close in
signed an employment contract. Janice has asked you your estimate?
to help her decide how much notice she is required to c. Finally, turn to Table 20.1 in Chapter 20, which
provide each employee. examines how termination of employment con-
a. Based on what you have learned in this chapter, try tracts is dealt with under employment standards
to estimate what amount of reasonable notice a legislation. Locate your province and identify how
court might order for both employees and explain much notice would be required under the statute
your thinking. to terminate Davidov and Chloe. How does the
b. Now go a website called “Severance Pay Calcula- amount of “reasonable notice” compare with the
tor”: <https://www.severancepaycalculator.com>. amount of minimum notice required by employ-
This website is created by a Toronto law firm and it ment standards legislation?

EXERCISE
1. To better understand the factors that influence reasonable notice, try the following
exercise:
a. Go to the CanLII home page: <https://www.canlii.org>.
b. In the “Document text” search box, type “reasonable notice.” That search will produce
thousands of cases in which employees have sued their former employers for failing to
provide reasonable notice of termination. Select three of those cases and read them.
c. Prepare a case summary for each case that includes the key facts, the issue, and the de-
cision. In each case summary, be sure to describe the factors the court considered in
assessing the amount of reasonable notice required.

1. In addition to the cases cited in Box 10.1, see also the fol- shipping employee and substituting a notice period match-
lowing cases, which emphasize employee vulnerability and ing the statutory minimum: “If at the outset of his employ-
the power imbalance that defines employment contracts: ment, the employer had been asked what notice must you
Bowes v. Goss Power Products Ltd., 2012 ONCA 425; Refer- give if you terminate him, I should think that the answer
ence Re Public Service Employee Relations Act (Alta.), would have been ‘whatever the law requires.’ If the em-
[1987] 1 SCR 313; and Braiden v. La-Z-Boy Canada ployee had been asked what notice must you give if you
Limited, 2008 ONCA 464. want to leave, he would be surprised to have been told he
2. Lowe v. Walter, [1892] 8 TLR 358. Much of the history needed to give more than a week or two.” See also G.
recounted in this chapter is taken from C. Mummé, “That England, Individual Employment Law, 2nd ed (Toronto:
Indispensable Figment of the Legal Imagination: The Con- Irwin Law, 2008) at 300-1.
tract of Employment at Common Law in Ontario, 10. England, supra note 9 at 311. See also Medis Health and
1890s – 1979” (PhD thesis, York University, 2013). Pharmaceutical Services v. Bramble, 1999 CanLII 13124
3. Earl of Halsbury, The Laws of England, vol 20 (London: (NBCA).
n.p., 1911) at 96. 11. The Bardal approach was approved by the Supreme Court
4. Bain v. Anderson & Co., [1898] 28 SCR 481. of Canada in Machtinger v. HOJ Industries Ltd., supra note
6, and by various provincial courts of appeal: Wiebe v.
5. Speakman v. City of Calgary (1908), 9 WLR 264 (Alta. CA).
Central Transport Refrigeration (Man.) Ltd., 1994 CanLII
6. Carter v. Bell & Sons (Canada) Ltd., 1936 CanLII 75 (Ont. 6406 (MBCA); Giza v. Sechelt School Bus Service Ltd., 2012
CA). The earlier cases in which “reasonable notice” was BCCA 18; and Di Tomaso v. Crown Metal Packaging
applied include Pollard v. Gibson, 1924 CanLII 398 (Ont. Canada LP, 2011 ONCA 469.
CA); and Messer v. Barrett Co. Ltd. (1926), 59 OLR 566
12. This point is made by Justice McLachlin in Machtinger v.
(SC (AD)). The Supreme Court of Canada confirmed the
HOJ Industries Ltd., supra note 6 at 1009.
presumption that Canadian employment contracts require
reasonable notice for termination unless otherwise speci- 13. Panimondo v. Shorewood Packaging Corporation, 2009
fied in Machtinger v. HOJ Industries Ltd., [1992] 1 SCR CanLII 16744 (Ont. Sup Ct J).
986. See also Prozak v. Bell Telephone Co. of Canada, 1984 14. Minott v. O’Shanter Development Company Ltd., 1999
CanLII 2065 (Ont. CA). CanLII 3686 (Ont. CA) at para 62.
7. Lazarowicz v. Orenda Engines Ltd., 1960 CanLII 151 15. McKay v. Camco Inc., 1986 CanLII 2544 (Ont. CA) at 267;
(Ont. CA). and Cronk v. Canadian General Insurance Co., 1995 CanLII
8. In her concurring judgment in Machtinger v. HOJ Indus- 814 (Ont. CA).
tries Ltd., supra note 6 at 1012-13, Justice McLachlin of the 16. Erskine v. Viking Helicopter Ltd. (1991), 35 CCEL 322 (Ont.
Supreme Court of Canada wrote that the reasonable notice Gen Div) at 326.
term is implied “in law as a necessary incident” of employ- 17. K.W. Thornicroft, “The Assessment of Reasonable Notice
ment contracts rather than a term implied “in fact.” This by Canadian Appellate Courts from 2000 to 2011” (2013)
would mean that the intention of the parties is not at issue. 17 CLELJ 1 at 29.
9. See Pelech v. Hyundai Auto Canada Inc., 1991 CanLII 920 18. Ansari v. B.C. Hydro & Power Auth., 1986 CanLII 1023
(BCCA), quashing an award of four months’ notice for a (BCSC) at 39.

19. Wallace v. United Grain Growers Ltd., [1997] 3 SCR 701; Thornicroft, supra note 17 at 20-21, notes that between
and Webster v. British Columbia (Hydro and Power Au- 2000 and 2011, “character of employment” continued to
thority), 1992 CanLII 1087 (BCCA) at 109. influence the length of reasonable notice periods. Clerical/
20. McKay v. Eaton Yale Ltd., 1996 CanLII 8234 labour employees received from 1.4 to 3.6 months’ less
(Ont. Sup Ct J); and Bullen v. Protor & Redfern Ltd., notice than higher level employees. However, the period of
1996 CanLII 8135 (Ont. Sup Ct J). that study mostly pre-dates the move toward placing less
influence on “character of employment” discussed in the
21. Minott v. O’Shanter Development Company Ltd., supra
series of cases mentioned in the chapter.
note 14. See also Kerfoot v. Weyerhaeuser Company
Limited, 2013 BCCA 330; and Capital Pontiac Buick Cadil- 33. Lim v. Delrina (Canada) Corp., 1995 CanLII 7271 (Ont.
lac GMC Ltd v. Coppola, 2013 SKCA 80. SC) at para 31. Other cases that have considered poor eco-
nomic conditions as a factor justifying extended notice
22. B. Fisher, “Revisiting Reasonable Notice Periods in Wrong-
periods include Squires v. Corner Brook Pulp & Paper Ltd.
ful Dismissal Cases: 2006 Edition,” online (pdf): <http://
and Manuel, 1994 CanLII 10373 (Nfld. SC); Hunter v.
barryfisher.ca/papers/Revisiting_Reasonable_Notice.pdf>.
Northwood Pulp and Timber Ltd., 1985 CanLII 443
23. McKinney v. University of Guelph, [1990] 3 SCR 229 at para (BCCA); Anderson v. Haakon Industries (Canada) Ltd.,
92; Thornicroft, supra note 17 at 27. 1987 CanLII 2406 (BCCA); Valley Forest Products Ltd. v.
24. Thornicroft, supra note 17 at 20. See also K.W. Thornicroft, Dey, 1995 CanLII 5582 (NBCA); Sicard v. Timminco Ltd.
“Severance Pay and the Older Worker: Negotiated Versus (1994), 3 CCEL (2d) 50 (Ont. Gen Div); Garcia v. Crest-
Litigated Outcomes Under Canadian Common Law” brook Forest Industries Ltd., 1993 CanLII 1412 (BCCA);
(2015) 52-4 Alb L Rev 779. and Hampton Securities Limited v. Dean, 2018 ONSC 101.
25. Bohemier v. Storwal International Inc., 1983 CanLII 1956 34. Bohemier v. Storwal International Inc., supra note 25.
(Ont. CA); Cronk v. Canadian General Insurance Co., supra 35. See, e.g., Shuya v. Azon Canada Inc., 1995 CanLII 9084
note 15; and Ansari v. B.C. Hydro & Power Auth., supra (Alta. QB); Heinz v. Cana Construction Co., 1987 CanLII
note 18. 3203 (Alta. QB); Erskine v. Viking Helicopter Ltd., supra
26. Cronk v. Canadian General Insurance Co., supra note 15. note 16; and Gristey v. Emke Schaab Climatecare Inc., 2014
27. Cronk v. Canadian General Insurance Co., 1994 CanLII ONSC 1798.
7296 (Ont. Sup Ct J). 36. See authorities at supra note 33.
28. Cronk v. Canadian General Insurance Co., supra note 15. 37. Michela v. St. Thomas of Villanova Catholic School, 2015
29. Ibid. ONCA 801; and Nielsen v. Sheridan Chevrolet Cadillac
Ltd., 2016 ONSC 1843.
30. Minott v. O’Shanter Development Company Ltd., supra
note 14. 38. Wallace v. United Grain Growers Ltd., supra note 19 at
paras 83, 85.
31. Oudin v. Le Centre Francophone de Toronto, 2015 ONSC
6494 at para 61. 39. Ibid.; see also Alcatel Canada Inc. v. Egan, 2006 CanLII 108
(Ont. CA); Craig v. Interland Window Mfg. Ltd., 1993
32. Cases in which non-managerial employees received CanLII 1821 (BCSC); Nicholls v. Columbia Taping Tools
greater than 12 months’ notice include the following: Di Ltd., 2013 BCSC 2201; Wright v. Feliz Enterprises
Tomaso v. Crown Metal Packaging Canada LP, 2011 ONCA Ltd., 2003 BCSC 267 (it is not inducement if the employee
469 (22 months); Strudwick v. Applied Consumer & Clini- and employer were equally interested in forming a new
cal Evaluations Inc., 2016 ONCA 520 (20 months); AMEC relationship); Pollock v. Cotter, 2005 BCSC 1799; Greenlees
Americas Limited v. MacWilliams, 2012 NBCA 46 (20 v. Starline Windows Ltd., 2018 BCSC 1457; and Dias v.
months); Systad v. Ray-Mont Logistics Canada Inc., 2011 Paragon Gaming EC Company, 2010 ABPC 390.
BCSC 1202 (18 months); Patterson v. IBM Canada
Limited, 2017 ONSC 1264 (18 months); Skov v. G&K Ser- 40. See Dowling v. Halifax (City), [1998] 1 SCR 22. See also
vices Canada Inc., 2017 ONSC 6752 (18 months); and Cicalese v. Saipem Canada Inc., 2018 ABQB 835; and
Welch v. Ricoh Canada Inc., 2017 NSSC 174 (16 months). Porter v. Fleischer, 2011 BCSC 389.

C H A P T E R 11
Termination by “Frustration”

II. The Implications of a Finding of Frustration of Contract 169
• Define frustration of contract and identify the circumstances in
III. The Test for Frustration of Contract 170
which it can arise.
IV. Frustration Due to Illness or Disability 171
• Describe the implications of a finding of frustration of A. What Medical Evidence Is Relevant in Assessing Permanent
contract. Disability? 171
• Explain the test for frustration of contract. B. Does Frustration of Contract Apply When a Contract Provides for
• Explain how an employee illness or disability can bring about Sickness and Disability Benefits? 172
frustration of contract. C. Is the Duty to Accommodate a Disabled Worker a Precondition for
Frustration of Contract? 173
• Discuss the key controversies related to applying frustration of V. Chapter Summary 175
contract to employee illness or disability under an employment Questions and Issues for Discussion 175
contract.
I. Introduction
Frustration of contract does not fit coherently into any of the other chapters dealing with ter-
mination of employment contracts, so it gets its own short chapter. A contract that is frustrated
is terminated neither by agreement of the parties nor as a result of the actions of the employer
or employee. Rather, a frustrated contract comes to an end because something unexpected hap-
pens that prevents one or both of the parties from doing what they promised in the contract to
do.1 The classic examples of frustration of the employment contract include circumstances in
which workplaces are destroyed by an “act of God,” such as a fire. Over time, frustration has been
applied to other intervening events that make performance of the contract as originally envi-
sioned impossible, including an employee injury or disability. This chapter examines the evolu-
tion of, application of, and controversies relating to frustration of contract in the Canadian
employment setting.
II. The Implications of a Finding of Frustration of Contract

The most important consequence of a finding of frustration of contract is that it instantly
terminates the contract, relieving the parties of any future contractual obligations. It means
most notably that both employer and employee are relieved of their contractual obligation to
frustration of contract: The termination of a contract caused by an unforeseen event that renders performance of the contract
impossible.
169

provide notice of termination.2 In the common law regime, an employee who is dismissed
without receiving the notice required by the contract is entitled to recover monetary damages
calculated based on an assumption that the employee had worked through the notice period.
However, the employer is not required to provide any notice of termination in the following
scenarios:
1. When the employee terminates the contract (Chapter 15).

2. When the contract is a fixed-term or fixed-task contract, as opposed to an indefinite-
term contract (Chapter 8).
3. When the employee commits a fundamental breach of the contract, which the em-
ployer treats as cause for dismissal without notice (known as summary dismissal;
Chapter 12).
4. When the contract is frustrated.
Arguments about frustration of contract usually arise in the context of an employer who is
defending a wrongful dismissal lawsuit: the employer announces that the contract is terminated
by frustration and the employee sues for wrongful dismissal, asserting that they are entitled to
receive notice of termination. The court then needs to decide if the conditions for frustration
were satisfied.
Professor Geoffrey England has argued that the “doctrine of frustration is concerned with
who should bear the risk of the unforeseen events.”3 When frustration exists, the burden of the
risk falls on the employee, who will lose out on any contractual entitlements to which they
otherwise would have been entitled to as a consequence of losing their job. On the other hand,
if the unforeseen event does not frustrate the contract, the employer shoulders the financial
implications of the termination of the contract. As we consider the law of frustration in the
remainder of this chapter, think about who bears the risk of the event that intervenes in the per-
formance of the contract.
III. The Test for Frustration of Contract

The modern-day test for contract frustration dates from the 1956 British House of Lords deci-
sion Davis Contractors Ltd. v. Fareham Urban District Council.4 The facts of that case are not
important for our purposes, but the court’s statement of the legal test is:
[F]rustration occurs whenever the law recognises that, without default of either party, a contractual
obligation has become incapable of being performed because the circumstances in which perform-
ance is called for would render it a thing radically different from that which was undertaken by the
contract. Non haec in foedera veni. It was not this that I promised to do.5
The Supreme Court of Canada later endorsed this test.6 It has been applied to employment
contracts in a number of situations.
The classic application of frustration of contract in the employment setting involves the
destruction of the workplace by an unexpected event, such as a tornado, flood, or fire. That is
what occurred in the early and often-cited British case of Taylor v. Caldwell, in which a music
hall was destroyed by fire, resulting in the cancellation of several musical performances.7 The
death of an employee during the term of a contract also frustrates the contract, since this inter-
vening event obviously prevents further performance.8 A change in the law that would make it
unlawful for the employee to continue to perform their job would also frustrate the contract.
For example, the employment contract of a casino security guard with a prior criminal record
(for breaking and entering) was frustrated when a new statute was enacted prohibiting security
guards from having criminal records.9

Chapter 11 Termination by “Frustration” 171
Frustration does not occur when the reason the original contract cannot be performed is due
to the voluntary actions of one of the parties. This is known as self-induced frustration. Thus,
an employer’s filing for bankruptcy does not frustrate an employment contract.10 Nor does the
doctrine of frustration apply to terminations or layoffs caused by a business downturn, loss of
customers,11 or a strike by some of an employer’s employees.12 These are normal events that
occur within the ebb and flow of capitalist economies.
IV. Frustration Due to Illness or Disability

Frustration of contract in the work context arises most often due to employee illness or dis-
ability. Common law judges long ago decided that absenteeism due to illness or disability
(innocent absenteeism) is not “cause for summary dismissal” because the employee’s behaviour
is not blameworthy.13 Employees unable to work due to illness or disability are still entitled to
notice of termination, and since they cannot work the notice period through no fault of their
own, the employer is obligated to provide pay in lieu of notice unless they can persuade the
court that frustration applies.14 However, these general rules do not apply if the employee’s dis-
ability or illness “frustrates” the employment contract.
The courts have found that an employee’s illness or disability can frustrate an employment
contract if the evidence indicates that the medical condition is such that performance in the
future will be impossible or “radically different” from what was contracted for.15 A variety of
factors are relevant in making this assessment, and each case is decided on its own particular
facts. For example, a contract that is for a short duration or that involves a senior employee
without whom the employer cannot function for long will be more easily frustrated than an
indefinite-term contract involving a worker who is more easily replaced.16
In practice, though, most decisions boil down to an assessment of whether the medical evi-
dence indicates that the employee’s disability is permanent rather than temporary, such that it
will forever, or for the foreseeable future, prevent the employee from returning to the job they were
hired to perform.17 It is the responsibility of the party alleging that frustration has occurred (usu-
ally the employer) to persuade a court.18 Therefore, even a long absence from work due to illness
will not frustrate an employment contract unless the employer can demonstrate that a return to
work is unlikely in the foreseeable future.19 By contrast, where the evidence indicates that a dis-
ability is permanent, a finding of frustration can result, even if the employee had been absent for
only a short period of time prior to the employer announcing the end of the contract.20
Applying the doctrine of frustration to employee illness or disability under an employment
contract has given rise to a number of complex and interesting legal issues and debates. Three
are worth noting briefly in this chapter.
A. What Medical Evidence Is Relevant in Assessing Permanent Disability?

The first controversy relates to the medical evidence that judges should consider in deciding
whether the illness will prevent the employee from performing their job for the foreseeable
future. Medical conditions can change; people sometimes get better, or their condition can de-
teriorate over time. This point raises the question of the period of time judges should look at
when assessing the employee’s prognosis and potential to return to work. Should judges look
only at the evidence that was available at the time the employer decided to treat the contract as
self-induced frustration: When the actions of the employer or employee make it impossible for the contract as
originally envisioned to be performed. The courts have refused to apply the doctrine of frustration to self-induced frustration.
innocent absenteeism: An employee’s absence from work due to reasons that are not blameworthy, such as illness,
disability, or religious observance.

having been terminated? Or should judges consider “how things actually turned out,” as assessed
at the date of the trial, which could be months or even years after the employment contract was
initially terminated? As described in Box 11.1, judges have not always agreed on the answer.

Assessing Whether an Employee’s Disability Is Permanent
An employment contract can be frustrated by a permanent foreseeable future. Examples of this approach include Wilmot
disability suffered by the employee. This requires employers v. Ulnooweg Development Group Inc., 2007 NSCA 49; Altman v.
and the courts to assess medical evidence about the prognosis Steve’s Music, 2011 ONSC 1480; Marshall v. Harland & Wolff
of the employee’s ability to return to work. The courts have Ltd., [1972] 1 WLR 899 (CA); White v. Woolworth (F.W.) Co., 1996
long debated whether that assessment should be based on CanLII 11076 (Nfld. CA); and Ciszkowski v. Canac Kitchens, 2015
medical evidence available at the moment the employer elects ONSC 73.
to treat the contract as having been terminated, or at the time
of a trial, which could be months or even years later. Approach Two: Consider All Medical Evidence up to the
For example, imagine that at the time the employer informs Date of the Trial
the employee that the contract is over, the evidence indicates Another line of cases argues that post-termination medical
that the employee will likely be unable to return to work for evidence is relevant. This approach argues that insofar as med-
the foreseeable future. However, by the time the wrongful ical evidence obtained after the termination of the contract
dismissal lawsuit reaches a judge months later, the employee’s can shed light on the question of whether the employee was
condition has improved dramatically, and the employee could able to return to work, it is relevant and should be considered
have returned to work after all. Which medical diagnosis by a court in assessing whether the contract was frustrated.
should govern? Judges have disagreed on the answer. Examples of this approach include Yeager v. R.J. Hastings Agen-
cies Ltd., 1984 CanLII 533 (BCSC) and Demuynck v. Agentis In-
Approach One: Consider Only Medical Evidence Available formation Services Inc., 2003 BCSC 96.
on the Date of Termination Whether one approach or the other benefits the em-
One line of cases rules that only evidence known at the ployee or the employer will depend on the facts and circum-
date of the employer’s decision to terminate the contract stances of the case. Can you think of scenarios in which an
should be considered, since that is the point at which the em- employer would prefer the first line of argument and then
ployer was required to demonstrate frustration existed and other scenarios in which the employer would prefer the
that the employee would be unable to return to work for the second approach?
B. Does Frustration of Contract Apply When a Contract Provides for Sickness
and Disability Benefits?
Another controversy relates to the relevance of contract terms that entitle an employee to receive
disability benefits if they become ill or disabled. The doctrine of frustration usually applies to
“unforeseen circumstances”21 that were not in the “reasonable contemplation of the parties”
when the contract was formed and that have the effect of rendering performance as originally
anticipated impossible.22 If the contract sets out in detail what happens when the employee
becomes ill or disabled, then the parties clearly have contemplated the possibility that the em-
ployee may be felled by illness and unable to work. Consider the case of the factory that burns
to rubble, leaving the factory employees with no work to perform. If their employment contracts
specifically contemplate the possibility that the factory may be destroyed by fire, and also
describes what will happen in that event, then the doctrine of frustration would not apply. Simi-
larly, if an employment contract contemplates that an employee unable to work due to illness
will remain employed throughout the absence while they receive sickness or disability insurance
benefits, then frustration is unlikely to result from the illness.23
However, many employment contracts envision that an employee unable to work due to ill-
ness or disability can be terminated even if they are entitled to continue to receive insurance
benefits after the termination. In those cases, courts have ruled that frustration can terminate
the contract, as explained in the decision discussed in Box 11.2.24


Frustration Caused by Employee Disability When the Contract Provides Long-Term
Disability Benefits
Wightman Estate v. 2774046 Canada Inc. clearly did—but whether “the parties have provided that their
2006 BCCA 424 contractual relationship will continue despite the radical change
in circumstances brought about by the event” (emphasis added).
Key Facts: The employment contract between Wightman and The court must ask whether the disability is such that it will
2774046 Canada Inc. (the employer) required the employer to be impossible for the employee to perform his duties or the
provide “reasonable notice” of termination and provided for performance of those duties would be radically different than
long-term disability benefits until age 65 or Wightman’s death, what was originally agreed. Frustration of contract will not
whichever came first. Wightman suffered from a series of med- result from a short-term illness or disability. However, when
ical problems and began to receive disability benefits. While the evidence discloses that the employee will be unable to
he was receiving disability benefits, he was dismissed without perform the job he was hired to do for the foreseeable future,
notice. One year later, at the age of 61, Wightman died. His the contract can become frustrated.
estate executor filed a lawsuit for wrongful dismissal on Wight- In this case, the contract recognized the possibility that
man’s behalf, claiming damages for failure of the employer to benefits could continue beyond the date at which the employ-
give Wightman reasonable notice of termination. The em- ment contract ends. For example, the benefits plan, which was
ployer argued that the contract was frustrated by Wightman’s part of the contract, referred to the possibility that the em-
illnesses. ployee might “change employers” and provided for payment
Issue: Can an employee disability cause frustration of contract of benefits “[i]f … employment ends.” Therefore, the parties
when the contract itself contemplates that an employee may contemplated that the employment contract could come to
become permanently disabled? an end for some reason even though the employee was dis-
abled at the time of termination. The evidence indicated that
Decision: Yes. The court found that the proper test for frustra- Wightman would not be able to return to any job for the
tion is not whether the parties contemplated the possibility foreseeable future. Therefore, the contract had become frus-
that a long-term disability might occur—which here they trated as a result of Wightman’s illness.
C. Is the Duty to Accommodate a Disabled Worker a Precondition for

Frustration of Contract?
A third controversy that arises from the application of the doctrine of frustration of contract to
ill or disabled employees raises an interesting question about the intersection of the three
regimes of work law (the common law regime, the regulatory standards regime, and the collec-
tive bargaining regime) introduced in Chapter 1.
Under Canadian human rights law, an employer cannot dismiss an employee for absenteeism
due to a disability unless it can first demonstrate that it is not possible to accommodate the
employee’s disability without incurring undue hardship.25 (Part III explores human rights legis-
lation.) Volumes of human rights law decisions explore this standard. The Canadian Charter of
Rights and Freedoms (Chapter 38), which governs the actions of government, similarly prohibits
discrimination against workers on the basis of disability and requires accommodation of dis-
abilities to the point of undue hardship.26 As we will learn in Part IV, unionized workers who are
governed by collective agreements are also entitled to accommodation to the point of undue
hardship if they become disabled and unable to perform their normal job.
Most people have at least a vague awareness that Canadian law imposes on employers a
requirement to accommodate employee disabilities, even if they are not aware of the specific
legal source of the requirement. If disability prevents an employee from performing their ori-
ginal job, but the employer could modify the job or move the employee into a different vacant
position that they could perform, the expectation is that the employer will take that step. Human
rights statutes, collective agreements, and the Charter all require at least that much.

However, the common law regime has not yet recognized a parallel requirement for accom-
modation to be explored as a precondition for a finding of frustration due to disability. The job
contemplated by the original contract is taken as fixed, and judges ask only whether the dis-
ability will for the foreseeable future prevent the employee from performing it or require that
the job be performed in a “radically different” manner than originally envisioned. If so, then the
contract is frustrated. The fact that the employee could return to work if the job were modified
in some manner or if offered a different job has been treated as irrelevant in the application of
the doctrine of frustration.27 The employer’s implied prerogative to decide what job an employee
will perform is left untouched by the contract law doctrine of frustration.
The result is that frustration of contract, a contract law doctrine with 19th-century roots, is
today at odds with modern-day expectations and sentiments on the appropriate treatment of
workers with a disability. A common law judge could agree with an employer that an employ-
ee’s disability frustrated the contract, even though the employer had ignored its statutory
obligation to accommodate the employee’s disability.28 We noted in Chapter 2 that the three
regimes of work law are not blind to developments in the other regimes. Sometimes legal rules
developed in one regime can penetrate and influence the evolution of laws in the other
regimes. An interesting question is whether the common law regime’s doctrine of frustration
of contract will evolve to recognize a duty to accommodate employee disabilities that parallels
the statutory duty to accommodate. As noted in Box 11.3, there has been movement in this
direction already.

Frustration of Contract and the Interaction of Legal Regimes
Chapter 2 introduced a framework for analyzing the law of empted from these requirements when the employment
work. It noted that work law comprises three distinct regimes: contract has become “frustrated.”* In a 2005 decision, the
the common law regime, the regulatory standards regime, and Ontario Court of Appeal ruled that this exemption violated the
the collective bargaining regime. Those three regimes have Charter of Rights and Freedoms equality rights section (s. 15)
their own legal rules, actors, and institutions and produce their insofar as it punished disabled workers.† As a result, today the
own legal outputs. However, we noted too that through an “frustration” exemption in the Ontario ESA does not apply
internal feedback loop, legal rules and norms produced by one when the frustration is due to the employee’s illness or injury.‡
regime can influence developments in other regimes. The Therefore, the Ontario government has incorporated into the
doctrine of frustration of contract offers an example of the statute a modified version of the common law doctrine of
complexity of interactions among regimes. frustration.
The Influence of the Common Law Regime on the The Influence of the Regulatory Standards Regime on the
Regulatory Standards Regime Common Law Regime
Frustration of contract is an output of the common law regime, Canadian courts have found that an employee’s disability can
a legal rule developed in 19th-century Britain, later adopted frustrate a contract if, for the foreseeable future, that disability
by Canadian common law judges and applied to employment will prevent the employee from performing the job they were
contracts. As noted above, frustration brings a contract to an hired to do. In applying the doctrine of frustration to employee
end without any need for the parties to give the usual common disabilities, common law judges have not usually considered
law notice of termination and without creating any liability whether the employee’s disability could have been accom-
arising from the termination. The contract just ends. This con- modated in such a way that would enable the employee to
cept was later incorporated into employment standards stat- return to work. Within the regulatory standards regime (as we
utes (in the regulatory regime). will learn in Part III), human rights legislation prohibits an
For example, in Ontario, the Employment Standards Act employer from treating the employment contract as frustrated
(ESA) requires employers to provide employees with notice of unless the employer first establishes that there is no way to
termination and sometimes an additional payment known as accommodate the employee’s disability without incurring un-
severance pay (see Chapter 20). However, employers are ex- due hardship.

In the 1998 decision Antonacci v. Great Atlantic & Pacific finding frustration of contract will take hold in Canadian com-
Co. of Canada, Justice Swinton appeared to modify the common law. For example, the courts could conclude that before
mon law doctrine of frustration by incorporating the human frustration can be made out, an employer must first exhaust
rights statute concept of “accommodation.” The employer accommodation efforts, including modifying the employee’s
argued in that case that the employment contract had been job or considering whether the employee could be offered a
frustrated by the employee’s disability. Justice Swinton re- different job within their capabilities. This approach would
jected that argument, and in doing so introduced a duty to produce a more coherent legal model than exists at present.
accommodate: It would also be consistent with the Supreme Court of Canada’s
observation that the common law should evolve in a manner
Section 5 of the Ontario Human Rights Code prohibits consistent with “Charter values.”#
discrimination on the basis of handicap … [Evidence
indicated that the employee’s] job as a Store Man- * See Ontario Regulation 288/01, ss. 2(1)4, 9(1)4.
ager could be modified to accommodate a worker † Ontario Nurses’ Association v. Mount Sinai Hospital, 2005 CanLII 14437
with a back injury. Even if that did not turn out to be (Ont. CA).
the case, given the extent of the plaintiff’s back ‡ Ontario Regulation 288/01, ss. 2(3), 9(2)b.
problems, A & P, with 24,000 workers in Ontario,
§ Antonacci v. Great Atlantic & Pacific Co. of Canada, 1998 CanLII 14734
might well have been able to find alternative suitable (Ont. Sup Ct J) at para 41, aff’d 2000 CanLII 5496 (Ont. CA).
work for him. Given these facts, it could not be said
# See RWDSU, Local 558 v. Pepsi-Cola Canada Beverages (West) Ltd., [2002] 1
that the plaintiff’s contract was frustrated.§ SCR 156; and Lemesani v. Lowerys Inc., 2017 ONSC 1808 (judge finding a
common law duty to accommodate a disabled worker in the context of
It remains to be seen whether this approach requiring a frustration argument).
exploration of possible accommodation as a condition for
V. Chapter Summary

Frustration of contract terminates a contract through no fault of either party, extinguishing any
future contractual obligations the parties owed one another. Frustration usually requires an
intervening event that was not contemplated by the parties that makes it impossible for the
contract to be performed as originally envisioned. The most noteworthy consequence of a find-
ing of frustration is that the employer is relieved of its obligation to give the employee notice of
termination. Since the implications are so serious, the courts have been cautious in applying the
doctrine. However, they have been prepared to find frustration arising from employee illness or
disability, provided that the evidence establishes the employee will be unable to perform the job
they were hired to do for the foreseeable future. Traditionally, common law judges have not
considered whether the employee’s disability can be accommodated as a precondition of a find-
ing of frustration. This approach puts the common law regime in tension with human rights
laws, which prohibit termination of employment contracts for disability-related absences unless
accommodation would incur undue hardship on the employer.

1. Explain the test for frustration of contract, and provide some examples of how it might
arise in the employment setting.
2. What must an employer prove in order to persuade a court that a contract has been frus-
trated due to the employee’s illness?
3. Why would an employer want to argue that an employment contract has become
frustrated?
4. What is “self-induced frustration”? Provide examples.
5. Can an employment contract that entitles an employee to receive long-term disability
benefits until the age of 65 be frustrated while the employee is collecting those benefits?
How does the Wightman Estate case described in Box 11.2 affect your answer?

APPLYING THE LAW

1. Bridget suffered a back injury that prevented her from the employer provide Bridget with reasonable notice
performing her job with her employer ABC Plumbing of termination? Explain your answer.
Services. She has already missed eight months of work. 2. Would your answer to question 1 be different if
Last week, Bridget’s doctor wrote a letter for the em- you learned that the employment contract between
ployer that states he does not expect Bridget to be Bridget and ABC Plumbing included a clause that
able to return for the foreseeable future. The employer entitled Bridget to long-term disability benefits if she
decides to terminate Bridget’s employment. The con- becomes ill and that she may not be terminated while
tract says nothing about notice of termination. Must receiving those benefits?

1. See Chilagan v. Island Lake Band No. 161, 1994 CanLII 12. St. John v. TNT Canada Inc., 1991 CanLII 420 (BCSC). See
4787 (Sask. QB); Wightman Estate v. 2774046 Canada Inc., also the discussion in R.S. Echlin and J. Fantini, Quitting for
2006 BCCA 424 at 24; and Davis Contractors Ltd. v. Good Reason (Toronto: Canada Law Book, 2001) at 118-19.
Fareham Urban District Council, [1956] AC 696 at 728. The 13. See Yeager v. R.J. Hastings Agencies Ltd., 1984 CanLII 533
Supreme Court of Canada described the doctrine of frus- (BCSC), at paras 71-72.
tration in Naylor Group Inc. v. Ellis-Don Construction Ltd.,
14. Sylvester v. British Columbia, [1997] 2 SCR 315 at paras 9,
2001 SCC 58; and Peter Kiewit Sons’ Co. v. Eakins Construc-
15; and McRae v. Dodge City Auto (1984) Ltd., 1994 CanLII
tion Ltd., [1960] SCR 361. See also J. McCamus, The Law of
4955 (Sask. QB). See also the discussion in England, supra
Contracts, 2nd ed (Toronto: Irwin Law, 2012) at chapter 14.
note 3 at 420-21.
2. See the discussion in McLean v. City of Miramichi, 2011
15. Dartmouth Ferry Commission v. Marks 34 SCR 366; Wight-
NBCA 80.
man Estate v. 2774046 Canada Inc., supra note 1; Marshall
3. G. England, Individual Employment Law, 2nd ed (Toronto: v. Harland & Wolff Ltd., [1972] 1 WLR 899 (CA); Yeager v.
Irwin Law, 2008) at 418. See also, McCamus, supra note 1 R.J. Hastings Agencies Ltd., supra note 13; Skopitz v. Inter-
at 612-22. corp Excelle Foods Inc., 1999 CanLII 14852 (Ont. Sup Ct J);
4. Davis Contractors Ltd. v. Fareham Urban District Council, Ryhorski v. Commercial Industrial Manufacturing Ltd., 2019
supra note 1. SKQB 85; Fraser v. UBS, 2011 ONSC 5448; Lemesani v.
5. Ibid. at 728-29. Lowerys Inc., 2017 ONSC 1808; Roskaft v. RONA Inc., 2018
ONSC 2934; and Duong v. Linamar Corporation, 2010
6. Peter Kiewit Sons’ Co. v. Eakins Construction Ltd., supra ONSC 3159.
note 1 at 368; and Naylor Group Inc. v. Ellis-Don Construc-
tion Ltd., supra note 1. 16. The leading case that describes the factors courts should
consider in assessing whether an employment contract has
7. Taylor v. Caldwell, [1893] 122 ER 309 (QB). See also Polyco been frustrated is Marshall v. Harland & Wolff Ltd., supra
Window Manufacturers Ltd. v. Saskatchewan (Director of note 15 at 718-19. See also Dragone v. Riva Plumbing
Labour Standards), 1994 CanLII 5008 (Sask. QB). Limited, 2007 CanLII 40543 (Ont. Sup Ct J) at para 21.
8. McLean v. City of Miramichi, supra note 2 at para 25; Wing- 17. This distinction between temporary and permanent dis-
field Estate v. Conroy, [1996] BCJ No. 799 (QL) (SC); and ability has deep roots and was noted in Dartmouth Ferry
MacDonald v. School District No. 39, 2004 BCSC 1611. Commission v. Marks, supra note 15.
9. Cowie v. Great Blue Heron Charity Casino, 2011 ONSC 18. Dragone v. Riva Plumbing Limited, supra note 16.
6357. See also Reilly v. The King, 1933 CanLII 379 (UK
19. For example, in Yeager v. R.J. Hastings Agencies Ltd., supra
JCPC); and Thomas v. Lafleche Union Hospital, 1989 CanLII
note 13, the employee had been absent for two years due to
5078 (Sask. QB); aff ’d. 1991 CanLII 8039 (Sask. CA)
illness, but the contract was not frustrated since the evi-
(a nurse’s contract frustrated after her nursing licence was
dence did not establish that illness would persist for the
revoked).
foreseeable future. Other cases in which courts found no
10. Optenia Inc. (In Bankruptcy) (Re), 2002 CanLII 5308 (Ont. frustration due to lack of evidence that the employee
Sup Ct J). would be unable to return to work include Lippa v.
11. Smith v. Tamblyn (Alberta) Limited, 1979 CanLII 1036 Can-Cell Industries Inc., 2009 ABQB 684; Antonacci v.
(Alta. QB). Great Atlantic & Pacific Co. of Canada, 1998 CanLII 14734

(Ont. Sup Ct J), varied on other grounds 2000 CanLII 5496 24. See also: Duong v. Linamar Corporation, supra note 15; and
(Ont. CA); Dragone v. Riva Plumbing Limited, supra note Fraser v. UBS, supra note 15.
16; Naccarato v. Costco, 2010 ONSC 2651; Altman v. Steve’s 25. Hydro-Québec v. Syndicat des employé-e-s de techniques pro-
Music, 2011 ONSC 1480; White v. Woolworth (F. W.) fessionnelles et de bureau d’Hydro-Québec, section locale
Canada, 1996 CanLII 11076 (Nfld. CA); and Bishop v. 2000 (SCFP-FTQ), 2008 SCC 43. An example of a typical
Carleton Cooperative Ltd. (1996), 21 CCEL (2d) 1 (NBCA). statutory requirement to accommodate employee disability
20. In McRae v. Dodge City Auto (1984) Ltd., supra note 14, is found in s. 17 of the Human Rights Code, RSO 1990,
frustration of contract was found when an employee had c. H.19.
been absent for less than three months due to illness, but 26. Canadian Charter of Rights and Freedoms, Part I of the Con-
the court was persuaded that the disability was permanent. titution Act, 1982, being Schedule B to the Canada Act 1982
21. G.H.L. Fridman, The Law of Contract in Canada, 4th ed (UK), 1982, c. 11, s. 15(1). See Eldridge v. British Columbia
(Scarborough, ON: Carswell, 1999) at 677. (Attorney General), [1997] 3 SCR 624; Ontario Nurses’ Asso-
22. Davis Contractors Ltd. v. Fareham Urban District Council, ciation v. Mount Sinai Hospital, 2005 CanLII 14437 (Ont.
supra note 1; St. John v. TNT Canada Inc., supra note 12; CA) (the section of the Ontario Employment Standards Act
O’Connell v. Harkema Express Lines Ltd., 1982 CanLII 3198 that excludes from severance pay employees whose contract
(Ont. Sup Ct J); and Polyco Window Manufacturers Ltd. v. has become frustrated violated Section 15 of the Charter).
Saskatchewan (Director of Labour Standards), supra note 7. 27. See Wightman Estate v. 2774046 Canada Inc., supra note 1
23. See England, supra note 3 at 421: “If an employee absent at paras 55-56.
because of sickness is entitled to and is in receipt of long- 28. A human rights tribunal may accept that a contract was
term disability benefits under an employment contract, the frustrated by an employee disability and was therefore not a
contract almost certainly cannot be regarded as frustrated, violation of the statutory duty to accommodate, but it must
since the parties will have foreseen the alleged frustrating first assess whether accommodation would have been pos-
event and have expressly contracted for it.” See also sible. See Barboutis v. Singer Valve, 2012 BCHRT 244; Senyk
Antonacci v. Great Atlantic & Pacific Co. of Canada, which v. WFG Agency Network (No. 2), 2008 BCHRT 376; and
varied on other grounds, supra note 19. Gahagan v. James Campbell Inc., 2014 HRTO 14.


C H A P T E R 12
Summary Dismissal: Termination

for Cause Without Notice
II. The Basic Legal Principles Applied to Summary Dismissal Cases 180
• Define summary dismissal in the context of
A. The Proportionality Test: McKinley v. BC Tel 180
the common law of the employment
B. Can the Employer Rely on Evidence of Employee Misconduct Learned After the
contract. Decision to Terminate the Employee? 182
• Identify the factors that an employer must establish to C. Single Wrongful Acts Versus “Cumulative Just Cause” 183
prove grounds for summary dismissal. D. Employer Condonation of Employee Misconduct 185
• Describe the principle of proportionality applied by E. Specific Penalty Clauses in Contracts 185
the courts to determine whether cause for summary III. Common Grounds for Summary Dismissal 185
dismissal exists. A. Dishonesty and Conflict of Interest 186
• Describe the difference between cause based on a B. Gross Incompetence and Safety Violations 186
single isolated incident of wrongdoing and cumulative C. Breach of Faithful Service to the Employer 186
just cause. D. Insubordination and Insolence 188
• Explain how the law of summary dismissal is applied E. Harassment 188
to the most common forms of employee misconduct. F. Violence and Threats of Violence 190
• Research and understand case law dealing with G. Absenteeism and Lateness 190
summary dismissal arguments. H. Off-Duty Conduct 191
I. Inappropriate Use of Employer Technology 192
J. Intoxication at Work 193
Exercise 195
I. Introduction
Imagine that Mitchell, an employee, steals thousands of dollars from his employer. The employer
dismisses Mitchell and calls the police to have criminal charges laid. However, a term in Mitch-
ell’s employment contract entitled him to notice of termination and says nothing about whether
that requirement is waived if he steals money. Should Mitchell still be entitled to notice? Or has
he forfeited that entitlement by stealing from his employer?
We learn in this chapter that employers can terminate an employee’s employment contract
without notice when the employee commits a serious, or fundamental, breach of contract. This
type of termination of an employment contract is known as summary dismissal for cause. The
179

Ontario Court of Appeal explained summary dismissal in the 1967 case of R v. Arthurs,
Ex p. Port Arthur Shipbuilding Co.:
If an employee has been guilty of serious misconduct, habitual neglect of duty, incompetence, or
conduct incompatible with his duties, or prejudicial to the employer’s business, or if he has been
guilty of wilful disobedience to the employer’s orders in a matter of substance, the law recognizes the
employer’s right summarily to dismiss the delinquent employee.1
Since summary dismissal requires a fundamental breach of a term of the employment con-
tract, the implied contract terms we learned about in Chapter 9 play a starring role in the law
of summary dismissal. You might want to do a quick refresher of what those terms were, because
employers often rely on them as the basis for their decision to summarily dismiss an employee.
Of course, breach by an employee of an expressed (written) contract term can also give rise to
summary dismissal.
The issue of whether an employer had cause for summary dismissal usually arises in a
wrongful dismissal suit filed by the employee. The employer will defend the employee’s claim
of damages for failure to give notice of termination by arguing that it had cause and therefore
was not required to give notice. It falls to judges to determine whether cause exists. Over the
years, the courts have decided hundreds of these cases; entire books have been written sum-
marizing the decisions.2 The objective of this chapter is to explain a basic framework that will
allow you to assess whether an employee’s misconduct is likely to result in cause for summary
dismissal.
II. The Basic Legal Principles Applied to Summary

Dismissal Cases
Summary dismissal extinguishes the employee’s entitlement to notice of termination and
hence has been described as the “capital punishment” of employment law.3 Recall from
Chapter 11 that a policy rationale for requiring employers to provide notice of termination is
to ensure employees have time to plan for the loss of their job. An employee dismissed for
cause loses that important benefit. In addition, being terminated for cause can tarnish the
employee’s reputation and make finding new employment more difficult. It can also disqualify
the employee from receiving unemployment insurance benefits (see the online chapter, “Regu-
lating Unemployment”).
Because of the harsh ramifications for employees, and in contrast to the approach of judges
in the 19th and early 20th centuries, modern courts have developed a relatively high threshold
for finding summary dismissal.4 Judicial recognition that employees are often in a vulnerable
position (as discussed in Chapter 10) has coloured the approach to summary dismissal, as we
will see. If the employer fails to persuade the court that it has cause for summary dismissal, the
court will rule that a wrongful dismissal has occurred and order the employer to pay damages
according to the rules we will consider in Chapter 14. Let’s now consider the basic elements of
the law of summary dismissal.
A. The Proportionality Test: McKinley v. BC Tel

The leading case setting out the modern approach to summary dismissal is described in
Box 12.1. The case involved alleged employee dishonesty, but the test applied by the Supreme
Court of Canada is now applied to all forms of employee misconduct.

Chapter 12 Summary Dismissal: Termination for Cause Without Notice 181

When Is Dishonesty Grounds for Summary Dismissal?
McKinley v. BC Tel I am of the view that whether an employer is justi-
2001 SCC 38 fied in dismissing an employee on the grounds of
dishonesty is a question that requires an assessment
Key Facts: McKinley suffered from high blood pressure, and of the context of the alleged misconduct. More spe-
his doctor instructed him to take a leave from work. The doctor cifically, the test is whether the employee’s dishon-
subsequently told him he could return to work if he took a esty gave rise to a breakdown in the employment
drug known as a “beta blocker.” McKinley did not disclose this relationship. This test can be expressed in different
option to his employer, BC Tel, and instead asked his employer ways. One could say, for example, that just cause for
to accommodate him in a less stressful job. The employer dismissal exists where the dishonesty violates an
declined to offer an alternative job and instead terminated essential condition of the employment contract,
McKinley’s employment contract without notice. McKinley breaches the faith inherent to the work relationship,
sued for wrongful dismissal. At trial, the employer argued that or is fundamentally or directly inconsistent with the
it had cause to dismiss McKinley because he had not disclosed employee’s obligations to his or her employer.
the doctor’s advice to return to his old job while taking the
beta blocker. The Supreme Court noted that it was applying a “principle
Issue: Did McKinley’s failure to disclose the option of returning of proportionality” that requires the courts to strike a balance
to work using the beta blocker drug amount to dishonesty “between the severity of an employee’s misconduct and the
sufficient to justify summary dismissal without notice? sanction imposed.” Here, while McKinley was not completely
straightforward with the employer, his actions did not rise to
Decision: No. This dishonesty was not sufficiently serious to the level of dishonesty inconsistent with the employment
constitute cause for summary dismissal. The Supreme Court relationship. McKinley was awarded wrongful dismissal dam-
of Canada rejected a line of earlier cases* in which the courts ages based on a long period of 26 months’ reasonable
found that any dishonesty by an employee, no matter how notice.
trivial, was cause for summary dismissal. It noted that employ-
ees derive a “sense of identity and self-worth [as] individ- * Authority for the position that any employee dishonesty amounts to
uals … from their employment” and are “in a vulnerable cause for summary dismissal, rejected by the Supreme Court in the
position vis-à-vis their employers.” This fact should influence McKinley decision, includes Boston Deep Sea Fishing Co. v. Ansell, [1888]
how judges approach summary dismissal. An employee’s con- 39 Ch. D 339 (CA); and McPhillips v. British Columbia Ferry Corporation,
1994 CanLII 6416 (BCCA).
duct should be assessed in a broader context, according to
the decision:
The contextual or “proportional” approach applied by the Supreme Court in McKinley

requires the courts to apply a two-step test. The key legal principles applied in summary dis-
missal cases are summarized in Box 12.2. First, the courts decide whether the evidence estab-
lishes that the employee engaged in misconduct of some sort in breach of an implied or
expressed term of the contract. In this task, the courts apply the standard of a balance of prob-
abilities, which means essentially that the evidence confirms it is more likely than not that the
employee committed the wrongful act.5
Second, if the court finds that the employee breached the contract, then it assesses the seri-
ousness of the misconduct to determine whether summary dismissal was warranted. In McKin-
ley, the Supreme Court described this part of the test as an assessment of whether the employee’s
actions “gave rise to a breakdown in the employment relationship.” In other cases, judges have
asked whether the employee’s actions were “such a violation of trust that a continuing relation-
ship [is] impossible.”6 Still other judges have said that the test is whether the employee’s actions
amount to a repudiation of the contract as a whole or of an “essential term” of the contract.7
balance of probabilities: An evidentiary standard of proof requiring evidence that it is more likely than not that an incident
occurred.


Summary of the Law of Dismissal for Cause (Summary Dismissal)
The courts apply a principle of proportionality to determine reputational harm will be found to meet the standard for
cause for summary dismissal: “in all the circumstances” is dis- summary dismissal. The courts consider all of the circum-
missal without notice an appropriate sanction given the nature stances that surround the employee’s misconduct (mitigating
of the employee’s breach of contract?* This approach involves circumstances or factors), including elements such as the
a two-step test: employee’s length of service and past record, premeditation,
provocation, the employee’s personal circumstances, and
Step One any other circumstances that might explain the employee’s
Did the employer establish on a “balance of probabilities” that behaviour.
the employee breached the contract? If the court answers the questions in steps one and two in
the affirmative, then the employer is relieved of the obligation
The employer can rely on evidence of employee misconduct to provide notice of termination to the employee. However, if
learned after the employee was dismissed to answer this the answer at either step one or step two is negative, then the
question. employer will fail in its attempt to prove cause for summary
dismissal. In that event, the court will assess how much notice
Step Two
of termination should have been given to the employee and
Is the employee’s misconduct sufficiently serious that it under- calculate damages owing to the employee based on that as-
mines the foundation of the employment contract? sessment. The calculation of damages for wrongful dismissal
is considered in Chapter 14.
This second question is sufficiently malleable that it affords
judges considerable discretion. In general terms, only serious
employee misconduct that causes employers economic or * See McKinley v. BC Tel, 2001 SCC 38.
In practice, not much turns on how the test is described.8 Essentially, the courts ask whether
the employee’s misconduct was so serious that the employment relationship has been irrepara-
bly undermined. In assessing this question, the courts look at all of the circumstances, including
the seriousness of the misconduct and the harm to the employer’s business interests, as well as
other mitigating factors, such as the employee’s past employment record and length of service,
whether there was provocation, whether the employee was experiencing personal or physical
difficulties at the time, whether the wrongful act was premeditated and planned or just a poor
spur of the moment decision, and whether the employer had ignored the misconduct in ques-
tion in the past.
B. Can the Employer Rely on Evidence of Employee Misconduct Learned

After the Decision to Terminate the Employee?
Imagine that our employee, Mitchell, is dismissed without notice, and he files a wrongful dis-
missal lawsuit. The employer originally alleged poor performance as the cause. However, prior
to the trial, the employer discovers that Mitchell had stolen money from the employer in the
weeks before his dismissal. Mitchell’s poor performance would not alone have been serious
enough to justify summary dismissal without notice, but the theft sure would be. At the trial,
principle of proportionality: The test applied by the courts in summary dismissal cases that assesses whether the termin-
ation of an employee’s contract without notice is an appropriate response to the employee’s misconduct, considering all of the
relevant facts.
mitigating circumstances/factors: Personal or workplace-related factors that, while not directly the cause of an employee’s
behaviour, help explain or justify an employee’s behaviour.

can the employer change the reason for the termination from poor performance to theft, even
though theft was not the reason Mitchell was initially fired?
The courts have said that the employer can do just that.9 The logic is that an employee’s fun-
damental breach of contract grants an employer the right to refuse to comply with its obligation
to give notice, so it matters not that the employer only learns of that breach later on. Also, from
a policy perspective, if an employee could avoid summary dismissal by concealing their miscon-
duct, then the law would reward employees for their dishonesty. The Ontario Court of Appeal
described this rule way back in 1889:
It is now settled law that if a good cause of dismissal really existed, it is immaterial that at the time
of dismissal the master did not act or rely upon it, or even did not know of its existence, or that he
acted upon some other cause in itself insufficient. The main question always is, were there at the time
of the dismissal facts sufficient in law to warrant it.10
The fact that the employer can rely on new facts learned after the decision to dismiss the em-
ployee creates an incentive for employers to keep investigating the employee right up to the date
of the trial.
C. Single Wrongful Acts Versus “Cumulative Just Cause”

A single breach of contract by an employee can meet the test for summary dismissal, but the
incident must be very serious or a wilful breach of contract. For example, an outright refusal
by the employee to perform their job may be treated as a fundamental breach of the contract
that the employer may treat as having brought the contract to an end with no obligation on the
employer to provide notice of termination.11 A single wrongful act that strikes at the foundation
of the relationship of trust between employer and employee (e.g., theft, fraud, violations of pri-
vacy or confidentiality, secretly competing against the employer) may also constitute cause for
summary dismissal, as can single serious acts of violence, harassment, or violations of safety
rules that put employees or others at risk, as demonstrated in the case described later in
Box 12.4.12
While a single serious incident can lead to summary dismissal, often employers rely on an
accumulation of less serious employee misconduct (rather than a single wrongful act), which is
known as cumulative just cause.13 A breach of contract that alone would not be cause for sum-
mary dismissal can serve as the proverbial straw that breaks the camel’s back if the employee has
committed prior breaches of contract. That final breach of contract—the proverbial straw—is
known as the culminating incident.14
The courts have applied the cumulative just cause doctrine cautiously. For an employer to win
an argument based on cumulative cause, it must persuade the court that
1. the employee was given clear and express warnings about their performance;
2. the employee was given a reasonable opportunity to improve after the warnings;
3. the employee failed to improve notwithstanding being given a fair chance; and
4. the cumulative failings of the employee prejudiced the employer’s business.15
wilful breach of contract: A deliberate, defiant, or premeditated violation of the requirement(s) of a contract.
cumulative just cause: Grounds for summary dismissal based on an accumulation of wrongful acts by an employee over a
period of time.
culminating incident: The final breach of contract by an employee following progressive discipline that the employer relies
on to justify termination of an employee for cause.

This test imposes on employers a duty to warn an employee if the employer intends to rely
on cumulative just cause and to provide the employee with a period of time to alter their behav-
iour.16 The duty to warn incorporates a “corrective theory” of discipline based on the notion that
employers should attempt to correct performance problems by progressive discipline before
jumping to the ultimate sanction of termination without notice.17 For this reason, the presence
and consistent application of a progressive discipline policy will improve the likelihood of sum-
mary dismissal based on cumulative cause being upheld by a court.18 Box 12.3 examines the
origins of the duty to warn in the common law model.

Internal Feedback Loop: How Collective Bargaining Law Influences the Common Law Regime:
Progressive Discipline
In Chapter 2 we noted that while the three regimes of work Nevertheless, in recent years common law judges have
law are distinct legal systems, they also occasionally influence gazed into the collective bargaining regime to see how labour
one another through an internal feedback loop. Legal princi- arbitrators have applied progressive discipline. Some judges
ples developed in one regime can be adopted in whole or in have liked what they have seen. How did this occur?
part in another regime. An example of this influence can be In the 2004 case of Cabiakman v. Industrial Alliance Life In-
seen in the application of progressive discipline in the com- surance Co., the Supreme Court considered whether an em-
mon law regime. ployer governed by Quebec civil law could suspend an
We will learn in Part IV that discipline and termination employee without pay. In that context, the Supreme Court
disputes in unionized workplaces are heard by labour arbitra- stated, “There are factors that have been developed in the
tors and not courts. Almost every collective agreement (the decisions of labour arbitrators that can guide the courts in
employment contract for unionized workers) includes a term determining whether an employer was justified in deciding to
providing that the employer can only discipline or dismiss an temporarily suspend an employee against whom criminal
employee if there is “just cause.” Over the years, in interpreting charges had been laid.”†
“just cause” provisions, labour arbitrators have developed a The next year, an Alberta judge (who was formerly a labour
doctrine of “progressive discipline,” which requires employers lawyer who litigated collective agreement disputes before
to apply lesser forms of discipline (warnings, suspensions) labour arbitrators) referenced that passage in a decision on
before terminating an employee’s employment contract. This whether an employee was unjustly dismissed for summary
arbitral case law forms an important output of the collective dismissal. In Henson v. Champion Feed Services Ltd., Justice
bargaining regime. Sheila Greckol wrote the following:
Hardly any non-union employment contracts include “just
The Supreme Court of Canada has recently affirmed
cause” requirements. Therefore, labour arbitration law has no
that it is appropriate for courts to look to the
obvious or direct relevance to the common law of the non-
decisions of labour arbitrators for guidance on
union employment contract. In fact, in the case of McGavin
the application of principles within their familiar
Toastmaster Ltd. v. Ainscough, the Supreme Court of Canada
terrain.‡
explained that the common law and the collective bargaining
regimes are distinct, and the rules of termination in one have Justice Greckol then examined the “theoretical basis for
no application to the rules in the other.* the progressive discipline approach” in labour arbitration
duty to warn: A requirement in both the common law and collective bargaining law regimes for employers to warn
employees that their behaviour or performance is unacceptable and to give them a reasonable opportunity to correct their
performance.
progressive discipline: The application in stages by employers of progressively more serious discipline to correct performance
problems.

jurisprudence, citing labour arbitration decisions. Arbitrators courts in assessing whether employers have cause for summary
have recognized that progressive discipline is a “fair” system dismissal.§
that provides an employee with a warning and a chance to
improve before being dismissed. Justice Greckol ruled that an * McGavin Toastmaster Ltd. v. Ainscough, [1976] 1 SCR 718.
employer relying on a cumulative breach to justify summary † Cabiakman v. Industrial Alliance Life Insurance Co., [2004] 3 SCR 195 at
dismissal must demonstrate that it first applied progressive para 64.
discipline. See also the earlier decision in Riehl v. Westfair Foods ‡ Henson v. Champion Feed Services Ltd., 2005 ABQB 215 at para 53.
Ltd., where the court noted that the “corrective theory” de-
§ Riehl v. Westfair Foods Ltd., 1995 CanLII 6086 (Sask. QB). See also Barton v.
veloped initially by labour arbitrators has been adopted by the Rona Ontario Inc., 2012 ONSC 3809.
D. Employer Condonation of Employee Misconduct

An employer that learns of an employee’s misconduct but then allows an extended period of
time to pass without sanctioning the employee may be prohibited from relying on that miscon-
duct as the basis for summary dismissal. The courts call this condonation of the employee’s
breach of contract. There is no precise amount of time that can pass between the wrongful
behaviour by the employee and the termination before a court will rule that the employer con-
doned the employee’s actions. The court will consider all of the circumstances and decide
whether the employer acted within a reasonable period of time.19 Misconduct that is condoned
by the employer can still be considered if the employer later terminates the employee based on
cumulative cause, provided that the employee engages in new misconduct—a new culminating
incident—after the initial wrongful act.20
E. Specific Penalty Clauses in Contracts

The discussion in this chapter so far assumes that the contract itself does not expressly define
what constitutes cause for dismissal without notice. It is possible for a contract to include a
specific penalty clause that determines what sorts of employee misconduct will constitute cause
for dismissal without notice.21 For example, a contract might state that any theft, regardless of
the amount, is cause for immediate termination without notice. Provided the contract language
is clear and unambiguous, the effect of a specific penalty clause would be to oust the common
law rules pertaining to cause for summary dismissal that we are discussing in this chapter.22 Few
reported decisions involve the application of specific penalty clauses; relatively few employment
contracts include them, and it may be that few employees challenge their employer’s application
of those clauses.
III. Common Grounds for Summary Dismissal

The preceding section provided an overview of the basic legal principles that are important in
summary dismissal cases. Whenever an employer argues as its defence in a wrongful dismissal
lawsuit that it had grounds for summary dismissal, the courts apply the proportionality test used
in the McKinley decision, described above. Now let’s consider specific types of employee behav-
iour that can cause an employer to terminate the contract for cause.
condonation: When a party that could have treated the employment contract as having been repudiated (terminated) by the
other party’s breach of the contract elects not to treat the contract as being repudiated.
specific penalty clause: A term in a contract that defines the penalty that will result as a consequence of a specified breach
of contract by one of the parties.

A. Dishonesty and Conflict of Interest

We have already considered dishonesty as a ground for summary dismissal in the McKinley de-
cision (Box 12.1). We learned that while dishonesty is considered to be a serious wrong, not
every dishonest act gives the employer grounds for summary dismissal. The courts assess the
context and seriousness of the dishonesty in deciding whether it has irreparably undermined
the trust necessary in an employment relationship.23 In applying this standard, the role of the
employee in the business is relevant. Employees who work with significant autonomy and who
are in positions of authority or positions requiring special trust (such as bank employees) are
often held to a higher standard of ethical behaviour than are employees who are not in such
positions.24
Theft and fraud are particularly serious forms of dishonesty, and if a court finds that an em-
ployee committed premeditated theft or deliberately schemed to defraud the employer or a
customer, summary dismissal is the likely outcome.25 However, the employer must establish that
the theft or dishonesty was intentional and not the result of innocent oversight or a mistaken
belief that the behaviour in question was permissible.26 Other forms of intentional employee
dishonesty can also give rise to summary dismissal as a breach of the implied obligation of fidel-
ity and honesty (see Chapter 9), such as time theft and lying to the employer (including during
the recruitment process, as we noted in Chapter 6).27 However, whether such actions will lead
to summary dismissal depends on the degree of dishonesty involved, as well as other mitigating
circumstances.
B. Gross Incompetence and Safety Violations

A duty to perform one’s job competently and safely is an implied term of every employment
contract, as we learned in Chapter 9, and in some cases it is also required by an expressed con-
tract term. However, simply being a substandard employee is not grounds for summary dis-
missal. The courts have used the phrase gross incompetence to describe the standard necessary
to justify summary dismissal.28 A single act of incompetence can meet this standard if it is par-
ticularly egregious or constitutes a serious violation of safe work practice that is known to the
employee, as demonstrated in the decision in Box 12.4.29
Often employers that assert cause of dismissal based on incompetent performance rely on
cumulative just cause, discussed earlier. The “duty to warn,” mentioned above, is crucial in these
cases, as the decision discussed in Box 12.5 demonstrates.30
C. Breach of Faithful Service to the Employer

Another implied contract term considered in Chapter 9 requires employees to act in furtherance
of the employer’s economic interests. This term includes a duty of faithful service to the em-
ployer and a prohibition on competing with the employer. Breaches of these duties can give rise
to summary dismissal. For example, the courts have found cause for summary dismissal where
employees secretly engaged in competition with their employer or took secret profits from the
employer by not reporting income.31 The obligation of faithful service is a flexible concept,
granting judges considerable latitude to decide what sorts of employee conduct it governs. In
the Middelkoop v. Canada Safeway Limited case, the summary dismissal of a retail store manager
who violated a company policy prohibiting employees from purchasing marked-down products
was upheld. The employee claimed he was not aware of the policy. The Manitoba Court of
time theft: When an employee falsely claims wages for time not actually worked.
gross incompetence: A level of employee performance that falls far below that expected of a reasonably competent
employee.

Appeal ruled that the employee’s failure to learn the policies—and his “tuning out” of a sub-
ordinate who warned him his actions were in breach of the policy—violated the “obligation of
faithful service,” which was an essential condition of all employment contracts.32

Violation of Safety Rules Gives Employer Grounds for Summary Dismissal
Balzer v. Federated Co-operatives Limited himself, others, and the environment. Balzer sued for wrong-
2018 SKCA 93 ful dismissal.
Key Facts: Balzer was terminated for cause without notice Issue: Did the employer have cause for summary dismissal
after six years’ employment for serious violations of the based on the violation of several safety rules during the pro-
employer’s safety rules. Balzer had no prior discipline. Balzer pane leak incident?
had received extensive safety training as a propane coordi-
Decision: Yes. The court cited the McKinley decision for the
nator and knew violating the safety rules could lead to ter-
point that the penalty must be proportional to the employee’s
mination. One morning, while filling his truck with propane,
wrongful acts. Balzer’s actions violated known safety protocols
Balzer violated several safety rules and as a result propane
and the resulting discharge of propane created an emergency
escaped into the air for nearly 30 minutes discharging an
situation that Balzer did not take sufficiently seriously, as con-
estimated 5,000 litres of propane into the environment. Dur-
firmed by his casual response, including taking a one-hour
ing the leak, Balzer left the property to find a wrench, leaving
lunch during the ordeal and not reporting the leak to author-
the gate unsecured. He did not report the leak to police, fire
ities as require by safety protocols. The court did not find any
services, or management until a long period had passed.
mitigating circumstances that would explain or justify Balzer’s
When the leak stopped, Balzer left for an hour lunch without
breach of several important safety rules. Even though the
reporting the problem to management, even though there
cause of the termination related to a single incident in an
continued to be a risk that the leak could resume. The
otherwise good six-year work record, the court found that
employer terminated Balzer for cause on the basis that Bal-
Balzer’s actions were sufficiently serious to justify a finding of
zer had violated five safety rules causing a serious risk to
cause for summary dismissal.

Incompetence as Cause for Summary Dismissal
Babcock v. C. & R. Weickert Enterprises Ltd. Decision: No. The court of appeal found that, in order to
1993 CanLII 3112 (NSCA) establish cause for summary dismissal, the onus was on the
employer to demonstrate that (1) Babcock was duly warned
Key Facts: Babcock was hired as manager of a Canadian Tire that his performance must improve or his services would be
store in April 1990. The store did well under his management. terminated; (2) Babcock understood the warning; and (3)
However, in October 1990 the owner of the store received a Babcock was given a reasonable opportunity to rectify his
report from an external consultant indicating that other senior performance deficiencies. While both (1) and (2) were satis-
employees had “lost confidence” in Babcock. The employer fied, the employer failed to demonstrate that Babcock had
confronted Babcock with this allegation and emphasized the been given a reasonable time to improve. Only about two
need for Babcock to address the problems. The employer told months passed between the time Babcock was warned and
Babcock that his performance would be reviewed in the new his dismissal, and that included the busy Christmas rush
year. Babcock took a vacation in early January 1991. At a man- period during which Babcock would not have been able to
ager’s meeting held in Babcock’s absence, it was agreed that take additional training. Moreover, the fact that the em-
Babcock was not performing his job adequately and that he ployer had initially decided to give Babcock a 45-day period
would be given a 45-day period to improve. However, when to improve supported the conclusion that Babcock was not
he returned several weeks later, Babcock was dismissed. given a reasonable time to improve. Babcock was award-
Issue: Did the employer have cause to summarily dismiss ed damages based on a period of five months’ reasonable
Babcock for incompetence? notice.

D. Insubordination and Insolence

It is an implied (if not expressed) term of every employment contract that the employee will
obey lawful employer directions. A breach of this term is known as insubordination.33 As noted
above, a court is likely to find that an employee’s absolute refusal to perform the core functions
of the job amounts to a repudiation of the contract that demonstrates an intention by the em-
ployee to treat the contract as at an end. In that case, an employer can simply treat the contract
as over and provide no notice to the employee.
However, short of an absolute refusal to perform the core functions of their job, not every act
of employee insubordination will be grounds for summary dismissal. That is the lesson that
flows from the McKinley proportionality test discussed earlier. For insubordination to amount
to cause for summary dismissal, it must involve a serious issue, be wilful, and demonstrate a
defiant refusal to respect a clear and unambiguous order that was within the authority of the
employer to make.34 But even an act of wilful disobedience by an employee will not be grounds
for summary dismissal if it involves a relatively minor transgression or the employee had a “rea-
sonable excuse” for not complying, such as a concern that the order was unlawful or that com-
plying with it could expose the employee to harm.35 A less serious incident of insubordination
that would not alone constitute cause for dismissal may nevertheless serve as the culminating
incident warranting the dismissal of an employee who has been previously warned about their
substandard performance.36
Employees must also avoid insolence, which involves vocal defiance such as verbal abuse or
insults directed at the employer. Usually a single act of insolence will not amount to cause for
summary dismissal;37 however, it may do so when it is so egregious that it effectively destroys
the possibility of the employment relationship continuing or seriously harms the employer’s
economic interests.38 Insolence is most likely to meet that latter standard when it occurs in front
of other employees or customers and involves profanities, as that behaviour undermines the
authority of the employer.39 The decision discussed in Box 12.6 demonstrates how the courts
treat insolence as grounds for summary dismissal.
E. Harassment
Employees are prohibited from harassing co-workers or customers either by expressed con-
tract terms or by virtue of an implied term. Work-related sexual and racial harassment in
particular are treated as serious employment offences that can give rise to cause for summary
dismissal, but other forms of harassment and bullying are also serious.40 However, harass-
ment, even of a sexual or racial nature, is not always grounds for summary dismissal. Once
again, context matters. Harassment by a person in a position of authority is more likely to
justify summary dismissal, even if it is an isolated incident, recognizing the power dynamic,
the legal duty of the employer to prevent workplace harassment, and the vulnerability of the
victims (see the decision examined in Box 12.7).41 On the other hand, relatively minor harass-
ment may warrant a warning but not termination for cause, especially if evidence exists that
the harassers did not realize their behaviour was offensive and they are contrite once informed
that it is.42
insolence: An overt expression of defiance by an employee to the authority of the employer.


Insolence as Cause for Summary Dismissal
Henry v. Foxco Ltd. manage the workforce; or (3) when the incident caused the
2004 NBCA 22 employer material financial or reputational loss. None of these
circumstances existed in this case:
Key Facts: Henry was fired for insubordination and insolence
after seven years of employment with Foxco Ltd. One day, [The employer] did not establish that Mr. Henry’s
Henry’s supervisor, Graham, asked Henry why he was taking insolence led to irreparable harm to the working
so long to remove decals from a vehicle and told him to hurry relationship. Specifically, [it] did not establish that
up. Henry became belligerent and asked Graham what his this isolated incident rendered it impossible or im-
problem was. Graham responded by telling Henry that he practicable for Mr. Henry and Mr. Graham to main-
could quit if he was not happy. To that, Henry yelled, “If you tain a working relationship. …
want to fire me, go ahead,” repeating this line multiple times. There is no evidence to suggest that the verbal
Finally, Graham said, “Okay, you’re fired.” Henry sued for wrong- confrontation had a prejudicial effect on Mr. Gra-
ful dismissal. ham’s ability to supervise the work place effectively
Issue: Did Henry’s behaviour amount to cause for summary or that [the employer’s] financial or business inter-
dismissal? ests were prejudiced as a result of the incident. …
Many things are said and done in the heat of the
Decision: No. The court of appeal noted that a single, isolated moment that, on reflection, are regretted by all. This
case of insolence will justify summary dismissal only under is one of those cases.
three circumstances: (1) when it destroys the ability of the
employee and supervisor to maintain a working relationship; Henry was entitled to damages based on an assessment of
(2) when the incident undermined the supervisor’s ability to six months’ reasonable notice.

Sexual Harassment by a Manager
van Woerkens v. Marriott Hotels of Canada Ltd. Issue: Did VW sexually harass M and, if so, was this behaviour
2009 BCSC 73 grounds for summary dismissal without a warning?
Key Facts: van Woerkins (VW) was employed as a director of Decision: Yes, the employer had grounds to terminate VW
sales and marketing. He had worked for Marriott for 22 years without notice. VW had committed two serious employment-
with no discipline. In December 2006, VW attended the com- related offences. First, VW had followed an obviously drunk
pany’s holiday party in Vancouver where he was expected to and vulnerable subordinate employee into the bathroom
monitor alcohol consumption by employees and protect the where he touched her in an inappropriate manner and after-
company’s interests, including ensuring employees did not wards attempted to contact her “for the purposes of determin-
become too inebriated. A female employee, M, became very ing whether there was an opportunity to pursue a sexual
drunk. After the company function, a group of employees in- relationship with her.” This behaviour constituted serious
cluding M retired to a hotel room to continue an “after party.” sexual misconduct by a manager in a position of power.
VW attended and followed M into a bathroom where he Second, when confronted with M’s allegations, VW was
groped her. A couple of weeks’ later, VW phoned M at work dishonest in denying that he went into the bathroom with M,
and invited her to meet him at a nearby bar to have their even though there were witnesses. This dishonesty under-
“special meeting.” M declined the invitation and reported the mined the employer’s trust in VW. The fact that the employer
incidents to senior management. Management did an inves- had a “progressive discipline” policy does not prevent the
tigation and concluded that VW had sexually harassed M and employer from terminating VW without a record of prior warn-
that the behaviour was sufficiently serious to provide grounds ings. Serious misconduct that involves dishonesty and sexual
for immediate summary dismissal. VW denied that he had fol- harassment can create grounds for immediate termination.
lowed M into the bathroom or touched her inappropriately. That was the case here.
He sued for wrongful dismissal.

F. Violence and Threats of Violence

Acts of violence in the workplace are considered a serious breach of the employee’s obligations,
and a single act of workplace violence can give rise to summary dismissal.43 So too can threats
of physical violence made against an employee or the employer.44 However, in keeping with the
proportionality test, the courts will also consider mitigating factors that might have contributed
to the employee’s actions. A single incident of violence by an employee with an otherwise clean
disciplinary record may not be cause for summary dismissal, especially if the incident was pro-
voked in some manner. For example, in Shakur v. Mitchell Plastics, no cause existed for summary
dismissal when an employee slapped a co-worker in the face after a verbal confrontation. Apply-
ing the proportional approach, the court ruled that the incident was a momentary outburst by
an otherwise good employee with six years’ service and no prior disciplinary problems. A warn-
ing or other lesser form of discipline would have been sufficient, the court ruled.45
G. Absenteeism and Lateness

There is an important difference in the law of work between “culpable” and “non-culpable”
absenteeism and lateness. A non-culpable absence, known as innocent absenteeism, is one in
which the employee is not blameworthy, such as absence due to a disability or religious reasons.
An employee cannot be disciplined for innocent absenteeism since they are not at fault. How-
ever, as explored in Chapter 11, an employer may still terminate the contract of an employee
based on the doctrine of frustration of contract if it can demonstrate to a court that the em-
ployee has (1) already been absent for a long period of time and (2) the medical evidence dem-
onstrates that the employee is unlikely to be able to return to work in the foreseeable future.46 If
a court finds that either of those two conditions have not been established, then it will order the
employer to pay the employee damages based on the required period of notice even though the
employee was not able to work due to disability during the notice period.47
A key point to understand at this juncture of the book is that when an employee’s absenteeism
is due to a reason covered by human rights legislation, including disability, religion, and in some
cases family status, then the regulatory regime considered in Part III of this text intervenes in
the common law right of the employer to terminate the employee by giving notice. Human
rights statutes impose a duty to accommodate on the employer as a precondition to terminating
an employee for innocent absenteeism. We explore the duty to accommodate in Chapter 23.
When the absenteeism or lateness is unrelated to protected human rights’ grounds, the
courts’ approach is similar to that which we have already seen. As per the McKinley proportion-
ality test, the courts consider all of the circumstances and decide if summary dismissal is a
proportional response to the employee’s absenteeism. Most employers making a case for sum-
mary dismissal based on tardiness attempt to build a record of prior problems accompanied by
clear warnings and a reasonable opportunity for the employee to correct the problem. The
approach is similar to that taken with respect to incompetence. The courts expect employers to
warn employees that their tardiness is unacceptable and to clearly explain that termination will
result if the problem is not corrected. An employee who receives clear warnings that continued
tardiness will result in termination and does not improve risks the court finding cause for sum-
mary dismissal.48
innocent absenteeism: An employee’s absence from work due to reasons that are not blameworthy, such as illness, disability,
or religious observance.
frustration of contract: The termination of a contract caused by an unforeseen event that renders performance of the contract
impossible.
duty to accommodate: A legal requirement in human rights law to take steps to remove discriminatory barriers to employ-
ment, including altering schedules, rules, or work patterns or changing the physical design of a workplace.

Although being absent or late without permission is a breach of contract, a single incident of
either would rarely constitute cause for summary dismissal unless accompanied by some other
form of misconduct.49 For example, if an employee fails to come to work in deliberate defiance
of an order to do so, then this may constitute cause, even as an isolated incident.50 Such defiance
violates the contractual prohibition on absenteeism and also amounts to serious insubordina-
tion. Similarly, an employee who lies to the employer about the reason for an absence is violating
the contractual requirement to be honest, as well as being absent without authorization.51 More-
over, persistent absenteeism or lateness combined with other performance problems can
together comprise cause for summary dismissal.52
H. Off-Duty Conduct

The implied obligation of employees to further the employer’s economic interests can reach
beyond the employer’s gates and capture off-duty employee behaviour. That does not mean that
every idiotic thing an employee does during their free time becomes the employer’s business and
exposes the employee to summary dismissal.53 However, when the employee’s off-duty conduct
potentially threatens the employer’s economic interests or the ability of the employee to perform
their job, then it becomes the employer’s business. Therefore, in off-duty conduct cases, the
courts assess whether a nexus (a link) exists between the employee’s behaviour and prejudice to
the employer’s legitimate business interests.54 The strength of that nexus can be related to the
particular job in question. For example, morally questionable behaviour by a teacher or child
counsellor outside of working hours may have a greater negative impact on the employer’s inter-
ests or the employee’s capacity to perform their job than would similar behaviour by a forklift
driver. The decision discussed in Box 12.8 provides an example of a context in which off-duty
conduct is cause for summary dismissal.

Off-Duty Conduct as Cause for Summary Dismissal
Kelly v. Linamar Corporation The [employer] argues that an employee in the
2005 CanLII 42487 (Ont. Sup Ct J) position of Philip Kelly, who is required to work
with the general public both acquiring product
Key Facts: Kelly was a long-service, well-respected manage- from suppliers and supplying product to custom-
ment employee. He was arrested for possession of child por- ers, who is required to manage, instruct and disci-
nography accessed off-hours on his home computer. Linamar pline people working under him, and who is
Corporation, his employer, was very visible in the community, required to interact collegially with many peers at
including in its support for local children’s organizations. The the management level, has a duty to ensure that
arrest was widely reported in local media. The employer dis- his conduct does not adversely impact on any of
missed Kelly, who sued for wrongful dismissal. those activities. It is argued that permitting himself
Issue: Did the arrest of Kelly for possession of child pornog- to be placed in the position where he would be
raphy on his home computer constitute cause for summary charged with possession of child pornography,
dismissal? which fact became almost immediately known to
his management peers, co-workers and people
Decision: Yes. The court noted that the test is whether the who reported to him, and which ultimately became
employee’s behaviour threatened the employer’s business known to the general public when at a later stage
interests. In this case, the morally offensive nature of the mis- the identity of his employer was disclosed, he has
conduct and the “notoriety” it attracted in the local media, failed to discharge the duty that he has to his
combined with the employer’s visible role in the community employer.
as an advocate of children’s activities, created a nexus to the I agree.
employer’s legitimate business interests. The court summar-
ized its decision as follows:

A relatively new area of potential concern for employees is whether comments they make on
social media can be the basis for summary dismissal. The answer, applying the legal principles
just discussed, is that they can if they prejudice the employer’s economic interests, undermine
the employer’s trust and confidence in the employee, or poison the work environment.55 Some
recent media stories discussing employees who have been terminated for off-duty social media
posts are summarized in Box 12.9.

Terminated for Off-Duty Social Media Posts
Many Canadian employees have learned the hard way that they
can be terminated for comments or photos they post on their
social media accounts. Relatively few of these employees have
sued their employers, so there are not yet a lot of decided court
cases exploring terminations for social media posts. However,
we know from other off-duty conduct scenarios that courts will
consider whether the social media posts prejudice the em-
ployer’s legitimate economic and reputational interests or the
ability of the employee to perform their job; in these cases,
summary dismissal may be justified. Consider whether you
think a court would uphold the employer’s decision to summar-
ily dismiss the employees in these two recent news stories.
Sportsnet Television Personality Terminated for

Twitter Post
On-air host Damian Goddard was terminated by Rogers
Sportsnet in 2011 after he tweeted his support for a profes- Damian Goddard.
sional hockey agent named Todd Reynolds, who had criticized
gay marriage. Goddard tweeted: set up to mourn Amanda Todd, a 15-year-old girl who com-
mitted suicide after suffering years of bullying. The employee
I completely and wholeheartedly support Todd wrote, “It’s about time this bitch died.” A reader tracked down
Reynolds and his support for the traditional and the author and found his employer’s name on his Facebook
TRUE meaning of marriage. page. She then informed the employer of the comment. The
employer immediately fired the employee, telling the media
According to a Toronto Star article, Goddard “immediately
that the company has “zero tolerance for the mistreatment of
came under attack. Hours later, Sportsnet was forced to react
others no matter what form it takes.” †
on its main Twitter feed. It ran several replies to angry viewers
repeating the same formula: ‘Today’s tweet from Damian God-
* Kelly, C. “Fired Sportsnet Host Damian Goddard ‘Stands by’ Tweets,”
dard does not reflect the views of Rogers Sportsnet.’” Goddard
Toronto Star (2011), online: <https://www.thestar.com/
tweeted in response that his tweets “reflect the views of Da- sports/2011/05/12/fired_sportsnet_host_damian_goddard_stands
mian Goddard.” The following day, Goddard was terminated.* _by_tweets.html>
† “Negative Amanda Todd Post Costs Man His Job,” CBC News (2012),
Insensitive Facebook Post about Amanda Todd Costs Man online: <https://www.cbc.ca/news/canada/calgary/
His Job negative-amanda-todd-post-costs-man-his-job-1.1134230>
An employee of retailer Mr. Big and Tall was fired after he
posted an offensive comment on a memorial Facebook page
I. Inappropriate Use of Employer Technology

To state the obvious, when employees are at work, they are usually expected to be working.
When they are provided with a computer to perform their work, they are expected to work on
the computer and not surf porn or Facebook. The viewing of pornographic images at work in

particular exposes the employer to liability for allowing a poisoned work environment if the
images can be viewed by other employees. However, given what we have learned so far in this
chapter, it should not surprise you to learn that employee misuse of employer-provided tech-
nology is not always grounds for summary dismissal.
It depends on a number of factors. One is whether the employer has a clear Internet policy
that describes what is and is not permissible. Summary dismissal for viewing or distributing
pornographic material or engaging in non-work-related Internet activity on employer comput-
ers is more likely justified when the employer has a clear policy prohibiting such activities that
is known to the employee and consistently enforced by the employer. In that case, the employee
is engaging in deliberate insubordination.56 The courts also hold employees in managerial pos-
itions to a higher standard, since they are responsible for policing company policies and for
setting a positive example.57 If no clear and explicit policy prohibiting the viewing of pornog-
raphy or using computers for personal use is in place, the courts usually require that the em-
ployee be warned before a dismissal for cause will be upheld. This requirement is especially
relevant if the material viewed by the employee is, according to one judge, “perfectly legal adult
pornography,” meaning that it is not a violation of the Criminal Code.58
J. Intoxication at Work

By now, you should be an expert in assessing how a court will deal with employee misconduct.
Let’s consider, lastly, an employee who reports to work intoxicated due to consumption of either
alcohol or illegal or legal (e.g., marijuana) drugs. That employee is clearly breaching an implied
(if not expressed) term of their contract. But can the employee’s employment contract be ter-
minated for cause? The answer, of course, is “it depends”: Did the intoxication affect the ability
of the employee to perform their job? What is the nature of the job? (Does the job normally
entail some drinking?59 Is the job supervisory?60) Was the intoxication an aberration in an
otherwise stellar work record?61 What was the extent of the intoxication and the employee’s
behaviour while intoxicated?62 Is the employee’s job safety sensitive, so that the intoxication
posed a substantial risk?63 Had the employee previously been warned that termination could
result if the employee reported to work intoxicated?64
The situation becomes more complicated if the employee is an alcoholic or drug addict
because of the intersection of the regulatory standards regime and human rights statutes. Alco-
holism and drug addiction are disabilities under human rights statutes, and therefore the con-
tractual right of an employer to dismiss an employee with a substance addiction is restricted. In
addition to proving that the employee was intoxicated at work in violation of the employment
contract, and that this breach of contract was sufficiently serious to warrant summary dismissal,
human rights legislation requires an employer to establish that it has accommodated the
employee’s addiction to the point of “undue hardship.”65 We will consider the treatment of em-
ployee addictions under human rights laws in Part III.
IV. Chapter Summary

By this point in the text, we have learned that in the common law regime, an employer can dis-
miss an employee engaged under an indefinite-term contract at any time, for any or no reason
at all, simply by giving the employee notice of termination. In this chapter, we learned that an
employer can terminate the employment contract without notice when the employee commits a
serious breach of contract. The loss of the right to notice of termination is a big blow to an em-
ployee, so the courts have insisted that the employee’s misconduct be of a serious nature, such
that it undermines the foundation of the employment relationship. The “proportionality test”
developed by the Supreme Court of Canada guides the parties and the courts as they assess
whether the employee’s misconduct was grave enough to bring the contract to an effective end.


1. What is “summary dismissal”?
2. Describe the two-step proportionality test developed by the Supreme Court of Canada in
the case of McKinley v. BC Tel.
3. Explain the concepts of “cumulative just cause” and “culminating incident.” What must an
employer establish to justify summary dismissal of an employee based on cumulative just
cause?
4. Prepare a list of “mitigating factors” a judge might consider in assessing whether an em-
ployer had cause for summary dismissal.
5. In what circumstances can an employee’s behaviour outside of the workplace and during
non-working hours be grounds for summary dismissal?
APPLYING THE LAW

1. Jeremy had worked at County Beer Company as a fork- 3. Jacqueline was terminated from her job as a food
lift driver. Last week, he drove his forklift into a pallet server at a local restaurant after her boss saw some of
of empty beer bottles, breaking about 30 bottles. Ali- Jacqueline’s publicly available Facebook and Twitter
son, the human resources manager decided to termin- posts. She had only been employed for six months. On
ate Jeremy for cause without notice. What information, Facebook, Jacqueline posted a series of photos of her-
if any, would you like to know before assessing wheth- self with friends in what was obviously a very inebri-
er Alison’s decision is likely to hold up in a court if Jer- ated state. She appeared to be at a party. In one photo
emy challenged his termination? she was dancing on a table in her underwear and in
2. Arisha was terminated for cause after she called in sick another she appears to be vomiting on the sidewalk.
last Tuesday. She has been employed for five years. The The only caption states, “What a party last night.”
employer pointed to the fact that Arisha had been ab- Nothing on her Facebook page identifies her as an
sent for 13 days in the past year for a variety of rea- employee of the restaurant, but her boss was repulsed
sons. Arisha had been given a written warning six by the photos and does not believe that Jacqueline is
months ago after her twelfth absence that if she the sort of person he should employ. On Twitter, Jac-
missed another day of work without prior permission queline engaged in an extended discussion with un-
she would be terminated. Four months ago, after Ari- known people in which she berated the restaurant
sha missed a Friday before a long weekend, the em- where she works and named the restaurant. She called
ployer decided to terminate her. However, because the her boss “an idiot who knows nothing about running a
employer was very busy, the termination never took bar” and claimed, falsely, that “the bar doesn’t even
place. With this last absence, the employer decided use real chicken” in their meals. The employer does not
that Arisha needed to go. Arisha sued the employer for have a written social media policy.
wrongful dismissal and argued that the employer did Considering the test for off-duty conduct examined
not have cause to terminate her without notice. She in this chapter, do you believe Jacqueline’s employer
argued that the employer had condoned her absence has grounds for summary dismissal for the comments
when it took no action four months’ earlier, and it she made on Facebook? How about her comments on
could no longer rely on the earlier written warning. Twitter?
How do you think a court would respond to Arisha’s
argument?

EXERCISE
A large volume of case law considers whether an employer had cause for summary dismissal of
an employee. Since 2001, judges have applied the proportionality test set out by the Supreme
Court of Canada in McKinley v. BC Tel, discussed in Box 12.1.
To learn how the courts have applied the proportionality test to employee misconduct, search
for cases that specifically reference the McKinley case. In this exercise, we “note up” the McKinley
case. Noting up means searching for cases that have considered and applied the reasoning in an
earlier case.
2. In the “Noteup” search box, type “McKinley v. BC Tel” and then choose “McKinley v. BC
Tel, 2001 SCC 38” from the drop-down menu that appears. That search should result in
more than 500 cases, most of which deal with disputes over whether an employer had cause
for summary dismissal. Select two or three of those cases and read them.
3. Prepare a case summary for each case that includes the key facts, the issue, and the deci-
sion, as well as answers to the following questions:
a. Did the employer rely on a single incident or cumulative just cause?
b. Did the court find that the employee engaged in misconduct? If so, what was the
misconduct?
c. If the employer relied on cumulative just cause, what was the culminating incident?
d. Did the court consider any mitigating factors and, if so, how did those factors influence
the court’s ultimate decision on whether the employer had cause for summary
dismissal?
e. Did the employer have cause for summary dismissal? What factors persuaded the
judge?
f. If the employer did not have cause, what remedy was ordered?

1. R v. Arthurs, Ex p. Port Arthur Shipbuilding Co., 1967 decided differently today. We have by now come to
CanLII 30 (Ont. CA); aff ’d [1969] SCR 85. realize that a contract of service imposes upon the
2. See R.S. Echlin & M. Certosimo, Just Cause: The Law of parties a duty of mutual respect.
Summary Dismissal in Canada (Aurora, ON: Canada Law 5. F.H. v. McDougall, 2008 SCC 53. In this decision, the
Book, 1997); and S. Rudner, You’re Fired! Just Cause for Dis- Supreme Court ruled that the “balance of probabilities”
missal in Canada (Toronto: Carswell, 2011). standard applies to all civil cases, rejecting an earlier line of
3. See Henry v. Foxco Ltd., 2004 NBCA 22 at para 109; Hall v. cases that applied a higher burden of proof in cases in
Boise Alljoist Ltd., 2006 NBCA 111; and Ogden v. Canadian which employers accused employees of criminal behaviour,
Imperial Bank of Commerce, 2014 BCSC 285 at para 216. such as theft.
4. Ennis v. Canadian Imperial Bank of Commerce, 1986 CanLII 6. Plester v. PolyOne Canada Inc., 2013 ONCA 47 at para 11.
1208 (BCSC) (summary dismissal “can be justified only by 7. See, e.g., Henry v. Foxco Ltd., supra note 3 (employee who
misconduct of the most serious kind”). See also the famous ignored an order [insubordinate] and swore at a supervisor
note in the British decision Wilson v. Racher, [1974] ICR [insolent] had not “repudiated” the contract); Laws v.
428 at 430: London Chronicle, Ltd., [1959] 2 All ER 285 (CA) at 287;
Many of the decisions which are customarily cited in and Stein v. British Columbia Housing Management Com-
these cases date from the last century and may be mission, 1992 CanLII 4032 (BCCA).
wholly out of accord with the current social condi- 8. A distinction exists between employee misconduct
tions. What would today be regarded as almost an amounting to cause for summary dismissal and misconduct
attitude of Czar – serf, which is to be found in some of constituting a repudiation of the contract by the employee.
the older cases … would, I venture to think, be A repudiation occurs when the employee refuses to

perform an essential requirement of the contract. An em- (Ont. Sup Ct J); Gillam v. Waschuk Pipe Line Construction
ployer can elect to accept the repudiation and treat the con- Ltd., 2011 SKQB 308 (ongoing harassment with culminat-
tract as having been terminated by the employee’s actions. ing incident); and Parkinson v. Kemh Holdings Limited,
Some courts have noted that if the employer asserts repu- supra note 8.
diation rather than just cause, then the issue is whether the 15. Atkinson v. Boyd, Phillips & Co. Limited, 1979 CanLII 478
refusal evinced an intention to treat the contract as at an (BCCA); Nossal v. Better Business Bureau of Metropolitan
end, rather than whether the misconduct was sufficiently Toronto Inc., 1985 CanLII 1980 (Ont. CA); Lowery v.
serious to amount to cause for summary dismissal. See Calgary (City of), 2002 ABCA 237; Henson v. Champion
Roden v. Toronto Humane Society, 2005 CanLII 33578 Feed Services Ltd., 2005 ABQB 215; and Poliquin v. Devon
(Ont. CA); and Parkinson v. Kemh Holdings Limited, 2013 Canada Corporation, supra note 13.
SKQB 172.
16. Henson v. Champion Feed Services Ltd., supra note 15;
9. Lake Ontario Portland Cement Co. Ltd. v. Groner, [1961] Brown v. Sears Ltd., 1988 CanLII 153 (NSSC); Lowery v.
SCR 553; Carr v. Fama Holdings Ltd., 1989 CanLII 240 Calgary (City of), supra note 15; Whitford v. Agrium Inc.,
(BCCA); and Universal Cargo Carriers Corp. v. Citati, 2006 ABQB 726; Riehl v. Westfair Foods Ltd., 1995 CanLII
[1957] 2 QB 401. If the employer learns the new facts but 6086 (Sask. QB); Laszczewski v. Aluminart Products
sits on them for an unreasonable period of time before Limited, 2007 CanLII 56493 (Ont. Sup Ct J); Webb v. Eaton
raising them as grounds for termination, a court may afford Yale Ltd., 2003 CanLII 29770 (Ont. Sup Ct J); Weyland v.
the facts less weight: Collette v. AMV Enterprises Ltd., 2014 Famous Players Inc., 1999 ABQB 556; Gillespie v. 1200333
BCSC 816. Alberta Ltd., 2011 ABPC 167; Oosterbosch v. FAG Aerospace
10. McIntyre v. Hockin (1889), 16 OAR 498 at 501. Inc., 2011 ONSC 1538; Caskanette v. Bong-Keun Choi Den-
tistry, 2016 ONSC 6448; Goncharova v. Marsh Lake Waste
11. MacFarlane v. Westfair Foods Ltd., 1994 CanLII 9048
Society, 2015 YKSM 4; Graf v. Saskatoon Soccer Centre Inc.,
(Alta. QB); Parkinson v. Kemh Holdings Limited, supra note
2004 SKQB 282; and Kim v. International Triathlon Union,
8 (refusal by mechanic to install tire rims amounted to a
2014 BCSC 2151. See also Duffett v. Squibb Canada Inc.,
repudiation of the contract); Roden v. Toronto Humane
supra note 13 at 42 (warnings need not be in writing, but
Society, supra note 8; Richards v. Rainy River Cattlemen’s
they must be sufficiently clear that the employee under-
Association, 2012 ONCA 260. Note that there is no “duty
stands and appreciates their significance).
to warn” an employee who has repudiated the contract by
refusing to perform the essential duties of their job. Rather, 17. The “corrective theory of discipline” is well known in both
the employer may simply treat the contract as at an end. the labour arbitration setting in unionized workplaces
(see Part IV) and in human resources literature and prac-
12. See McKinley v. BC Tel, 2001 SCC 38 at para 51 (court
tice. See M. Belcourt, G. Bohlander, & S. Snell, Managing
noting that cause for summary dismissal is often found in
Human Resources, 6th ed (Toronto: Nelson, 2011)
cases of “theft, misappropriation or serious fraud”). See also
at 532-34.
Steel v. Coast Capital Savings Credit Union, 2015 BCCA 127
(improper access and use of confidential documents); 18. Oosterbosch v. FAG Aerospace Inc., supra note 16; Laszcze-
Manak v. Workers’ Compensation Board of British Columbia, wski v. Aluminart Products Limited, supra note 16; Dawson
2018 BCSC 182 (improper use of confidential documents); v. FAG Bearings Ltd., 2008 CanLII 55459 (Ont. Sup Ct J);
Poirier v. Wal-Mart Canada Corp., 2006 BCSC 1138 and Tracey v. Swansea Construction, 1964 CanLII 271 (Ont.
(manager manipulating payroll documents); Steel v. Coast Sup Ct J).
Capital Savings Credit Union, 2015 BCCA 127 (single breach 19. Crimi v. Sun Sun Holding, 2009 ABPC 394; McIntyre v.
of privacy rules); and van Woerkens v. Marriott Hotels of Hockin, supra note 10 at 501; Jalan v. Institute of Indigenous
Canada Ltd., 2009 BCSC 73 (harassment by a manager). Government, 2005 BCSC 590; Booton v. Synergy Plumbing
13. McIntyre v. Hockin, supra note 10 at 502; Ross v. Willards and Heating Ltd., 2019 BCSC 276; Fleming v. J.F. Goode &
White Chocolate Ltd. (1927), 2 DLR 461 (Man. KB) at 469; Sons Stationers & Office Supplies Ltd., 1994 CanLII 4361
Matheson v. Matheson Industrial Trucks Ltd. (1984), (NSSC); and Kirk v. Nanaimo Literacy Association, 2018
4 CCEL 271 (Ont. H Ct J); Daley v. Depco International Inc., BCSC 1217 (seven weeks’ delay between conduct and ter-
2004 CanLII 11310 (Ont. Sup Ct J); Poliquin v. Devon mination was not condonation in light of the circumstances).
Canada Corporation, 2009 ABCA 216; Duffett v. Squibb 20. McIntyre v. Hockin, supra note 10; Nossal v. Better Busi-
Canada Inc., 1991 CanLII 7038 (Nfld. SC); Chopra v. Easy ness Bureau of Metropolitan Toronto Inc., supra note 15;
Plastic Containers Limited, 2014 ONSC 3666; and Ma v. and Backman v. Maritime Paper Products Limited, 2009
Columbia Trust Co. Ltd., 1985 CanLII 686 (BCSC). NBCA 62.
14. Grewal v. Khalsa Credit Union, 2012 BCCA 56; Daniels v. 21. McRae v. Marshall, [1891] 19 SCR 10; Confederation Life
Canadian Gift and Tableware Assn., 2003 CanLII 25192 Association v. Berry, [1927] SCR 595; Webster v. Excelsior

Life Insurance Company, 1984 CanLII 682 (BCSC); that the employee was working longer hours is cause for
and Vasquez v. Delcan Corp., 1998 CanLII 14741 dismissal); Zerr v. North Vancouver (District), 2006 BCSC
(Ont. Sup Ct J). 1819 (deliberate falsification of mileage claims is cause);
22. The courts would likely interpret an ambiguous specific and Courchesne v. INCO Ltd., 2005 CanLII 20802 (Ont. Sup
penalty clause against the interests of the employer, apply- Ct J) (a scheme to misappropriate product from employer
ing the contra proferentem doctrine we discussed in is cause).
Chapter 8. See also Allman v. Yukon Consolidated Gold 28. Erlund v. Quality Communication Products Limited (1972),
Field Co., [1908] 8 WLR 373 (YCA) (a contract term allow- 29 DLR (3d) 476 (Man. QB); Matheson v. Matheson Inter-
ing the employer to terminate the contract if it believed national Trucks Ltd., supra note 13; Duffett v. Squibb
there was cause must be applied by the employer “in good Canada Inc., supra note 13; Rowe v. Keg Restaurants Ltd.,
faith and [in a] bona fide” manner). See also G. England, 1996 CanLII 1975 (BCSC); Cottrill v. Utopia Day Spas and
Individual Employment Law, 2nd ed (Toronto: Irwin Law, Salons Ltd., 2017 BCSC 704; Brien v. Niagara Motors
2008) at 341-42. Limited, 2008 CanLII 41823 (Ont. Sup Ct J); and Kitcher v.
23. McKinley v. BC Tel, supra note 12. See also MacNaughton v. The Royal Canadian Legion, 2003 MBQB 266.
Sears Canada Inc., 1997 CanLII 9530 (NBCA) (a minor 29. Balzer v. Federated Co-operatives Limited, 2018 SKCA 93
indiscretion by an employee that cost the employer $14 did (single serious breach of well-known safety practices creat-
not “break the camel’s back” and destroy the employment ing risk to public and workers).
relationship). 30. The leading case describing the duty to warn in relation to
24. For example, employees in the banking industry who have incompetence in particular is Brown v. Sears Ltd., supra
access to financial information and funds are held to a very note 16. See also Jardine v. Hillside, 2005 NBQB 275; and
high level of honesty and fidelity: Rowe v. Royal Bank of Babcock v. C. & R. Weickert Enterprises Ltd., 1993 CanLII
Canada, 1991 CanLII 912 (BCSC) (summary dismissal was 3112 (NSCA) and comments and cases cited in note 11,
affirmed for a bank employee who violated a rule against supra.
personal relationships with customers); and Steel v. Coast 31. Knowlan v. Trailmobile Parts & Services Canada Ltd., 2006
Capital Savings Credit Union, 2013 BCSC 527 (summary BCSC 337; and Fraser v. Proscience Inc., 2005 CanLII 21549
dismissal was affirmed for a bank employee who viewed (Ont. Sup Ct J).
another employee’s personnel file without permission).
32. Middelkoop v. Canada Safeway Limited, 2000 MBCA 62.
Senior employees with high levels of authority are also held
to a very high level of trust: Robson v. Thorne, Ernst, & 33. See supra note 11 and accompanying text.
Whinney, 1999 CanLII 2845 (Ont. CA) (summary dismissal 34. See Stein v. British Columbia Housing Management Com-
upheld for an account manager who engaged in tax fraud); mission, supra note 7; Kirk v. Nanaimo Literacy Association,
Dowling v. Ontario (Workplace Safety and Insurance Board), supra note 19; Chaba v. Ensign Drilling Inc., 2002 ABPC
2004 CanLII 43692 (Ont. CA); Poliquin v. Devon Canada 131; Amos v. Alberta, 1995 CanLII 9287 (Alta. QB); Laws v.
Corporation, supra note 13; and Bannister v. General Motors London Chronicle (Indicator Newspapers) Ltd., [1959] 2 All
of Canada Ltd., 1998 CanLII 7151 (Ont. CA) (a supervisor ER 285 (CA) at 288, 270; Panton v. Everywoman’s Health
is expected to stop sexual harassment, not engage in it). Centre Society (1988), 2000 BCCA 621; Karmel v. Calgary
25. The Supreme Court of Canada indicated in the McKinley Jewish Academy, 2015 ABQB 731; Wilson v. KP Manufac-
decision that “theft, misappropriation or serious fraud” turers (Calgary) Ltd., 1998 CanLII 18141 (Alta. QB); Beau-
would normally be grounds for summary dismissal: McKin- doin v. Agriculture Financial Services Corporation, 2018
ley v. BC Tel, supra note 12 at para 51. See also Ducharme v. ABQB 627; and Marmon v. The Authentic T-Shirt Company,
England, 1999 CanLII 1107 (BCSC); Lane v. Canadian 2019 ONSC 205.
Depository for Securities Limited (1993), 49 CCEL 225 (Ont. 35. MacKinnon v. Lewis Energy Management Inc., 1999 CanLII
Gen Div); Geluch v. Rosedale Golf Assn., 2004 CanLII 14566 2167 (Ont. CA); Honda Canada Inc. v. Keays, 2005 CanLII
(Ont. Sup Ct J); Murphy v. Canadian Tire Corp. (1991), 39 8730 (Ont. Sup Ct J), partially rev’d on other grounds 2008
CCEL 205 (Ont. Gen Div); and Kong v. Oshawa Group Ltd. SCC 39 (refusal of an employer order to meet with the
(1993), 46 CCEL 181 (Ont. Gen Div). company doctor is not cause for dismissal because the em-
26. Kreager v. Davidson, 1992 CanLII 198 (BCCA); Todd v. ployee reasonably believed the order infringed his rights
7-Eleven Canada Inc., 2004 ABQB 86; Chapell v. Canadian under a human rights statute).
Pacific Railway Company, 2010 ABQB 441; and Hill v. Dow 36. Parkinson v. Kemh Holdings Limited, supra note 8.
Chemical Canada Inc., 1993 CanLII 7097 (Alta. QB). 37. Bohay v. 567876 Saskatchewan Ltd., 2009 SKPC 128; Henry
27. Deacon v. Imperial Tobacco Company Limited, 2007 BCSC v. Foxco Ltd., supra note 3; Donovan v. New Brunswick Pub-
1794 (falsification of time records to create the appearance lishing Co. Ltd., 1996 CanLII 4832 (NBCA) (telling the boss

to “shove it” is not grounds for summary dismissal); 46. Hydro-Quebec and Syndicat des employees techniques Profes-
Regdos v. Atlantic Dental Laboratories Ltd., 2007 NBQB sionnelles et de bureau d’Hydro-Quebec, 2008 SCC 43. Some
188; and Streng v. Northwestern Utility Construction Ltd., courts have found that an employment contract is “frus-
2016 BCPC 161. trated” when an employee’s illness or disability will prevent
38. Bennett v. Cunningham, 2006 CanLII 37516 (Ont. Sup Ct J) the employee from performing their job for the foreseeable
at para 34; Henry v. Foxco Ltd., supra note 3 at para 111; future: Wightman Estate v. 2774046 Canada Inc., 2006
Claire v. Moore Corp. (1989), 29 CCEL 41 (Ont. DC); BCCA 424.
Fortier v. Kal Tire, 2006 BCPC 223; Rysstad v. Dependable 47. Sylvester v. British Columbia, [1997] 2 SCR 315; Lippa v.
Turbines Ltd., 2007 BCSC 474; and Wise v. Broadway Prop- Can-Cell Industries Inc., 2009 ABQB 684; Sandhu v. North
erties Ltd., 2005 BCCA 546 (employee compared his boss, Star Mills Ltd., 2007 BCSC 1222; and Whitford v. Agrium
an elderly Jewish man, to a Nazi slave camp). Inc., supra note 16. See also Antonacci v. Great Atlantic &
39. Henry v. Foxco Ltd., supra note 3 at paras 118-20; Regdos v. Pacific Co. of Canada, 1998 CanLII 14734 (Ont. Sup Ct J),
Atlantic Dental Laboratories Ltd., supra note 37 (calling a aff ’d 2000 CanLII 5496 (Ont. CA), noting that the doctrine
supervisor a “piece of shit” does not justify summary dis- of frustration requires consideration of the human rights’
missal when it occurs in private). Contrast with Codner v. duty to accommodate. Contrast Novakowski v. Canadian
Joint Construction, 1989 CanLII 4852 (Nfld. SC) (calling a Linen & Uniform Service Co, 2015 ABQB 53 at para 89, sug-
president a “fucking liar” justifies summary dismissal even gesting that the duty to accommodate does not apply in the
though it took place in private). common law regime.
40. Geluch v. Rosedale Golf Assn., supra note 25 at para 92; 48. Elliott v. Parksville (City of), 1990 CanLII 806 (BCCA);
Gillam v. Waschuk Pipe Line Construction Ltd., supra note Fleming v. J.F. Goode & Sons Stationers & Office Supplies
14; Dotchin v. Saskatchewan (Workers’ Compensation Ltd., supra note 19; S.S. v. Huang & Danczkay Property
Board), 2002 SKQB 279; and Neigum v. Wilkie Co-operative Management Inc., 1999 CanLII 14865 (Ont. Sup Ct J);
Association Ltd., 1987 CanLII 4786 (Sask. QB). Thompson v. Flemming, 2009 NBQB 340; Riley v. Crown
Trust Co., [1977] 5 AR 1 (TD); Pagnotta v. Read Jones
41. Bannister v. General Motors of Canada Ltd., supra note 24;
Christoffersen Ltd., 1990 CanLII 5944 (Alta. QB) (excessive
Simpson v. Consumers’ Assn. of Canada, 2001 CanLII 23994
absenteeism not cause for dismissal); and Rutkowski v.
(Ont. CA); Fleming v. Ricoh Canada Inc., 2003 CanLII 2435
Edmonton Transit Mix & Supply Co. Ltd., 2007 ABQB 277.
(Ont. Sup Ct J); Menagh v. Hamilton (City), 2007 ONCA
244; van Woerkens v. Marriott Hotels of Canada Ltd., supra 49. Minott v. O’Shanter Development Company Ltd., 1999
note 12; Leach v. Canadian Blood Services, 2001 ABQB 54; CanLII 3686 (Ont. CA); and Bailey v. Service Corporation
Gonsalves v. Catholic Church Extension Society of Canada, International (Canada) ULC, 2018 BCSC 235.
1998 CanLII 7152 (Ont. CA); Gillam v. Waschuk Pipe Line 50. Aeichele v. Jim Pattison Industries Ltd., 1992 CanLII 986
Construction Ltd, supra note 14; and Foerderer v. Nova (BCSC); Riley v. Crown Trust Co., supra note 48; and
Chemicals Corporation, 2007 ABQB 349. Marmon v. The Authentic T-Shirt Company, supra note 34.
42. Fonceca v. McDonnell Douglas Canada (1983), 1 CCEL 51 51. Hunter v. Webcentrex Inc., 2007 NSSM 35.
(Ont. H Ct J); MacDonald v. Valley Credits Ltd. (1988), 12 52. See, for example, Oosterbosch v. FAG Aerospace Inc., supra
ACWS (3d) 358 (BCSC); Geluch v. Rosedale Golf Assn., note 16; and Gichuru v. Smith, 2013 BCSC 895.
supra note 25; Brazeau v. International Brotherhood of Elec-
53. Off-duty conduct not grounds for summary dismissal:
trical Workers, 2004 BCCA 645; Tse v. Trow Consulting En-
Backman v. Hyundai Auto Canada, 1990 CanLII 4087
gineers Ltd. (1995), 14 CCEL (2d) 132 (Ont. Gen Div); and
(NSSC) (not cause for dismissal when an employee is
Hodgins v. St. John Council for Alberta, 2007 ABQB 275,
charged with drug trafficking, since there is no harm to the
aff ’d 2008 ABCA 173. See the discussion of mitigating
employer’s interests); Klonteig v. West Kelowna (District),
factors to be considered in harassment cases in Alleyne v.
2018 BCSC 124 (no cause for dismissal when the assistant
Gateway Co-operative Homes Inc., 2001 CanLII 28308 (Ont.
fire chief was arrested for driving an employer vehicle while
Sup Ct J).
intoxicated in off-hours); Merritt v. Tigercat Industries, 2016
43. Izzard v. Cosmopolitan Industries Ltd., 2002 SKQB 200. ONSC 1214 (arrest for sexual assault against minors); and
44. Dilg v. Dr. D. Sarca Inc., 2007 BCSC 1716. Fleming v. Ricoh Canada Inc., supra note 41.
45. Shakur v. Mitchell Plastics, 2012 ONSC 1008. See also Ditch- 54. Cases in which off-duty conduct was found to be grounds
burn v. Landis & Gyr Powers, Ltd., 1997 CanLII 1500 (Ont. for summary dismissal: Harrop v. Markham Stouffville Hos-
CA) (drunken fight with a client is not grounds for pital, 1995 CanLII 7295 (Ont. Sup Ct J) (the relationship of
summary dismissal); and Phanlouvong v. Northfield Metal a nurse with a former psychiatric patient); Canadian Impe-
Products (1994) Ltd., 2014 ONSC 6585 (punching a co- rial Bank of Commerce v. Boisvert (1986), 68 NR 355 (FCA)
worker is not grounds for summary dismissal). (a bank employee’s relationship with a bank robber);

Whitehouse v. RBC Dominion Securities Inc., 2006 ABQB 58. Asurion Canada Inc. v. Brown and Cormier, 2013 NBCA 13.
372 (investment adviser brought prostitute to his office after 59. See MacDonald v. Northern Breweries Ltd., [1989] OJ
hours); Kelly v. Linamar Corporation, 2005 CanLII 42487 No. 3331 (QL) (DC) (the dismissal of a beer salesman who
(Ont. Sup Ct J) (arrest for child pornography on home lost his licence after impaired driving was not just cause).
computer); and Smith v. Kamloops and District Elizabeth
60. Rose v. Marystown Shipyard Limited, 1985 CanLII 1829
Fry Society, 1996 CanLII 2897 (BCCA) (social worker in a
(Nfld. CA).
relationship with a client).
61. Ditchburn v. Landis & Gyr Powers Ltd., 1995 CanLII 7290
55. There are surprisingly few cases to date in which a
(Ont. Sup Ct J); and Robinson v. Canadian Acceptance
non-union employee has challenged their termination for
Corp., [1974] 9 NSR (2d) 226 (CA).
comments made on social media. In Kim v. International
Triathlon Union, 2014 BCSC 2151, the court ruled that no 62. Dziecielski v. Lighting Dimensions Inc., 2012 ONSC 1877
cause for summary dismissal existed when a communica- (a drunk employee caused a life-threatening vehicle crash
tions employee made comments on social media that were on a busy highway, so termination for cause was upheld);
potentially harmful to the employer’s interests in large part and Whitehouse v. RBC Dominion Securities Inc., supra note
because the employee had not been warned. Given the 54 (a drunk employee who brought a prostitute to the office
employee was a communications officer it is not clear that is dismissed for cause); van Woerkens v. Marriott Hotels of
this case involved “off-duty conduct.” There are numerous Canada Ltd., supra note 12 (manager’s intoxication affected
cases involving unionized employees fired for social media his poor judgment, which contributed to his termination
posts, which we will look at in Part IV of this book. for harassment).
The BC Labour Relations Board upheld the dismissal of 63. Anstey v. Canadian National Railway Co. (1980), 27 Nfld.
two employees for Facebook comments that derided and and PEIR 95 (Nfld. CA) (summary dismissal of a drunk
threatened supervisors: Lougheed Imports Ltd. boat captain is upheld); Murphy v. Sealand Helicopters Ltd.,
(West Coast Mazda) v. United Food and Commercial 1988 CanLII 5402 (Nfld. SC); and Birchall v. Canadian Heli-
Workers International Union, Local 1518, 2010 CanLII copter Ltd., 1998 CanLII 4176 (BCSC) (dismissal is upheld
62482 (BCLRB). Racist or sexist comments, or comments of a helicopter pilot who reported to work with an alcohol
that are derogatory to a particular religion, can also violate level above the lawful limit).
human rights legislation: Perez-Moreno v. Kulczycki, 2013 64. Blomgren v. Jingle Pot Pub Ltd., 1999 BCCA 9 (an employee
HRTO 1074. See also J. Teitel, “Fired over Facebook: had been given a clear warning that intoxication at work
The Consequences of Discussing Work Online” (2012) would result in termination); and Volchoff v. Wright Auto
2:2 UWO J Legal Stud 3. Sales Inc., 2015 ONSC 8029 (employee was not warned that
56. Poliquin v. Devon Canada Corporation, supra note 13; and consumption of alcohol could lead to termination).
Backman v. Maritime Paper Products Limited, 2008 NBQB 65. Chopra v. Syncrude Canada Ltd., 2003 ABQB 504; and
219; aff ’d 2009 NBCA 62. Whitford v. Agrium Inc., supra note 16.
57. Foerderer v. Nova Chemicals Corporation, supra note 41;
Poliquin v. Devon Canada Corporation, supra note 13; and
Wong v. Lantic Inc., 2012 ABQB 716.


C H A P T E R 13
“You Forced Me to Quit!”: The Special

Case of Constructive Dismissal
After reading this chapter, students will I. Introduction 201
be able to: II. The Legal Concept of “Constructive Dismissal” 202
A. Constructive Dismissal Based on Employer Behaviour That May Not Breach a Term of the Contract
• Define and explain constructive but That Makes Continued Employment “Intolerable” 203
dismissal. B. Constructive Dismissal Based on Substantial Breach of an Essential Term of the Contract 204
• Recognize common situations in which III. Common Scenarios That Give Rise to a Constructive Dismissal 205
constructive dismissal arises. A. Changes to an Employee’s Compensation and Benefits 205
• Explain the various tests used by the B. Changes to an Employee’s Job Assignment 206
courts to decide whether a C. Reassignment of an Employee to a Different Work Location 208
constructive dismissal has occurred. D. “Don’t Come to Work!”: Unpaid Disciplinary Suspensions, Temporary Layoffs, and Administrative
• Describe the legal options available to Leaves or Suspensions 209
an employee confronted with a serious E. Employee Harassment or a Poisoned Work Environment 210
breach of the employment contract by IV. Employee Acceptance and Condonation of the Employer’s Repudiation of Contract 211
an employer. V. Chapter Summary 212
Exercise 213
I. Introduction
Andy Murray was excited to be hired as an assistant coach of the Winnipeg Jets of the National
Hockey League. He agreed to a three-year fixed-term contract that paid him in excess of
$100,000 per year. Murray was good at his job. However, as often happens with pro sports teams,
the organization’s management decided to shuffle its coaching staff about halfway through the
three-year period. Management reassigned Murray to the position of hockey scout. Murray
would be paid the same salary, but being a hockey scout was much less desirable than being an
assistant coach. Murray refused to accept the reassignment and insisted he remain in the assist-
ant coach job he was hired to perform. Management refused, so Murray quit. As a result of the
contract coming to an early end, Murray lost out on about $150,000 that would have been paid
to him had the contract run for the full three-year term.
What should happen in this situation? Murray brought the employment relationship to
an end by quitting without notice. Therefore, maybe Murray should forfeit the money.
Then again, it was the employer’s actions, in removing Murray from the job he was hired to
perform and assigning him to a less desirable job, that really caused the breakdown of the rela-
tionship. Had the employer just left Murray in his coaching position, no problems would have
arisen.
201

The question of whether an employee must tolerate a unilateral change in working conditions
is at the core of the law of constructive dismissal. A constructive dismissal occurs when an
employer commits a fundamental breach of contract or otherwise behaves in a manner that
makes the workplace intolerable for the employee, and the employee responds by treating the
contract as having been terminated by the employer.1 Since a constructive dismissal results in
the termination of the employee’s employment contract, the employee can recover damages
based on the failure of the employer to provide notice of termination. Therefore, constructive
dismissal is a special type of wrongful dismissal. The word “constructive” refers to the fact
that constructive dismissal is a legal invention (a legal “construct”): the court “constructs” a ter-
mination based on the employer behaving as if it no longer intends to be bound by the contract,
even though the employer never utters the words “you are terminated.”2
In the Winnipeg Jets case described above, the court ruled that the employer had committed
a constructive dismissal by reassigning Murray without his agreement. The judge wrote:
The contract employed Murray as a coach and for no other purpose. The action of the Jets reflected
a material change in Murray’s employment agreement. It went to the essence of the contract and
amounted to a repudiation that entitled Murray to treat the agreement as at an end.3
The Jets were ordered to pay Murray close to $150,000 in damages, reflecting his lost wages
for the remaining period of the three-year contract. In this chapter, we will review the basic
principles and tensions that shape the law of constructive dismissal. We will also examine some
of the most common sorts of employer behaviour that give rise to constructive dismissal.
II. The Legal Concept of “Constructive Dismissal”

Constructive dismissal is based on the doctrine of repudiation of contract. A repudiation of
contract occurs when a party behaves in a manner that demonstrates they no longer intend to
be bound by the terms of the contract. Usually this behaviour involves a substantial (sometimes
called “fundamental” or “repudiatory”) breach of an essential term of the contract, but some-
times an intention to no longer be bound by a contract can be demonstrated by a pattern of
behaviour that overall demonstrates this intention.4 The innocent party can elect to treat the
contract as having been terminated, which entitles that party to damages for any loss resulting
from that termination.
In the case of constructive dismissal, the employer’s “repudiatory” conduct does not auto-
matically bring the contract to an end. Rather, a constructive dismissal occurs only when the
employee accepts an employer’s repudiation of contract by quitting and suing for constructive
dismissal.5 The language of “acceptance” here can be confusing. It does not mean that the em-
ployee accepts the employer’s behaviour. Instead, it means that the employee is accepting that
the employer has terminated the employment contract.
The onus is on the employee to prove that a constructive dismissal has occurred. Often the
constructive dismissal results from a single, substantial breach of contract by the employer.
However, just as an employer may rely on an accumulation of wrongful acts by the employee to
justify summary dismissal (see Chapter 12), so too can constructive dismissal be based on the
constructive dismissal: A fundamental change to an employment contract by an employer that an employee may treat as
an effective termination of the contract.
acceptance of an employer’s repudiation of contract: When an employee responds to a repudiation of the employment
contract by the employer by treating the contract as over and quitting.

Chapter 13 “You Forced Me to Quit!”: The Special Case of Constructive Dismissal 203
cumulative effect of less serious breaches of contract by an employer (called cumulative effect
constructive dismissal).6
In a 2015 decision called Potter v. New Brunswick Legal Aid Services, the Supreme Court of
Canada recognized two types (or branches) of constructive dismissal:7
1. Constructive dismissal based on employer behaviour that may not breach a term of the
contract but that makes continued employment “intolerable.”
2. Constructive dismissal based on substantial breach of an essential term of the contract.
Most cases are decided applying the second branch of constructive dismissal. Let’s consider
each branch separately.
A. Constructive Dismissal Based on Employer Behaviour That May Not Breach
a Term of the Contract but That Makes Continued Employment “Intolerable”
The origins of this branch of constructive dismissal are quite recent and date from a 2000 deci-
sion of the Ontario Court of Appeal in a case called Shah v. Xerox Canada Ltd.8 In that case, the
court ruled that an employer had constructively dismissed the employee by engaging in a pat-
tern of harassment and false allegations against the employee spanning a period of six months.
The court ruled that it was not necessary for an employee to point to the breach of any particular
clause of the contract in cases where the employer’s behaviour overall makes “continued
employment intolerable.” In applying this branch of constructive dismissal, courts apply an
objective test (see discussion in Chapter 7) and ask whether a “reasonable employee” in the
circumstances would conclude that the employer no longer intended to be bound by the con-
tract by making the employee’s continued employment “intolerable.”9

Did the Employer Constructively Dismiss the Employee by Hiring a Man Who Had Sexually
Harassed Her Years Earlier?
Colistro v. Tbaytel Decision: Yes. The Ontario Court of Appeal ruled that the
2019 ONCA 197 employer’s behaviour made continued employment intolera-
ble for the employee. The test is whether a “reasonable em-
Key Facts: C had been employed for 20 years by Tbaytel. In ployee” in the employee’s situation would find that the
January 2007, the employer announced it was hiring Benoit as employer’s behaviour made the workplace intolerable.
a vice-president. C was shocked and upset by this because in The employer’s behaviour can take the form of a series of
the mid-1990s, Benoit had been terminated from the company harmful actions (cumulative effect) or a single serious act by
after sexually harassing C and others. C went on sick leave and the employer. In this case, a reasonable employee would find
was diagnosed with post-traumatic stress disorder. She de- that the employer’s decision to hire a man who had earlier
manded that the employer not hire Benoit. The employer re- been terminated for harassing C, knowing that this caused C
fused and went ahead with Benoit’s hiring, offering to transfer trauma, would render continued employment intolerable for
C to another building. C refused to be transferred, quit, and C. Therefore, the employer had constructively dismissed C. The
filed a lawsuit for constructive dismissal. employer was ordered to pay damages to C based on 12
Issue: Did the hiring of Benoit make C’s continued employ- months’ reasonable notice, plus additional damages of
ment intolerable and therefore amount to a constructive $100,000 for bad faith in the manner of dismissal (see Chapter
dismissal? 14 for a discussion of damages).
cumulative effect constructive dismissal: A constructive dismissal that is founded on an accumulation of breaches of the
employment contract by the employer, none of which alone would be serious enough to constitute a constructive dismissal.

It is worth noting that in most cases in which the court has ruled that employer behaviour
made continued employment “intolerable,” the employee could alternatively have argued the
second branch of constructive dismissal (constructive dismissal based on a fundamental breach
of the contract) on the basis that the employer committed a substantial breach of the implied
contract term requiring decency, civility, respect, and dignity, discussed in Chapter 9.10
B. Constructive Dismissal Based on Substantial Breach of an Essential Term

of the Contract
Most constructive dismissal decisions apply the second branch of the test, which requires the
courts to answer three questions:
1. What are the express and implied terms of the contract, and did the employer breach
one of those terms?
2. If the employer breached a contract term, then was that breach “substantial” and detri-
mental to the employee? In answering this question, the courts again apply an “objective
test” and ask whether a “reasonable employee” in the employee’s circumstances would
conclude that the employer’s breach of contract has substantially altered an essential
term of the contract.11
3. Did the employee “accept” the repudiation and treat the breach as having terminated
the contract?
Many constructive dismissal cases turn on how the court answers the second question. A
relatively minor breach of contract by an employer will not be sufficient to repudiate the con-
tract as a whole. An employee who treats a non-substantial breach of contract (i.e., a less serious
breach that does not demonstrate an intention to treat the contract as at an end) by the employer
as a constructive dismissal has simply resigned. As we discuss below, an employee must elect
whether to “accept” the repudiation (question 3 in the list above) within a reasonable period of
time. If the employee does not, then a court may rule that they have condoned the employer’s
breach, the consequence of which is that an action for constructive dismissal would be barred
(dismissed by the court).
The leading case in Canada on the law of constructive dismissal based on a substantial breach
of contract is Farber v. Royal Trust Co., summarized in Box 13.2. Since 1997, hundreds of deci-
sions have been issued dealing with alleged constructive dismissal that cite Farber. The exercise
at the end of this chapter focuses on researching these decisions. The remainder of this chapter
explores various common scenarios that can give rise to a constructive dismissal based on a
substantial breach of an expressed or implied term of the contract by the employer.

Change to Job Duties Resulting in What the Employee Believes Will Be a Substantial Pay Cut
Farber v. Royal Trust Co. his pay in that job would be based on commissions alone.
[1997] 1 SCR 846 Farber estimated that his compensation would be cut in half
in this job. Rather than report to the new job, Farber quit and
Key Facts: Farber was employed by Royal Trust Co. as regional sued for constructive dismissal. It turned out that the branch
manager for western Quebec, responsible for supervising Farber would have been transferred to did better than ex-
some 21 offices and over 400 employees. The employer re- pected, and had Farber reported to that job, his loss of pay
structured and eliminated that job. It offered Farber his old job, would not have been as great as he anticipated.
as manager of a single underperforming branch, and told him
condonation: When a party that could have treated the employment contract as having been repudiated (terminated) by the
other party’s breach of the contract elects not to treat the contract as being repudiated.

Issue: Was Farber constructively dismissed by his job tigious job warranted a finding of constructive dismissal.
reassignment? Applying this law, the court ruled that Farber’s reassignment
“altered the essential terms of the employment contract”
Decision: Yes. The Supreme Court of Canada explained the
and that “at the time the offer was made, any reasonable
test for constructive dismissal based on a substantial breach
person in the same situation as the appellant would have
of the employment contract as follows:
come to that conclusion.” Thus, the test is whether a “rea-
[W]here an employer unilaterally makes a funda- sonable employee” would conclude that the employer is
mental or substantial change to an employee’s altering an essential term of the contract, given the facts as
contract of employment—a change that violates understood at the time the change is proposed. Therefore,
the contract’s terms—the employer is committing what actually happened at the branch after Farber quit was
a fundamental breach of contract that results in its irrelevant, since Farber could not have looked into the future
termination and entitles the employee to consider to see that the branch would perform unexpectedly well.
himself or herself constructively dismissed. Farber was constructively dismissed and was entitled to
damages based on a period of one year’s reasonable
The Supreme Court noted a number of prior decisions in notice.
which the courts had found that a demotion to a less pres-
III. Common Scenarios That Give Rise to a Constructive Dismissal

A. Changes to an Employee’s Compensation and Benefits
For many employees—probably most—the compensation clause is the most important in the
employment contract. After all, most of us work in order to be paid. Judges know this, and they
have said that cuts to compensation go to the “root of the employment contract.”12 Therefore,
when employers breach the compensation clause by cutting an employee’s pay, they are treading
in dangerous waters. Any significant reduction in an employee’s pay that is not accepted by an
employee will amount to a fundamental breach of the employment contract, giving the em-
ployee the right to quit and claim damages for constructive dismissal. The question that arises
is whether the pay cut is substantial enough to amount to a fundamental breach, as opposed to
a non-fundamental breach.
A unilateral cut to an employee’s base pay of 15 percent or more will almost certainly consti-
tute a substantial breach of the employment contract, which the employee can treat as a con-
structive dismissal.13 That type of case is clear-cut. More difficult to predict is how the courts
will deal with smaller pay cuts amounting to less than 15 percent. The courts seem to be influ-
enced in these close cases by the broader circumstances that surround the change. For example,
in Pullen v. John C. Preston Ltd., a 10 percent cut in pay was found not to be grounds for a con-
structive dismissal where the judge believed that the company “was in serious difficulty.”14 In
contrast, a 10 percent pay cut combined with other changes to a sales employee’s territory was
found to be a constructive dismissal in the case of Benell v. William E. Coutts Co.15
Sometimes the employee does not know for sure how significantly a job change will affect
them at the time they need to decide whether to “accept” the employer’s breach of contract and
sue for constructive dismissal. That was the situation in the important Farber decision discussed
in Box 13.2.
When the cut is to the employee’s base pay, as opposed to supplemental benefits (health care,
vacation time, etc.) or variable pay (such as a discretionary bonus), it is more likely to be con-
sidered a fundamental breach. An employer who says, “I will not pay you the base wage rate we
agreed upon” is considered to be expressing the sentiment that it no longer intends to abide by
an essential term of the contract.16 Variable pay, on the other hand, is expected to fluctuate, and
the courts have long implied the right of employers to make relatively minor changes to supple-
variable pay: A portion of an employee’s compensation that varies from time to time based on the employee’s or company’s
performance or the discretion of the employer.

mental benefits.17 However, non-payment of a bonus that the employee had earned and that
would reasonably be expected based on the contract and past practice can still amount to a
constructive dismissal.18
B. Changes to an Employee’s Job Assignment

In the course of the employment relationship, employers will sometimes want to move employ-
ees into different jobs for any number of reasons. Constructive dismissal lawsuits arise when the
employee does not accept the move and instead elects to quit. The first question the courts must
then consider is whether the contract confers a right on the employer to unilaterally reassign the
employee. A contract could include an expressed right for employers to reassign employees,
although few reported decisions rely on such clauses. However, we know from Chapter 9 that
even if there is no clear, expressed contractual right for the employer to reassign the employee,
this right may exist as an implied contract term.
The courts have found that employers have an implied right to make “reasonable” reassign-
ments and to shuffle job tasks.19 As an Ontario Court of Appeal justice wrote in the case of
Canadian Bechtel Ltd. v. Mollenkopf: “[an employee has] no vested right in the particular job
initially given to him. If the employer … acted in good faith and in the protection of its own
business interests, the plaintiff would have no right to refuse the transfer.”20 This implied man-
agerial right to move employees around is a holdover from the old master and servant law
(detailed in Chapter 5) and a reminder that in the common law regime, the employer is the boss
and entitled to a certain latitude in running its operation.21
As noted, the implied right of an employer to reassign job tasks is not unlimited. The courts
have imposed a reasonableness requirement on this right. In practice, the reasonableness
requirement can be described by reference to the following three factors:
1. The reassignment must be made for good-faith business reasons, and not as a guise to
force the employee to quit.22
2. The reassignment or change in duties must be relatively minor, involve skills within the
employee’s general capabilities, and not amount to a fundamental shift in the type of
work the employee was hired to perform.23 The more substantial the change in duties,
the more likely a court will find it amounted to a fundamental breach of contract.
3. If the reassignment results in a demotion, then it is far more likely to constitute a con-
structive dismissal.24
A demotion involves a reassignment to a less prestigious job with less responsibility and
often, though not necessarily, less pay. In Farber, the Supreme Court of Canada observed that
the courts have often held that a demotion “is a substantial change to the essential terms of an
employment contract that warrants a finding that the employee has been constructively dis-
missed.”25 Usually a demotion will justify a finding of constructive dismissal, unless an expressed
contractual right is given to the employer to demote26 or the demotion is very minor27 or tem-
porary.28 In contrast, a lateral transfer or promotion, even in the face of an objection from the
employee, will usually not be treated by the courts as a constructive dismissal. The case dis-
cussed in Box 13.3 considers whether a lateral transfer is grounds for a constructive dismissal.
demotion: A reassignment of an employee’s position by an employer to another position with lower pay, less prestige, or
less responsibility.
lateral transfer: A reassignment of an employee’s position to another position that is roughly equal in terms of pay, prestige,
and responsibility.
promotion: A reassignment of an employee’s position by an employer to another position with higher pay, more prestige,
and more responsibility.


When Is a Reassignment a Constructive Dismissal?
Dykes v. Saan Stores Ltd. Issue: Did the employer commit a fundamental breach of the
2002 MBQB 112 employment contract in reassigning Dykes to a new manage-
ment position?
Key Facts: Dykes was employed as manager of human re-
sources for Saan Stores Ltd. He had no written employment Decision: No. The court found that an implied term in Dykes’s
contract with his employer. The employer received several employment contract permits the employer to reassign his
complaints from employees about Dykes’s abrasive manage- duties within the human resources management function,
ment style. In response, the employer decided to create a new provided that the duties he is assigned are within his abilities
position for Dykes: manager of human resources planning and and skill set. Dykes’s compensation was not cut, nor was he
development. The new position paid the same salary and was demoted, since he remained a senior human resources man-
still a human resources management position. However, he ager at the same level. The reassignment was not based in bad
would no longer supervise as many employees, and his role as faith, but was a response to legitimate concerns about conflict
manager of customer relations was removed. Dykes did not between Dykes and his subordinates in his old job. Therefore,
want the new position and also feared he was “being set up to the employer did not commit a fundamental breach of any
fail” in the new position so that the employer could later dismiss contract term.
him for cause. Dykes quit and sued for constructive dismissal.

Balancing Competing Interests in Constructive Dismissal Law
The doctrine of constructive dismissal provides some protec- (or pay in lieu of notice) and offering a new contract
tion to an employee who is being driven to quit by an em- based on the revised terms. When employers opt not to pur-
ployer that is hoping to avoid the legal requirement to give sue either of these courses of action, employees should be
notice of termination. However, in most constructive dismissal entitled to insist on maintenance of the past and existing
cases, the employer has no intention of driving the employee arrangements.
out or of terminating the contract. Usually the employer is On the other hand, the option of terminating the contract
making changes for what it believes are legitimate business with notice and offering a new contract can be costly and slow
reasons. For example, the employer is restructuring to improve for an employer that needs to quickly adapt to market threats.‡
efficiency or to lower expenses in the face of competition. In An alternative approach would be to grant employers wide
these situations, the doctrine of constructive dismissal pits the latitude to make changes to working conditions, provided that
employer’s legitimate business interests against the employ- those changes are made in good faith and without malice.§
ee’s interests in preserving the bargain as set out in the original This approach would give employers considerable flexibility,
employment contract.* which could help improve efficiency, increase profits, and
How do the courts balance these competing interests? Do protect employers from market threats. However, this ap-
they favour the employer’s economic interest in flexibility or proach would leave employees vulnerable to sudden, un-
the employee’s interest in preserving the status quo? The latter expected changes to their jobs.
approach could be justified on the basis that employers are The contemporary approach of Canadian courts falls some-
in a position of power and usually draft employment con- where in between the contrasting approaches just described.
tracts, a fact the courts have long recognized, as noted in While the courts have restricted the right of employers to make
Chapter 10. If employers want a right to make unilateral significant changes without employee consent, they have also
changes to working conditions, including job functions and granted employers significant latitude to make less drastic
compensation schemes, then they could include an expressed changes to respond to economic challenges. Some authors
contractual right to make those changes, perhaps with some have argued that the courts give employers wider latitude to
amount of notice to the employee.† Moreover, as we learned make unilateral changes to working conditions in difficult
in Chapter 8, an employer can always change working condi- economic conditions, as described in this passage from a
tions by terminating the contract with proper working notice casebook on constructive dismissal:

In prosperous economic times, courts may narrow pay attention to how the courts have struck a balance between
an employer’s latitude to vary the employment con- employer and employee interests in their reasoning.
tract. The “necessity” of changing the terms of em-
ployment without an employee’s consent may not * See R.S. Echlin and J. Fantini, Quitting for Good Reason: The Law of
be as evident in a positive business climate. Accord- Constructive Dismissal in Canada (Aurora, ON: Canada Law Book, 2001)
ingly, when an employer is faced with difficult eco- at 197.
nomic conditions, the need to reorganize in order † Many cases have taken this strict contractualist approach to the right of
to remain competitive or, in some cases, to merely employers to make unilateral changes to the contract: Brown v. Canada
Biscuit Co. Ltd., [1935] SCR 212; and Corker v. University of BC, 1990 CanLII
survive is more often justified by the courts.#
748 (BCSC). See also G. England, “Recent Developments in Individual
Employment Law: Tell Me the Old, Old Story” (2002) 9 CLELJ 43 at 65-66,
This passage suggests that developments in the broader considering if a contract clause permitting an employer to make
economic and market subsystem (discussed in Chapter 2) in- unilateral changes to any contract term would render the contract void
fluence the outcomes of constructive dismissal disputes. It since the content of the offer and acceptance would be too vague.
implies also that judges are influenced by the employer’s ‡ See G. England, “Recent Developments in Individual Employment Law:
motive in making a unilateral change rather than the pure Tell Me the Old, Old Story” (2002) 9 CLELJ 43 at 62.
contract question of whether the employer’s actions amount § This approach seems to rule the day in Black v. Second Cup Ltd., 1995
to a fundamental change to the original contract. However, in CanLII 7270 (Ont. Sup Ct J); Gillespie v. Ontario Motor League Toronto
Farber (see Box 13.2), the Supreme Court noted that a “bad Club (1980), 4 ACWS (2d) 87 (Ont. H Ct J); and Purdy v. Vancouver Island
Helicopters, [1988] BCJ No. 2157 (QL) (SC).
faith” motive by the employer, or an intention to force an em-
ployee to quit, is not a necessary component of a constructive # Echlin and Fantini at 197. See also Hamilton & Olsen Surveys Ltd. v. Otto,
1993 ABCA 233.
dismissal. As we work through our discussion of the case law,
C. Reassignment of an Employee to a Different Work Location

A reassignment to a different geographical location is treated in a similar manner to a reassign-
ment of job duties. The courts begin by asking whether an expressed contract term exists permit-
ting the employer to transfer the employee to a new location. If so, then that term will govern the
transfer. For example, no constructive dismissal was found where an employer transferred an
employee from Vancouver, British Columbia, to Thompson, Manitoba, when the contract
included an expressed right for the employer to relocate the employee “in order to satisfy business
conditions.”29 Alternatively, if a contract very clearly provides that the employee will remain in one
location, then a transfer out of that location would constitute a fundamental breach of contract.
Absent an expressed contractual right for employers to relocate employees, the courts con-
sider whether an implied right exists governing relocation. Here again, the courts have struck a
balance and implied a right for employers to require “reasonable” geographical relocations, as
captured in this often-cited passage from the Ontario Court of Appeal in the case of Smith v.
Viking Helicopter Ltd.:
It has never been my understanding that an employee is entitled to a job for life in a place of his
choosing. If he wishes to remain an employee of a given company, he must expect reasonable disloca-
tions in that employment including the place where it is to be performed. There was no evidence in
this case that Viking acted unreasonably in notifying the respondent of its intended move or of its
desire that he and others should accompany it. The sole complaint was about its lack of timeliness
and specificity as to what moving expenses it would be prepared to absorb.30 [Emphasis added]
Whether the relocation is “reasonable” depends on a number of factors. The relocation must
be based on legitimate business reasons and not intended to punish the employee or drive them
to quit. If the job in the new location would involve a demotion or a pay cut, then it is more likely
to amount to a constructive dismissal, for the reasons discussed above. If the job is of a sort in
which geographical transfers are common and expected, then it is more likely a court will find
the right to relocate is implied in the contract. Thus, executives employed by companies with
multiple locations and in jobs and industries where job mobility is common are often assumed

to have agreed that the employer may relocate them.31 In some cases, the courts have found
relocations to be unreasonable, and therefore a fundamental breach of contract, when the move
would impose a serious hardship on the employee’s economic or family life.32
D. “Don’t Come to Work!”: Unpaid Disciplinary Suspensions, Temporary

Layoffs, and Administrative Leaves or Suspensions
There are a variety of circumstances in which an employer refuses to permit an employee to
work for a period of time. These include disciplinary suspensions, temporary layoffs, and ad-
ministrative leaves or suspensions. The first two are usually unpaid, while an administrative
leave may be with or without pay. In all of these circumstances, the question arises whether the
employer is contractually permitted to refuse an employee the right to perform their job. Keep
in mind that the basic exchange at the foundation of the employment contract is a promise by
the employer to pay compensation to an employee in exchange for that employee coming to
work and performing their job.
Therefore, Canadian courts have ruled that, absent an expressed or implied term in the con-
tract permitting layoffs, a layoff of an employee is a breach of contract that an employee may
treat as a constructive dismissal. The Ontario Court of Appeal explained this point in the 2011
decision in Elsegood v. Cambridge Spring Service:
At common law, an employer has no right to lay off an employee. Absent an agreement to the con-
trary, a unilateral layoff by an employer is a substantial change in the employee’s employment and
would be a constructive dismissal.33
An employer could avoid constructive dismissal by including an expressed contract term

permitting temporary layoffs, which is common in the case of collective agreements in union-
ized workplaces, but relatively few non-union employment contracts include layoff terms.
Some Canadian courts have found that a short paid suspension for performance-related
concerns does not give rise to grounds for a constructive dismissal.34 However, an unpaid disci-
plinary suspension of an employee will usually amount to constructive dismissal if the employee
refuses to accept it.35 (See Box 13.5.) An unpaid suspension is only permitted in two situations.
First, the contract could include an expressed or implied contractual right for the employee to
be suspended without pay. An implied right to suspend could be based on a history of the em-
ployer issuing unpaid suspensions that is well known and accepted by the employee. Second, if
the employee’s misconduct leading to the suspension was serious enough to justify summary
dismissal for cause, then the employer may be permitted to opt instead to apply unpaid suspen-
sion, which is a lesser form of discipline.36 Thus, if the employer defends a constructive dismissal
lawsuit based on an unpaid suspension by arguing that it had cause for summary dismissal, the
court must consider the law of summary dismissal (see Chapter 12).
An administrative leave or suspension occurs when an employer orders an employee to stay
home for reasons other than a lack of work (i.e., a layoff) or discipline. For example, an employer
might place an employee on administrative leave while it investigates whether the employee had
done something wrong or while a criminal charge brought against the employee makes its way
through the courts. In these cases, courts have generally ruled that an employer may temporarily
place an employee on leave until the investigation concludes, but only if (1) there is a nexus
between the allegations against the employee and the employer’s business interests (similar to
the question considered in cases of termination for off-duty conduct considered in Chapter 12);
administrative leave: A period of time during which an employer refuses an employee the right to report to work for reasons
other than a lack of work (i.e., a layoff) or discipline (i.e., a suspension), usually during the period of an ongoing investigation
into possible employee misconduct.

and (2) the leave is with pay.37 So, for example, in the 2018 case Filice v. Complex Services, the
Ontario Court of Appeal ruled that an administrative suspension of a security guard accused of
theft pending the outcome of an investigation was justified, but the decision of the employer to
treat the suspension as unpaid constituted a constructive dismissal.38

Disciplinary Unpaid Suspensions as Constructive Dismissal
Carscallen v. FRI Corp. tract. Therefore, the court considered whether it should imply
2006 CanLII 31723 (Ont. CA) such a right. Applying the tests for implying contract terms
(discussed in Chapter 9), the court ruled that there was no
Key Facts: Carscallen worked for FRI Corp. and was responsible implied term permitting unpaid suspensions: such a term was
for shipping certain materials to her boss who was attending not necessary to give “business efficacy” to the contract, and
a conference in Spain. She failed in this task, and her employer it was not obvious that both parties would have agreed that
responded by suspending her indefinitely without pay. such a term was part of the contract. Absent a contractual right
Carscallen quit and sued her employer for constructive to suspend Carscallen without pay, the suspension amounted
dismissal. to a constructive dismissal, unless Carscallen’s actions were so
Issue: Did the disciplinary unpaid suspension of Carscallen serious that the employer had cause for summary dismissal
amount to a fundamental breach of the employment contract without notice. The court considered the law of summary
and therefore a constructive dismissal when Carscallen quit in dismissal and found that Carscallen’s mistake was not serious
response to the suspension? enough to justify summary dismissal. Therefore, the employer
had no right to dismiss Carscallen for cause and no right to
Decision: Yes. The court noted that no expressed contractual suspend her without pay. Carscallen was entitled to damages
right to suspend without pay existed in the employment con- based on a period of nine months’ reasonable notice.
In its recent decision in Potter v. New Brunswick Legal Aid Services Commission, mentioned
earlier in the chapter, the Supreme Court of Canada considered whether an employer construct-
ively dismissed an employee by placing the employee on a paid “administrative suspension”
while it attempted to bargain a buyout of the employee’s fixed-term contract. The court ruled
that an employer has an implied right to place an employee on paid administrative leave if it
does so in good faith, and the suspension is both “reasonable and justified” in the circumstances.
The court ruled that the suspension of Potter failed to meet this standard because the employer
failed to communicate honestly with the employee about the reason for the suspension and was
also secretly exploring whether they could terminate Potter for cause.39
E. Employee Harassment or a Poisoned Work Environment

Recall from Chapter 9 that since the late 1990s, an implied contract term requires employers to
treat their employees with “decency, civility, respect, and dignity.” An employee subjected to
serious workplace harassment that violates that contract term could quit and sue for con-
structive dismissal.40 In addition, as we noted earlier in this chapter, courts have recently also
found that harassment or unfair treatment of an employee can lead to a constructive dismissal
finding if the court rules that a reasonable employee would conclude that the employer’s behav-
iour has made the workplace “intolerable” for the employee, even if the court does not rely on a
breach of any particular contract term.41
Therefore, as noted above, harassment or bullying by an employer can result in a constructive
dismissal finding applying either of the branches of constructive dismissal examined in this
chapter. However, not every little criticism or negative comment by an employer will be enough
to establish a constructive dismissal. For example, courts have said that the threshold must be
high enough to permit legitimate expressions of concern and frustration by an employer.42

A court is most likely to find a constructive dismissal when a representative of management

engaged in the harassment or the employer failed to take steps to investigate and stop harass-
ment by a co-worker once it became aware of it. For a refresher on this point, look back at the
case of Lloyd v. Imperial Parking Ltd.,43 discussed in Box 9.3 in Chapter 9.
IV. Employee Acceptance and Condonation of the Employer’s

Repudiation of Contract
The employer’s fundamental breach of contract does not itself bring the contract to an end. As
noted earlier, the employee must “accept” the employer’s repudiation of contract and treat the
contract as at an end by quitting.44 It is obvious why employees may not want to treat the
employer’s breach of contract as a constructive dismissal. To do so means losing one’s job. Many
employees just want the employer to comply with the contract; they do not want to quit. How-
ever, an employee faced with an employer breach of contract is in a difficult and vulnerable
position.45 When an employer commits a fundamental breach of an employment contract, the
employee essentially has three options, as summarized in Box 13.6.46

Employee Options When an Employer Repudiates an Employment Contract
When an employer “repudiates” an employment contract by Option 3: Protest the employer’s breach of contract,
committing a fundamental breach of the contract, the em- without quitting, and insist that the employer comply
ployee has the following three options:* with the original contract terms
The employee may choose not to quit in response to the
Option 1: “Condone” the employer’s breach of contract employer’s substantial breach of contract and instead insist
The employee can condone the employer’s breach of contract. that the original terms of the contract be complied with. The
This means that the employee does not object to it. If an em- employee must clearly indicate that they are not agreeing to
ployee condones a breach, they are prohibited from later the change or condoning the employer’s breach of contract.
trying to argue a constructive dismissal based on that breach. The employer then has the option of continuing to comply
However, an earlier breach of contract by an employer can still with the original contract terms or terminating the original
be relied upon later by an employee as forming part of a series contract by giving proper notice. If the employer allows an
of breaches that together amount to a cumulative effect con- employee to continue to work, despite the employee’s objec-
structive dismissal, a concept explained earlier in this chapter. tion to the employer’s breach, then the work is being per-
formed according to the terms of the original contract. If the
Option 2: “Accept” the employer’s breach of contract, and employer refuses to comply with those terms, the employee
treat the contract as terminated (constructive dismissal) can later sue the employer to enforce the original contract
The employee can “accept” the employer’s breach of contract terms.
by quitting and taking the position that the employer’s breach
brought the contract to an end. This option treats the em- * These options are discussed in Hill v. Peter Gorman Ltd., 1957 CanLII 393
ployer’s actions as a constructive dismissal. The employee must (Ont. CA); Wronko v. Western Inventory Service Ltd., 2008 ONCA 327; and
“accept” the breach—that is, quit—within a “reasonable” period Potter v. New Brunswick Legal Aid Services Commission, 2015 SCC 10; as
well as in Chapter 7.
of time, a malleable concept that is left to judges’ discretion.
In option two presented in Box 13.6, the employee must “accept” the employer’s repudiation
of contract within a reasonable time period. If the employee does not quit within a reasonable
time period, then the court may rule that the employee condoned the breach (option one) and
is therefore prohibited from treating it as a constructive dismissal.47 (Recall that if the employer
had unilaterally changed the contract terms for its own benefit, such as by reducing the employ-
ee’s compensation, the change must still be supported by mutual consideration to be enforce-
able, as we learned in Chapter 7.)

What constitutes a “reasonable” period of time depends on the facts in each case, and the
courts’ decisions on this point have varied widely. For example, one court found that an em-
ployee who did not quit for 11 days after changes to his contract were made had condoned the
breach.48 However, most judges have provided employees with a much longer period of time to
elect whether to quit.49 The Ontario Court of Appeal noted in one case that allowing employees
a reasonable time to reflect on their decision recognizes the vulnerability of employees and the
“difficulty of making … life-altering decisions” and also “promotes stability and harmonious
relations in the workplace.”50 Thus, for example, a seven-month delay before quitting was found
not to amount to condonation in Tilbe v. Richmond Realty Ltd.51
Let’s demonstrate the three options described in Box 13.6 by considering the situation of an
employee who shows up to work one day and is informed by their employer that their pay has
been cut by 50 percent.52 As we learned above, that change clearly amounts to a substantial
breach of contract. Now consider the three options available to the employee. First, they could
condone the change by not objecting and just continue to work under the changed terms (option
one). If they do that, then they cannot later quit and allege that they were constructively dis-
missed by virtue of the pay cut. Second, they could “accept” the breach of contract, quit, and sue
for constructive dismissal (option two). Third, they could reject the pay cut by clearly advising
their employer that they do not agree to the change (option three), but keep working. The em-
ployer could then respond by terminating the employee’s original contract with proper notice
and offer a new contract at a lower pay rate, as we learned in Chapter 7. However, if the employer
permits the employee to keep working, then that work is being performed under the terms of
the original contract.53 Continuing to work does not amount to agreement to the pay cut if the
employee has informed the employer that they do not agree to the change. If the employer starts
paying them the reduced rate, the employee can later sue for breach of contract to recover any
damages caused by that breach.
V. Chapter Summary

Constructive dismissal is a branch of the law of wrongful dismissal. It occurs when an em-
ployer commits a fundamental or “repudiatory” breach of the employment contract that the
employee elects to treat as having terminated the contract. Since a constructive dismissal
results in the termination of the contract by the employer, the employee may be entitled to
damages based on the failure of the employer to provide proper contractual notice of termin-
ation. Constructive dismissal law involves a complex balancing of the employer’s interest in
flexibility and the interest of employees in stability under their contracts of employment. We
saw that not every breach of contract is serious enough to justify a finding of constructive
dismissal and that employees must elect whether to treat a fundamental or repudiatory
breach of contract by the employer as a constructive dismissal within a reasonable amount
of time.

1. Describe the two “branches” of constructive dismissal.
2. What three questions do the courts consider when dealing with constructive dismissal
lawsuits involving an alleged substantial breach of the contract?
3. Describe the three options available to an employee confronted with an employer who
commits a fundamental breach of the employment contract.
4. Explain the meaning of the following terms in the context of constructive dismissal law:
(1) condonation, (2) acceptance, and (3) repudiation.
5. Why might an employee not want to treat a breach of contract by the employer as a con-
structive dismissal?

APPLYING THE LAW

1. In the summer of 2022, Lloyds Moving Company ex- move on and find another job. Lisa comes to you for
periences a slowdown in customers, and the owners advice. Explain whether Lisa could make a strong con-
decide they need to temporarily lay off three workers structive dismissal argument.
for one month, including Mark Alexander. Mark comes 3. The Great T-Shirt Factory is a large clothing company.
to you for advice. He is considering a move to Britain Sherry has been employed in the accounting depart-
and is not sure he wants to return to Lloyds Moving ment as a financial auditor for five years. The company
Company even if he is recalled to work next month. has decided to restructure the accounting department
Mark has been employed for 10 years, and he has nev- for business reasons and intends to transfer Sherry to a
er been laid off before. He never signed a written em- new position called “bookkeeper.” The new job will pay
ployment contract. Advise Mark of his legal options if the same as the financial auditor job Sherry currently
he decides to move to Britain. holds, and Sherry would report to the same manager
2. For several months now, Lisa has experienced sexual of accounting. The tasks would change slightly, with
harassment by her supervisor. The supervisor constant- Sherry doing less work on tax matters and more work
ly makes jokes about Lisa’s body and touches her on on tracking inventory and accounts receivable. Sherry
the shoulder and back and invites her for drinks and to is angry because she believes that moving from the
his apartment after work. She has asked him to stop job of “financial auditor” to “bookkeeper” sounds like a
talking to her and she has reported her concerns to demotion and will be perceived as such by her col-
the human resources manager, but no steps have been leagues. She raises these concerns with management
taken to ensure the supervisor’s behaviour changes. and management comes to you for advice. Do you
Lisa is fed up and suffering from anxiety and has de- think the change would give Sherry grounds for a con-
cided she can no longer come to work. She wants to structive dismissal claim?
EXERCISE
In Box 13.2, we considered the Supreme Court of Canada case of Farber v. Royal Trust Co. That
case has become the leading authority on constructive dismissal in Canada and, as such, has
been regularly cited in constructive dismissal cases since.
To learn how the courts have dealt with constructive dismissal, search for cases that reference
the Farber case. In this exercise, we “note up” the Farber case.
2. In the “Noteup” search box, type “Farber v. Royal Trust Co.” and select “Farber v. Royal
Trust Co., 1997 CanLII 387 (SCC)” from the drop-down menu that appears. That search
should result in hundreds of cases from the period after 1997. Select one of those cases and
read it.
3. Prepare a case summary that includes the key facts, the issue, and the decision as well as
answers to the following questions:
a. What contract term was alleged to be breached?
b. Was the contract term breached?
c. If so, was the breach found to be fundamental or repudiatory?
d. Did the employee condone the breach?
e. Did the constructive dismissal argument succeed? If yes, what damages were
awarded?

1. Potter v. New Brunswick Legal Aid Services Commission, of constructive dismissal in Quebec was essentially the
2015 SCC 10; Farber v. Royal Trust Co., [1997] 1 SCR 846. same as in the common law model.)
(Although the Civil Code of Quebec applied to the contract 2. Ibid. at para 30.
in Farber, the Supreme Court of Canada noted that the law

3. Murray v. Jets Hockey Ventures, 1996 CanLII 18145 (Man. 11. The Supreme Court preferred the word “substantial” over
QB) at para 13. “fundamental” breach in Potter, supra note 1 at paras 34-35.
4. Potter v. New Brunswick Legal Services, supra note 1; On the application of an “objective test,” see also Farber v.
Farber v. Royal Trust Co., supra note 1. Classic early British Royal Trust Co., supra note 1 at para 26; Halifax Herald
cases that explain the doctrine of repudiation of contract Limited v. Clarke, 2019 NSCA 31; Chapman v. GPM Invest-
based on behaviour evincing an intention to no longer ment Management, 2017 ONCA 227; Filice v. Complex Ser-
be bound by the contract include Rubel Bronze & Metal vices Inc., 2018 ONCA 625; Orth v. Macdonald Dettwiler &
Co. v. Vos, [1918] 1 KB 315; and Western Excavating (ECC) Associates Ltd., 1986 CanLII 170 (BCCA); General
Ltd. v. Sharp, [1978] ICR 221 (CA). Repudiation of con- Motors of Canada Ltd. v. Johnson, 2013 ONCA 502; and
tract can also be established based on an indication of an R.S. Echlin & J. Fantini, Quitting for Good Reason: The Law
intention to commit a fundamental breach of contract. of Constructive Dismissal in Canada (Aurora, ON: Canada
When the employer announces to the employee that Law Book, 2001) at 20. Note that in the Potter decision, the
it intends to take action that would amount to a Supreme Court ruled that courts can consider evidence of
fundamental breach of contract, it is known as an the employer’s behaviour that was not known to the em-
“anticipatory breach of a fundamental term of the con- ployee at the time they quit in assessing whether the em-
tract.” The employee can respond by advising the employer breached the contract, but cannot consider this
ployer that they will accept the repudiation and treat the evidence in relation to the second question, which is
contract as at an end: Davies v. Canadian Satellite Radio whether a reasonable employee would have considered the
Inc., 2010 ONSC 5628. employer’s breach was “substantial.”
5. The importance of “acceptance” of the repudiation is 12. Farquhar v. Butler Brothers Supplies Ltd., supra note 5.
explained in this often-cited passage from Howard v. Pick- 13. Farber v. Royal Trust Co., supra note 1 (change would lead
ford Tool Co. Ltd., [1951] 1 KB 417 at 421: “An unaccepted to an estimated 50 percent pay cut); Davies v. Canadian
repudiation is a thing writ in water and of no value to Satellite Radio Inc., supra note 4 (60 percent pay cut was a
anybody: it confers no legal rights of any sort or kind.” See fundamental breach); Olsen v. Sprung Instant Greenhouses
also Farquhar v. Butler Brothers Supplies Ltd., 1988 CanLII Ltd. (1985), 12 CCEL 8 (Alta. QB) (45 percent pay cut was
185 (BCCA); and Lemay v. Canada Post Corp., 2003 CanLII fundamental); Evans v. Fisher Motor Co. Ltd., [1915] 8
36637 (Ont. Sup Ct J). OWN (H Ct J) (33 percent pay cut); Farquhar v. Butler
Brothers Supplies Ltd., supra note 5 (30 percent pay cut);
6. Kussmann v. AT & T Capital Canada Inc., 2002 BCCA 281;
Ziten v. Sadie Moranis Realty Corporation, 2015 ONSC 7987
Luth v. Norwood Project Management Ltd., 1995 CanLII 853
(40 percent pay cut); Bisnar v. Caltec Scientific Ltd., [1995]
(BCSC); and Drapeau v. Spielo Manufacturing Incorporated,
BCJ No. 2915 (QL) (PC) (20 percent pay cut); Bergmann v.
2007 NBQB 113.
CPT Canada Power Technology Ltd., 1997 CanLII 14843
7. Potter, supra note 1. (Alta. QB) (25 percent pay cut); Evangelista v. Number 7
8. Shah v. Xerox Canada Ltd., 2000 CanLII 2317 (Ont. CA). Sales Limited, 2008 ONCA 599 (cut in commission sales-
See also Whiting v. Winnipeg River Brokenhead Community person’s rate from 18 percent to 9 percent of gross profits);
Futures Development Corp., 1998 CanLII 19422 (Man. CA); and Luth v. Norwood Project Management Ltd., supra note 6
and Colistro v. Tbaytel, 2019 ONCA 197 (workplace rendered (15 percent pay cut).
intolerable when employer hired a person who years earlier 14. Pullen v. John C. Preston Ltd. (1985), 7 CCEL 91 (Ont. H Ct
sexually harassed an existing employee). The Supreme Court J); aff ’d (1987), 16 CCEL xxiii (CA) (reduction in a base
of Canada affirmed the legitimacy of this branch in Potter v. salary from $30,000 to $27,000 was not a fundamental
New Brunswick Legal Services, supra note 1 at paras 33, 42. breach).
Other cases applying this approach can be located by “noting
15. Benell v. William E. Coutts Co. (1994), 50 ACWS (3d)
up” Shah v. Xerox on the CanLII website.
241 (Ont. Sup Ct J). See also English v. Toyota Plaza Ltd.,
9. See Potter, supra note 1 at paras 42, 47; and Colistro v. 1995 CanLII 10467 (Nfld. SC) (the imposition of a
Tbaytel, supra note 8 at para 52. requirement for the employee to pay the $850 cost of a
10. Colistro v. Tbaytel, supra note 8 at para 50 (noting that in training program amounted to constructive dismissal);
the case of harassment, the two branches overlap since the and Pulak v. Algoma Publishers Ltd., 1995 CanLII 7277
employee could rely on the implied term requiring civility (Ont. Sup Ct J) (10 percent cut to base pay was a
and decency or the Shah v. Xerox approach requiring that constructive dismissal).
the employee demonstrate that continued employment is 16. Poole v. Tomenson Saunders Whitehead Ltd., 1987 CanLII
intolerable). See analysis in D. Doorey, “Employer Bullying: 2647 (BCCA); Hamilton & Olsen Surveys Ltd. v. Otto, 1993
Implied Duties of Fair Dealing in Canadian Employment ABCA 233; Pathak v. Jannock Steel Fabricating Company
Contracts” (2005) 30 Queen’s LJ 500. (1996), 21 CCEL (2d) 12 (Alta. QB); Chapman v. Bank of

Nova Scotia, 2007 CanLII 18732 (Ont. Sup Ct J); Wylds v. 26. See, for example, Stacey v. Consolidated Foods Corp. of
Burns Fry Ltd., [1993] OJ No. 1042 (QL) (Gen Div); and Canada Ltd. (1987), 15 CCEL 113 (NSSC) (express term
Leversage v. Swan Valley Foods Ltd. (1982), 16 ACWS (2d) allowing reassignment).
223 (BCCA). 27. Holgate v. Bank of Nova Scotia, 1989 CanLII 4660
17. Poole v. Tomenson Saunders Whitehead Ltd., supra note 16; (Sask. QB) (a “very slight” demotion was not a fundamental
Chapman v. Bank of Nova Scotia, 2008 ONCA 769; and breach); McColm v. Perth Services Ltd., 1998 CanLII 28136
Brent Chapman v. GPM Investment Management and (Man. QB) (a “minor reduction” in responsibilities did not
Integrated Asset Management Corporation, 2015 ONSC constitute a constructive dismissal); and Longman v.
6591 (failure to pay a 10 percent bonus not grounds for Federal Business Development Bank, supra note 22 (a
a constructive dismissal). “partial diminution in the employee’s status” was not a con-
18. Wood v. Owen De Bathe Ltd., 1998 CanLII 6578 (BCSC), structive dismissal).
aff ’d 1999 BCCA 29; and Piron v. Dominion Masonry Ltd., 28. Corker v. University of BC, 1990 CanLII 748 (BCSC) at 253;
2013 BCCA 184. Duggan v. Cowichan Family Life Assn., 1999 CanLII 5979
19. MacKenzie v. Ralston Purina Canada Inc. (1981), 9 ACWS (BCSC); and Mackay v. Avco Financial Services Canada
(2d) 110; and Tymrick v. Viking Helicopters Ltd. (1985), 6 Ltd., 1996 CanLII 3752 (PE SCTD).
CCEL 225 (Ont. H Ct J). 29. Karjanlathi v. Tamrock Canada Inc., 1993 CanLII 1536
20. Canadian Bechtel Ltd. v. Mollenkopf (1978), 1 CCEL 95 (BCSC).
(Ont. CA) at 98. See also Gillespie v. Ontario Motor League 30. Smith v. Viking Helicopter Ltd., 1989 CanLII 4368 (Ont.
Toronto Club (1980), 4 ACWS (2d) 87 (Ont. H Ct J); and CA). See also Morris v. Int’l Harvester Canada Ltd. (1984),
Black v. Second Cup Ltd., 1995 CanLII 7270 (Ont. Sup Ct J). 7 CCEL 300 (Ont. H Ct J); Canadian Bechtel Ltd. v. Mollen-
21. See comments in Stein v. British Columbia Housing Man- kopf, supra note 20; and Stefanovic v. SNC Inc. (1988), 22
agement Commission, 1992 CanLII 4032 (BCCA). CCEL 82 (Ont. H Ct) (transfer from Toronto to Montreal
22. Canadian Bechtel Ltd. v. Mollenkopf, supra note 20; Pullen v. not a constructive dismissal).
John C. Preston Ltd., supra note 14; and Longman v. Federal 31. Jim Pattison Industries Ltd. v. Page, 1984 CanLII 2728 (Sask.
Business Development Bank, 1982 CanLII 543 (BCSC). CA); Hermann v. ManAlta. Coal Ltd. (1978), 16 AR 322
23. See, for example, Zifkin v. Axa Insurance (Canada), 1996 (SC); Durrant v. Westeel-Rosco Ltd., 1978 CanLII 277
CanLII 10441) (Alta. QB); Murray v. Jets Hockey Ventures, (BCSC); and Stefanovic v. SNC Inc., supra note 30.
supra note 3; Robinson v. Tingley’s Ltd. (1988), 20 CCEL 263 32. See, for example, Weselan v. Totten Sims Hubicki Associates
(NBQB) (a long-service meat cutter was reassigned to the Ltd., 2001 CanLII 9431 (Ont. CA) (extra commuting time
grocery department); Herrschaft v. Vancouver Community and the cost associated with driving from home in Simcoe
College (1978), 91 DLR (3d) 328 (BCSC); and Blondeau v. to a new job in St. Catharines would result in substantial
Holiday Ford Sales (1980) Ltd., 2005 CanLII 8672 (Ont. CA) change in conditions and therefore was a constructive dis-
(a customer service rep was reassigned to a job performing missal); Lukings v. I.M.A.W., Region 8, [1988] OJ No. 742
various “menial routine tasks”). See also Dykes v. Saan (Div Ct) (the cost of housing in Calgary made the refusal to
Stores Ltd., 2002 MBQB 112. agree to a transfer from London, Ontario, reasonable, and
24. Mifsud v. MacMillan Bathurst Inc., 1989 CanLII 260 (Ont. the transfer was a constructive dismissal); and Antworth v.
CA); Morgan v. Vitran Express Canada Inc., 2015 ONCA Fabricville, 2009 NBQB 54 (a change in job requiring much
293; Clarke v. Halifax Herald Ltd., 2017 NSSC 337; Farber v. greater travel amounted to a constructive dismissal).
Royal Trust, supra note 1; Reber v. Lloyds Bank International 33. Elsegood v. Cambridge Spring Service, 2011 ONCA 831 at
Canada, 1984 CanLII 712 (BCSC); Robinson v. H.J. Heinz para 14. Note too that the fact that employment standards
Company of Canada LP, 2018 ONSC 3424; Roberts v. Versa- legislation permits a temporary layoff does render a layoff
tile Farm Equipment Company, 1987 CanLII 4764 (Sask. permissible under the common law. But see Trites v. Renin
QB); Newsham v. Indal Limited, 1986 ABCA 101; Ally v. Corp., 2013 ONSC 2715, finding that a temporary layoff
Institute of Chartered Accountants (1992), 92 CLLC 14,039 that complies with employment standards legislation
(Ont. Sup Ct J); Chandran v. National Bank of Canada, cannot give rise to a constructive dismissal. This reasoning
2012 ONCA 205; and Fasenko v. Flag Chevrolet-Geo- has not been adopted by other judges. See also Bevilacqua
Oldsmobile (1994), 5 CCEL (2d) 82 (BCSC). But see Gillis v. v. Gracious Living Corporation, 2016 ONSC 4127; Gent v.
Sobeys Group Inc., 2011 NSSC 443 (court ruling that the Strone Inc., 2019 ONSC 155; Martellacci v. CFC/INX Ltd.,
elimination of an employee’s management job at the head 1997 CanLII 12327 (Ont. Gen Div); Janice Wiens v. Davert
office and reassignment to a lower-paying assistant store Tools Inc., 2014 CanLII 47234 (Ont. Sup Ct J) (court finds
manager position was not a constructive dismissal). an implied term allowing for temporary layoffs based on
25. Farber v. Royal Trust Co., supra note 1 at 197. the industry norm, but not “indefinite” layoffs); Chevalier v.

Active Tire & Auto Centre Inc., 2012 ONSC 4309; Collins v. Brokenhead Community Futures Development Corp., supra
Jim Pattison Industries Inc. (1995), 11 CCEL (2d) 74 note 8.
(BCSC); McLean v. The Raywal Limited Partnership, 2011 42. Danielisz v. Hercules Forwarding Inc., 2012 BCSC 1155;
ONSC 7330; Pryor v. Taylor’s Feed, 2009 NBQB 346; and and Baraty v. Wellons Canada Corp., 2019 BCSC 33.
Turner v. Uniglobe Custom Travel Ltd., 2005 ABQB 513.
43. Lloyd v. Imperial Parking Ltd., 1996 CanLII 10543 (Alta.
34. Mackay v. Avco Financial Services Canada Ltd., supra note QB).
28; and Pierce v. Canada Trust Retailer (1986), 11 CCEL 64
44. Gunton v. Richmond-upon-Thames London Borough
(Ont. H Ct J).
Council, [1981] 1 Ch. 488 (CA).
35. This principle has deep roots. See, for example, Hanley v.
45. See comments in Belton v. Liberty Insurance Co. of Canada,
Pease and Partners Ltd., [1915] 1 KB 698 at 705. See also
2004 CanLII 6668 (Ont. CA) at para 25.
Haldane v. Shelbar Enterprises Limited, 1999 CanLII 9248
(Ont. CA); and Carscallen v. FRI Corp., 2006 CanLII 31723 46. See, for example, Russo v. Kerr, 2010 ONSC 6053; Hill v.
(Ont. CA). Peter Gorman Ltd., 1957 CanLII 393 (Ont. CA); and
Wronko v. Western Inventory Service Ltd., 2008 ONCA 327.
36. Kellas v. CIP Inc., 1990 CanLII 412 (BCSC).
47. Farquhar v. Butler Brothers Supplies Ltd., supra note 5.
37. Cabiakman v. Industrial Alliance Life Insurance Co., 2004
SCC 55; Potter, supra note 1. 48. Polo v. Calgary (City), 1994 ABCA 359.
38. Filice v. Complex Services Inc., 2018 ONCA 625 (court notes 49. See, for example, Campbell v. MacMillan Bloedel Limited,
that while it is possible that an administrative suspension 1978 CanLII 2602 (BCSC) (the employee could quit two
without pay pending the outcome of an investigation into months after the employer’s breach); Pathak v. Jannock Steel
wrongdoing could be justified, that would be Fabricating Company, supra note 16 (a three-month delay
“exceptional”). was not condonation); Kussmann v. AT & T Capital, 2000
BCSC 268 (a two-month delay was not condonation); and
39. Potter, supra note 1.
Streight v. Dean, 2002 BCSC 399 (a two-month delay was
40. Morgan v. Chukal Enterprises Ltd., 2000 BCSC 1163; not condonation). Contrast these decisions to Wedding v.
Saunders v. Chateau Des Charmes Wines Ltd., 2002 CanLII Motorola Canada Limited, 1999 BCCA 752 (an 11-month
5114 (Ont. Sup Ct J); Stamos v. Annuity Research & delay before quitting amounts to condonation); and Anstey
Marketing Service Ltd., 2002 CanLII 49618 (Ont. Sup Ct J); v. Fednav Offshore Inc. (1990), 34 FTR 190 (TD) (a two-year
Ulmer Chevrolet Oldsmobile Cadillac Ltd. v. wait under changed terms amounted to condonation).
Kowerchuk, 2005 SKPC 18; Lamb v. Gibbs Gage Architects,
50. Belton v. Liberty Insurance Co. of Canada, supra note 45 at
2011 ABPC 315; Hanni v. Western Road Rail Systems
para 26.
(1991) Inc., 2002 BCSC 402; Vandooyeweert v. Jensten
Foods Ltd., 2002 BCPC 422; Prabhakaran v. Town of Fort 51. Tilbe v. Richmond Realty Ltd., 1995 CanLII 738 (BCSC).
Macleod, 2010 ABPC 35; Rothberger v. Concord Excavating 52. See Russo v. Kerr, supra note 46.
& Contracting Ltd., 2015 BCSC 729; Sweeting v. Mok, 2015 53. Wronko v. Western Inventory Service Ltd., supra note 46. In
ONSC 4154; and Colistro v. Tbaytel, supra note 8. In Colwell Russo v. Kerr, supra note 46, the employee’s lawyer had
v. Cornerstone Properties Inc., 2008 CanLII 66139 written to the employer advising that the employee’s pos-
(Ont. Sup Ct J), the court described the implied term as a ition was that the unilateral pay cut was a constructive dis-
mutual duty to “treat the other in good faith and fairly” missal. The court relied on this letter as the evidence to
(the installation of hidden cameras in a manager’s office prove that the pay cut had been “accepted” as a constructive
was a constructive dismissal). In Boucher v. Wal-Mart dismissal by the employee notwithstanding the employee’s
Canada Corp., 2014 ONCA 419, the court dealt with continuation in the job. However, in that case the employee
harassment of a female employee. It found a constructive claimed and the court accepted that when the employee
dismissal based on a breach of an implied term requiring continued to work after objecting to the pay cut, he was in
“good faith and fair dealing.” fact mitigating his loss. This is explained in Chapter 14
41. Potter, supra note 1; Shah v. Xerox Canada Ltd., when we consider the duty to mitigate damages in wrongful
supra note 8. See also Whiting v. Winnipeg River dismissal cases.

C H A P T E R 14
Damages in Wrongful Dismissal

Lawsuits
II. General Theory of Damages and Absence of “Specific Performance” 217
• Describe the three categories of damages that can be awarded
III. Categories of Damages in Wrongful Dismissal Lawsuits 219
in wrongful dismissal lawsuits.
A. Compensatory (or Ordinary) Damages 219
• Explain the legal tests applied by the courts to determine which B. Aggravated Damages for Bad Faith in the Manner of Dismissal 222
(if any) category of damages applies in a wrongful dismissal C. Punitive Damages 225
lawsuit. IV. The Duty to Mitigate Compensatory Damages 226
• Define specific performance and how it is applicable to wrongful A. The Standard of Mitigation Required 227
dismissal lawsuits. B. Mitigation with a Job Offered by the Former Employer 227
• Describe how an employee’s “duty to mitigate” affects wrongful V. Chapter Summary 229
dismissal damages. Questions and Issues for Discussion 230
Exercise 230
I. Introduction
If an employee wins a “wrongful dismissal” lawsuit, what do they win? The key to answering this
question is to remember what the employer did wrong: it breached the term in the employment
contract requiring it to provide the employee with notice of termination. It was not the termina-
tion itself that was illegal, since the employer can dismiss an employee by providing notice unless
the contract states otherwise. Therefore, the courts ask what loss the employee suffered as a con-
sequence of not receiving notice, and then order the employer to pay damages (money) to the
employee to compensate for that loss. This chapter explains how the courts approach that task.
II. General Theory of Damages and Absence of

“Specific Performance”
When an employer dismisses an employee without giving proper notice (and absent cause for
summary dismissal), this action repudiates the contract and the contract comes to an end.1 The
employee can then sue the employer for wrongful dismissal to recover damages incurred as a
result of the employer’s failure to provide proper notice.2 The Supreme Court of Canada has
damages: An amount of money a party guilty of a contract or tort violation is ordered to pay the innocent party to compensate
the person for the harm incurred.
217

explained that damages for breach of contract should “as far as money can do it, place [the
innocent party] in the same position as if the contract had been performed.”3 Therefore, in a
wrongful dismissal lawsuit, the courts assess what money and benefits employees would have
received had they worked the notice period.
Imagine that Jacqueline’s contract entitled her to three months’ notice of termination, but she
is dismissed without notice. What has Jacqueline lost by being dismissed without that notice?
Well, she has lost the opportunity to physically perform work for the employer for those three
months. Her lawsuit will not likely come before a judge until those three months have long
passed. However, in theory, the judge could order the employer to rehire Jacqueline for an addi-
tional three months to put her back into the position she would have been in had the contract
been complied with. A court order requiring someone to perform their obligations under a
contract is known as specific performance. In the context of wrongful termination of an employ-
ment contract, this remedy would mean that either the employer must re-employ a dismissed
employee or the employee who quit in a manner that breached the contract must return to work.
However, the courts do not, except in very rare circumstances,4 order specific performance
of an employment contract.5 If one of the parties to the employment contract wants the employ-
ment relationship to end, then the common law courts have reasoned that it makes little sense
to order it to continue. Justice Lambert of the British Columbia Court of Appeal captured this
sentiment:
It is not consistent with our respect for human dignity and freedom of choice to enforce an employ-
ment relationship against the wishes of one of the parties.6
The inability to obtain specific performance of an employment contract means that dis-
missed employees who win wrongful dismissal lawsuits will not get their job back.7 Their job is
gone, unless the employer voluntarily decides to offer a new employment contract. We should
pause here to note that the notion that forcing an employment relationship to continue against
the wishes of one party is inconsistent with human dignity and freedom is not universally
applied throughout the law of work. For one thing, as we will see later in this chapter, the com-
mon law courts have not applied this same logic when the situation is flipped: the courts do
expect employees to return to work against their wishes in the context of the “duty to mitigate.”
Also, as we will learn in Parts III and IV of the text and as summarized in Box 14.1, in both the
regulatory and collective bargaining regimes, expert administrative tribunals regularly reinstate
employees against the wishes of employers.

Reinstatement of Dismissed Employees Under the Three Regimes of Work Law
In the common law regime, judges do not, except in rare cir- latory standards regime and the collective bargaining re-
cumstances, order the reinstatement of employees who gime, employees can be reinstated when they are dismissed
have been dismissed without notice (wrongfully dismissed). improperly.
Even if an employer fires an employee for theft but it turns In the regulatory standards regime, employers are restricted
out that no theft occurred, all that the employee will be from dismissing employees for certain reasons. For example,
awarded is damages of the sort discussed in this chapter. human rights legislation prohibits dismissal of an employee
This approach stands in sharp contrast to that of the other for reasons related to prohibited grounds of discrimination,
two regimes of work law considered in this text: in the regu- such as race, gender, and religion. Other employment-related
specific performance: An order by a court requiring a party found to have breached a contract to carry out its obligations
as specified in the contract.

Chapter 14 Damages in Wrongful Dismissal Lawsuits 219
legislation, such as employment standards and occupational improper dismissal of an employee is one of the key features
health and safety legislation, prohibits dismissal of employees that distinguishes the common law from the collective bar-
who attempt to enforce their statutory rights (anti-reprisal gaining regime. We will learn about this law in Part IV.
laws). The remedy for dismissals that violate protective em- The use of varying approaches to reinstatement as a rem-
ployment legislation can include reinstatement of the em- edy in employment termination cases creates a mishmash of
ployee to their former job. In a few Canadian jurisdictions rights and remedies for Canadian employees that depends on
(federal, Nova Scotia, and Quebec), non-union employees who (1) where and for whom the employee works, and (2) the
have been dismissed have access to a statutory unfair dismissal reason for the termination. Only in the common law regime is
process that can lead an adjudicator to reinstate them to their the remedy for termination of an employment contract re-
jobs.* We will consider these statutory rules in Chapter 20 in stricted to monetary damages.
Part III.
In the collective bargaining regime, unions bargain clauses * See the discussion of these statutory unfair dismissal schemes in
into collective agreements that prohibit employers from dis- G. England, Individual Employment Law, 2nd ed (Toronto: Irwin Law,
2008) at 364-92.
missing employees without “just cause.”† No right exists to
dismiss a unionized employee without cause simply by giving † See D. Brown & D. Beatty, Canadian Labour Arbitration, 4th ed (Aurora,
ON: Canada Law Book, 2006) at chapter 7. See the discussion of the
notice, as is the case for non-union employees in the common origins of the arbitral presumption that reinstatement is the
law regime. In labour arbitration, the forum that decides col- appropriate remedy in unjust dismissal cases in the unionized setting in
lective agreement disputes, the presumption is that reinstate- M. Mitchnick & B. Etherington, Labour Arbitration in Canada (Toronto:
ment is the appropriate remedy in cases of “unjust dismissal” Lancaster House, 2006) at 118-19.
of a unionized employee. The availability of reinstatement for
III. Categories of Damages in Wrongful Dismissal Lawsuits

Three general categories of damages are available to employees in wrongful dismissal lawsuits:
1. Compensatory damages (sometimes called “ordinary” damages).

2. Aggravated or “moral” damages for bad faith in the manner of dismissal.
3. Punitive damages.
Each serves a distinct purpose. The first two compensate employees for harms suffered as a
result of the employer’s wrongful behaviour. Punitive damages, on the other hand, serve the
broader purpose of retribution, deterrence, and denunciation in cases where employers have
behaved so reprehensibly that the courts believe punishment is necessary. A summary of these
three “heads of damage” (categories of damages) appears in Table 14.1.
A. Compensatory (or Ordinary) Damages

The financial losses that flow naturally from the fact that the employee was not permitted to
work the notice period are known as compensatory damages. The courts determine the proper
length of notice by applying the Bardal factors we discussed in Chapter 10, and then calculate
what payments and benefits the employee would have received had they worked through that
period.8 The British Columbia Court of Appeal nicely summarized the approach of Canadian
courts:
If the employer terminates the employment contract without just cause and without giving reason-
able notice of termination, the employee is considered to have been wrongfully dismissed and is
entitled to damages equal to the employee’s salary and benefits that would have accrued during the
period of notice that should have been given by the employer.9
compensatory damages: Damages that compensate the innocent party for the direct loss of benefits they would have earned
had the contract not been violated by the guilty party.

TABLE 14.1 Damages in Wrongful Dismissal Cases

Category of Damages Basis for Recovery Test for Recovery
Compensatory damages* The employee lost contractual benefits What losses would reasonably have been contemplated by the
that would have been received had they parties had they considered what the employee would lose if the
worked through the notice period, employer terminated the contract without giving proper notice?
including wages and other benefits. Leading case: Hadley v. Baxendale (1854)
Aggravated or “moral” The employee experienced mental pain Since Wallace v. United Grain Growers Ltd. (1997), the courts assume
damages for bad faith in and suffering or hurt feelings as a result that the parties contemplated that employees will suffer mental
the manner of dismissal of harsh, insensitive, or dishonest pain and suffering if terminated in a harsh, insensitive, or dishonest
behaviour by the employer in the manner. However, the employee must demonstrate that real
manner in which the employee’s physical or psychological harm occurred and that harm was caused
contract was terminated. by the manner of dismissal (as opposed to the dismissal itself ).
Leading case: Honda Canada Inc. v. Keays (2008)

Punitive damages The employer’s behaviour was so repre- The employer’s outrageous behaviour must amount to an
hensible and outrageous that the law “independent actionable wrong” beyond the breach of the notice
should punish the employer beyond the of termination clause. Often this independent wrong will be breach
mere ordering of compensatory and of an expressed or implied term of the contract requiring the
aggravated damages. The goal is to employer to treat the employee with decency and in good faith.
advance the objectives of “denuncia- The court must also find that the goals of “denunciation, deter-
tion, deterrence, and retribution.” rence, and retribution” are not sufficiently addressed by other
damages.
Leading case: Honda Canada Inc. v. Keays (2008)
* Subject to the employee’s “duty to mitigate.”
In assessing compensatory damages, judges apply the reasonable contemplation test origin-
ally developed in 1854 in the famous case of Hadley v. Baxendale.10 The rule is that damages are
recoverable for a breach of contract to the extent that the parties would reasonably have contem-
plated that the damages would result if, at the time the contract was formed, they had considered
what harms the employee would suffer if dismissed without notice.
Consider a silly example. If an employee who has just been dismissed without notice finds
himself suddenly with time on his hands and goes golfing, during which his leg is bitten off by
an alligator hiding in a sand trap, he cannot recover damages for the lost leg from the employer
in a wrongful dismissal lawsuit. Although he would not have been golfing that day “but for”
his sudden and wrongful dismissal, neither party would reasonably have contemplated an alli-
gator attack in the event that the employer dismissed the employee without notice. We call
damages that could not have been reasonably contemplated by the parties too “remote” to be
recoverable.11
Some losses arising from a failure of the employer to give proper notice to the employee are
easily contemplated. Obviously, an employee dismissed without notice will lose out on the wages
and other benefits that would have been earned had they worked the notice period. Provided
that the employee can prove they suffered those losses, damages would be awarded to compen-
sate the employee—to put the employee back into the financial position they would have been
in had they worked the notice period.12 Lost wages for the notice period are usually easy to
reasonable contemplation test: The test of contract damage “remoteness” from the 1854 case of Hadley v. Baxendale. It
provides that damages for breach of contract are available only for harms that the parties would reasonably have contemplated
at the time the contract was formed.

calculate. If the evidence establishes that the employee would have received a raise or worked
overtime at an additional rate of pay during the notice period, then those amounts will also be
included in the calculation of lost wages.13
An employee may also have been entitled to payments or benefits other than wages during
the notice period. For example, the value of pension contributions or pension benefits that
would have been earned or accrued during the notice period is usually recoverable.14 So would
the value of other benefits the employee would have received during the notice period, such as
vacation pay or vacation time;15 a car allowance, provided that the benefit was a component of
the employee’s compensation and not simply a reimbursement of actual expenses incurred in
the course of working;16 and the value of stock options that the employee would have been en-
titled to exercise within the notice period.17
If the employer cancelled health, dental, and life insurance benefits coverage during the
notice period, the lost value of those benefits is recoverable in a successful wrongful dismissal
case. Cancelling a dismissed employee’s benefits before the notice period expires could prove
costly for an employer. For example, if an employee becomes disabled during the notice period,
but disability insurance benefits have been cut off, the employer will be liable for the amounts
the employee would have received from the insurance company.18 Similarly, if a dismissed em-
ployee pays out of pocket for dental visits or other medical costs that would have been covered
by the employer’s benefits plan, the employer would be ordered to reimburse the employee for
such costs. A dismissed employee with employer-provided dental benefits should rush to the
dentist and get all that expensive work done before the notice period expires!19
If a payment such as a commission or bonus was payable at the discretion of the employer,
or the evidence establishes that the employee would not have qualified for such a payment even
if they had worked through the notice period, then it likely will not be ordered by a court in the
damage award.20 However, if the contract language or the facts confirm that the employee would
have received the commission or bonus had they worked the notice period, then that loss will
also be included in the damage award.21 Box 14.2 examines the relationship with the assessment
of reasonable notice and damages for lost benefits.

Damages for Benefits That Would Have Vested During the Notice Period
Gillies v. Goldman Sachs Canada Inc. Issue: Did the trial judge make an error in fixing the period of
2001 BCCA 683 reasonable notice at 12 months, thereby leaving Gillies outside
the vesting date of the IPO shares?
Key Facts: Gillies was dismissed on April 30, 1998, from
his job as a securities salesman for Goldman Sachs Canada Decision: Yes. The court of appeal explained that if Gillies
Inc. with just under five years’ service. He had been paid by would have satisfied the qualifying conditions had he worked
a combination of salary and an annual bonus. In May 1999, out the notice period, then he would be entitled to the value
the company submitted an initial public offering (IPO) to take of the IPO shares. To qualify, the notice period would need to
the company public. Any employee employed as of March continue until at least May 3, 1999, the date of vesting for
1999 and still employed on May 3, 1999, was entitled to re- Goldman Sachs employees. The court of appeal found that 12
ceive stocks in the new company. The lower court fixed the months’ notice was “on the low end,” considering the Bardal
period of reasonable notice at 12 months. Since that period factors we learned about in Chapter 10. Moreover, the fact that
ended three days prior to May 3, 1999, the court ruled that 12 months left Gillies just three days short from qualifying for
Gillies would not have qualified for the IPO shares. Gillies the IPO shares served an injustice. The court of appeal ex-
appealed. tended the notice period to 13 months, with the result that
Gillies qualified for the IPO shares. The calculation of damages
was sent back to the trial judge to decide.

In short, calculating general damages arising from a wrongful dismissal requires identifica-
tion of what the employee has lost by not working through the entire notice period, and then an
assessment of the financial cost of that loss.
B. Aggravated Damages for Bad Faith in the Manner of Dismissal

The Supreme Court of Canada has recognized that being fired is a stressful event, and that sud-
den job loss can negatively impact the employee’s self-esteem, confidence, and personal dig-
nity.22 Dismissed workers often suffer distress, hurt feelings, and psychological harm (including
anxiety and depression) as a result of the termination, harm that is not easily quantifiable.
Should an employee be able to recover money from the employer for these harms, in addition
to the compensatory damages they suffered from the failure of the employer to give proper
notice?
Historically, the courts said that they should not. The general rule was that an employee
cannot recover damages for the hurt feelings or mental pain and suffering—known as aggravated
damages—they experience as a result of being terminated.23 Since the parties agreed that the
contract could be terminated with notice, the possibility of the employee losing their job was
anticipated. Therefore, damages for hurt feelings arising from that inevitability were not recov-
erable. However, the courts’ approach has evolved in recent years.
In 1997, the Supreme Court decided in the case of Wallace v. United Grain Growers Ltd. that
damages for mental suffering or hurt feelings could be awarded to a dismissed employee if the
employer engages in “bad faith in the manner of dismissal.”24 The court ruled that an employer
should be “candid, reasonable, honest and forthright” with employees in the manner in which
they terminate the employment contract.25 A failure to meet this standard would be treated as
bad-faith discharge. Damages for bad-faith discharge would be awarded by extending the
period of reasonable notice. For example, an employee who would otherwise be entitled to eight
months’ reasonable notice, applying the Bardal factors we discussed in Chapter 10, might be
awarded ten months’ notice if the court ruled that the manner in which the employee was dis-
missed was in bad faith. Bad faith in the manner of dismissal became a new factor, added to the
Bardal factors, that judges consider in assessing the period of reasonable notice.
In the years that followed Wallace, many employees included claims for “Wallace damages”
in their wrongful dismissal lawsuits. In dozens of cases, judges extended the notice periods
when they felt employers were unduly insensitive in the manner in which they dismissed
employees.26 When Wallace damages were ordered, they tended to be in the range of an addi-
tional one to four months added to the period of reasonable notice.27 Wallace damages became
common in the years following the release of the decision—so much so that judges began to
question whether the Wallace approach to aggravated damages was working.28 When the issue
of damages for bad faith in the manner of dismissal again came before the Supreme Court a
decade after the Wallace decision in the 2008 case of Honda Canada Inc. v. Keays, the Supreme
Court altered its approach, as Box 14.3 explains.29
aggravated damages: Damages awarded to the innocent party that compensate for mental or psychological pain and suf-
fering caused by the guilty party’s wrongful act.
bad-faith discharge: When an employer dismisses an employee in a manner that is dishonest, harsh, or insensitive to the
feelings and vulnerability of the employee.
Wallace damages: A phrase commonly used in wrongful dismissal decisions in Canada to describe damages ordered against
an employer for acting in bad faith in the manner in which it terminated an employment contract. Wallace v. United Grain Growers
Ltd. (1997) was the Supreme Court of Canada decision in which these damages were first ordered.


Damages for Bad-Faith Discharge
Honda Canada Inc. v. Keays was entitled to compensatory damages based on 15 months’
2008 SCC 39 notice.
On the question of aggravated damages arising from the
Key Facts: Keays had been employed by Honda Canada Inc. manner in which Keays was dismissed, the Supreme Court
for 11 years when he became ill. The employer requested reconsidered its earlier Wallace approach. While damages are
medical letters explaining his absences, but was unsatisfied still recoverable for bad faith in the manner of dismissal, those
with the letters prepared by Keays’s doctor. Therefore, the damages will no longer be assessed simply by extending the
employer demanded that Keays be evaluated by a doctor period of reasonable notice. Instead, such damages would be
chosen by the employer. Keays refused to see the employer’s assessed according to the general rule we learned about
doctor unless the employer first explained the purpose and earlier in this chapter, from Hadley v. Baxendale. That case
methodology that would be used by the doctor. In response, found that contract damages are only recoverable if they were
Honda terminated Keays for cause (summary dismissal; see within the “reasonable contemplation” of the parties when
Chapter 12) for refusing the employer’s request. Keays sued the contract was formed. According to the Supreme Court,
for wrongful dismissal, seeking compensatory damages for since the Wallace decision “there has been [an] expectation
failure to provide reasonable notice, as well as aggravated and by both parties … that employers will act in good faith in the
punitive damages. manner of dismissal. Failure to do so can lead to foreseeable,
Issue: Was Keays wrongfully dismissed? If yes, what were his compensable damages.”
damages? Therefore, an employee can recover aggravated dam-
ages for bad faith in the manner of dismissal if the court is
Decision: Yes, Keays was wrongfully dismissed. His refusal to persuaded that the harsh manner of dismissal, rather than
see the employer’s doctor was not cause for summary dis- the fact that the employee was dismissed, actually caused
missal. Given Keays’s history of being misdiagnosed in the the employee real physical or psychological harm. If so, the
past, he had a reasonable excuse to refuse a one-on-one courts must assign a dollar amount to that harm. In this
appointment with the employer’s doctor in the circum- case, the Supreme Court ruled that the employer had not
stances and, in any event, terminating Keays for expressing acted in bad faith in the manner of dismissal. There was
reservations about the medical referral was not proportional nothing malicious or unduly insensitive in the manner in
to any misconduct Keays may have engaged in. The Supreme which the employer requested independent medical evi-
Court of Canada accepted the trial judge’s conclusion that 15 dence. Therefore, Keays was not entitled to aggravated or
months was reasonable notice in his case. Therefore, Keays punitive damages.
There are now dozens of Canadian wrongful dismissal decisions in which courts have
ordered aggravated damages for bad faith in the manner of dismissal. The sorts of employer
behaviour that courts have found to constitute bad-faith discharge include the following:
• Being dishonest about the reason for dismissal.30

• Making unwarranted attacks on the employee’s job performance or honesty, such as by
falsely accusing the employee of misconduct.31
• Communicating the termination in an insensitive manner.32
• Handling the complaint in a procedurally unfair manner, such as by refusing the em-
ployee an opportunity to explain alleged wrongful acts.33
• Refusing to pay statutory benefits, to file documents necessary to permit the employee
to access government benefits, or to provide a reference letter.34
• Harassing the employee.35
• Threatening the employee with a large counter lawsuit if the employee dares to file a
wrongful dismissal lawsuit, or needlessly dragging out the litigation to impose further
costs on the employee.36

It is more difficult for an employee to obtain aggravated damages for bad-faith discharge
under the Honda approach than it was under the Wallace approach.37 Under Wallace, the em-
ployee was not required to prove that they suffered actual physical harm as a result of the man-
ner in which the dismissal took place. The employee had only to present evidence that the
employer acted in an unduly insensitive manner when it fired the employee, and if the judge
agreed, the judge would extend the notice period and therefore the amount of damages owed.38
Under the Honda approach, the employee must now present some evidence that establishes that
they suffered physical or psychological harm caused by the employer’s insensitive behaviour
rather than the fact of being dismissed.39 That causal connection is often difficult to establish.40
However, if the employee can persuade the court that they suffered serious psychological or
physical harm as a result of the manner of dismissal, the recoverable damages can be larger than
under the Wallace approach.41 That is because in the Honda approach, the court will not simply
extend the notice period by a month or two but instead compensate the employee for the actual
harm suffered. For example, if the employee cannot work due to depression caused by the
employer’s bad faith in the manner of dismissal, then the employer could be liable for lost wages
damages going far beyond the notice period under the former contract.42 In the 2019 decision
Colistro v. Tbaytel (see Box 13.1), the Ontario Court of Appeal awarded $100,000 in “Honda
aggravated damages” for mental suffering experienced by a female employee who was construct-
ively dismissed when the employer rehired a man who years earlier had sexually harassed her.
The court ruled that the employer had “placed its business interests above the expectations and
concerns of a valued, long-time employee” and downplayed the psychological trauma the hiring
caused the employee.43 In the decision summarized in Box 14.4, the same court ordered
$200,000 in aggravated damages for Walmart Canada’s behaviour leading to a constructive dis-
missal, along with an additional $100,000 in punitive damages.

Aggravated and Punitive Damages for Failing to Stop Managerial Harassment of an Employee
Boucher v. Wal-Mart Canada Corp. which a doctor attributed to stress. Walmart continued to pay
2014 ONCA 419 Boucher’s salary and benefits for eight months (even though her
contract entitled her to only 20 weeks’ notice of termination).
Key Facts: Boucher was an assistant manager. After she refused A jury awarded punitive damages against Pinnock in the
her manager’s order to falsify a temperature log, the manager amount of $150,000 as well as another $100,000 for commit-
(Pinnock) commenced a six-month campaign of verbal harass- ting the tort of intentional infliction of mental suffering.
ment and intimidation directed at Boucher. Boucher com- Walmart was vicariously liable for these damages (meaning
plained to upper management, which only increased the Walmart is required to pay the damages ordered against Pin-
intensity of Pinnock’s abuse. Pinnock routinely swore at Bouch- nock) because Pinnock was its employee at the time. (We will
er, called her stupid in front of colleagues, and attempted to discuss this tort and the concept of vicarious liability in Chap-
drive Boucher to quit. A human resources manager told Pinnock ter 16). The jury ordered $200,000 in aggravated damages
to back off on his treatment of Boucher, but Pinnock responded, against Walmart plus an additional $1,000,000 in punitive
“not until she [f-ing] quits.” Nevertheless, after an “investiga- damages. Both Pinnock and Walmart appealed those orders.
tion,” management told Boucher that her “complaints were
unsubstantiated,” and they warned her to stop undermining Issue: Did the jury make an error in awarding large aggravated
Pinnock. Boucher quit and sued for constructive dismissal. She and punitive damages against Pinnock (the manager) and
received medical treatment for abdominal pain and bloating, Walmart?
vicarious liability: A legal rule under which an employer is liable for damage caused to a third party by one or more of its
employees.

Decision: The court of appeal upheld the tort award against Not only did Walmart not ensure the harassment stopped, it
Pinnock but reduced the punitive damages award against him effectively took Pinnock’s side by threatening Boucher that
from $100,000 to $10,000. The court ruled that Pinnock’s be- complaints against Pinnock would lead to her discipline.
haviour was a “marked departure from the ordinary standards Walmart’s behaviour left Boucher with no choice but to quit,
of decent human behaviour” and therefore warranted a puni- and this constitutes bad faith in the manner of dismissal. The
tive damages order. However, when combined with the court of appeal reduced the punitive damages award from
$150,000 tort award, the jury’s punitive damages award was $1,000,000 to $100,000. It found that Walmart had committed
excessive to serve the function of punishment and deterrence. a separate legal wrong, as required to award punitive damages,
The court found that $10,000 punitive damages combined by breaching the “implied duty of good faith and fair dealing”
with $150,000 tort damages award was more than sufficient in employment contracts. However, the amount of $1 million
against an individual person. was unnecessarily high and not rationally connected to the
The court of appeal upheld the aggravated damages award objective of deterrence and denunciation given that Walmart
of $200,000 against Walmart. The court ruled that the con- was already liable to pay $200,000 in aggravated damages plus
structive dismissal occurred as a result of Walmart’s complete the $100,000 tort damages ordered against Pinnock, plus
failure to take Boucher’s complaints about Pinnock seriously. Boucher’s legal expenses in the trial.
C. Punitive Damages

The final type of damages potentially available in wrongful dismissal cases is known as punitive
damages. These damages are not intended to compensate the employee for actual harm suffered
(like compensatory and aggravated damages). Rather, they are intended to punish the employer
for its reprehensible conduct. The Supreme Court of Canada has described punitive damages
this way: “punitive damages are restricted to … wrongful acts that are so malicious and outra-
geous that they are deserving of punishment on their own.”44 The goals of punitive damages are
“denunciation, deterrence and retribution,” and they are only awarded when the court believes
that other damages will not satisfy those goals.45 To obtain punitive damages in a wrongful
dismissal lawsuit, the employee must point to an “independent actionable wrong,” such as a tort
or breach of a contract term other than the term requiring notice of termination.46 For this
reason, implied terms requiring “fair dealing” or decent treatment of employees play an espe-
cially important role in the assessment of punitive damages.
The very high legal threshold for ordering punitive damages means that they are ordered
relatively infrequently. However, in recent years, Canadian courts have been more willing to
order large punitive damage awards against employers who act in a manner that the courts be-
lieve is high-handed and insensitive to the employee. The Walmart case in Box 14.4 is one ex-
ample.47 In a second more recent case, Galea v. Wal-Mart Canada, Walmart was again ordered
to pay $200,000 in aggravated damages plus a whopping $500,000 in punitive damages! In that
case, Walmart demoted a vice-president to a lower-ranking executive job but refused to define
her new position or assign a clear role for 10 months before they eventually terminated her.
After the employee was terminated, Walmart failed to abide by the clear contract language
requiring payment of wages for two years and then used delay tactics to stall the litigation. The
lower court ruled that Walmart’s conduct violated the implied duty of good-faith dealing in a
high-handed manner.48 In the 2018 decision Bailey v. Service Corporation, a British Columbia
court ordered $110,000 in punitive damages against an employer that terminated a long-serv-
ing, 60-year-old employee when he was off work sick. The employee found out he had been
terminated when his wife was told by an insurance company. The employer then falsely main-
tained that the employee had been terminated for cause.49
punitive damages: Damages ordered against a party who engages in outrageous or egregious behaviour deserving of special
denunciation and retribution.

IV. The Duty to Mitigate Compensatory Damages

Finally, we need to consider the duty of employees to mitigate avoidable losses when they have
been dismissed. This task requires that we distinguish between two types of contractual prom-
ises dealing with termination found in employment contracts. The first is a promise by the em-
ployer to pay the employee a predetermined amount of money at the time of termination, such
as the following:
The employer shall provide the employee with three months’ notice of termination or pay in lieu of
notice.
This clause creates a binding obligation on the employer to either give the employee three
months’ working notice or pay the employee three months’ wages when it terminates the con-
tract. In either case, the employer has promised to pay the employee three months’ pay if and
when it terminates the contract.50 When a contract spells out a specific amount of notice or pay
in lieu of notice to which an employee is entitled as a condition of termination, the employee is
under no obligation to try and reduce their losses unless the contract includes an expressed term
requiring the employee to do so. So even if the employee immediately gets a new job, the previ-
ous employer still has to pay the full three months’ pay despite the fact that this means the em-
ployee receives somewhat of a windfall. This result applies as well in the case of a fixed-term
contract that is terminated early by the employer. The employee could sit on the couch and
watch The Simpsons reruns and still collect the pay required by the contract.51
The second type of clause does not define a specific amount of notice or pay in lieu of notice
that is required but instead requires the employer to provide the employee with reasonable
notice of termination. As we have seen, a failure of the employer to comply with the contractual
obligation to give reasonable notice “repudiates” the contract and entitles the employee to
recover damages for wrongful dismissal. A promise to give reasonable notice is not the same
thing as a promise to pay three months’ wages as a condition of termination. The importance
of the distinction rests in a rule of contract law that requires the innocent party to minimize
their losses. This rule is known as the duty to mitigate. It requires an employee dismissed
without reasonable notice to do their best to limit the damages incurred from not having
received reasonable notice. Consider the following example:
A court rules that Stephen’s contract required the employer to provide three months’ reasonable
notice of termination. The employer dismissed him with no notice. Stephen’s wages amounted to
$2,000 per month. After one month of unemployment, Stephen got a new job that paid him $1,500
per month. His damage award in the wrongful dismissal lawsuit would be calculated as follows:
Lost wages arising from wrongful dismissal (3 months’ pay at $2,000/mo.) $6,000
Deduct earnings from new employment (2 months’ pay at $1,500/mo.) $3,000
Total amount of damages employer must pay $3,000
The employer benefits from the employee’s successful mitigation efforts in this example.
Moreover, if Stephen had just sat on the couch watching television and had not searched for a
new job, the court could also deduct from the damages owing whatever amount the court thinks
Stephen would have earned had he made reasonable efforts to find a job. Therefore, in a lot of
wrongful dismissal lawsuits, the courts are asked to decide whether the employee has satisfied
the duty to mitigate.

A. The Standard of Mitigation Required

The burden is on the employer to persuade the court that the employee could have mitigated
their losses but failed to do so.52 That means demonstrating that the employee did not make
reasonable efforts to seek new employment and also that, if the employee had done so, they
probably would have gotten a new job.53 In practice, therefore, the duty to mitigate usually boils
down to two key obligations imposed on the dismissed employee:
1. To make reasonable efforts to look for a new job.

2. To accept a job offer that a reasonable person in their position would accept (including,
as we will see, a job offer from the very employer who has just fired the person!).
Employers will present evidence that job vacancies were available during the notice period
for which the employee was reasonably qualified (e.g., through ads posted on job boards or in
newspapers). Employees are usually given a brief period—one court said up to two to three
months—of recovery time immediately after dismissal during which time they are not expected
to be actively looking for work.54 Thereafter, employees are expected to take reasonable steps to
mitigate the damage resulting from the wrongful dismissal.
An employee is not required to accept any job that comes up. The legal test asks whether the
employee acted “reasonably” in their efforts to find new work, as described by the British Col-
umbia Court of Appeal:
The duty to “act reasonably” … must be a duty to take such steps as a reasonable person in the dis-
missed employee’s position would take in his own interests—to maintain his income and his position
in his industry, trade or profession. The question whether or not the employee has acted reasonably
must be judged in relation to his own position, and not in relation to that of the employer who has
wrongfully dismissed him. The former employer cannot have any right to expect that the former
employee will accept lower-paying alternate employment with doubtful prospects.55
It is difficult to describe concrete rules that apply to mitigation, since each case is decided on
its own unique facts. However, a perusal of the many cases considering mitigation allows for
some general statements. For example, in applying the “reasonableness” test, the courts have
ruled that employees can decline job opportunities that would amount to a substantial step
backward from their previous job, including much lower pay and status.56 Also, employees are
not required to apply for jobs they are clearly not qualified for57 or to accept a part-time job
rather than hold out for a full-time position.58 If job opportunities in the employee’s field are
scarce, then reasonable mitigation may include returning to school or taking new training pro-
grams.59 A dismissed employee may be required to accept a job in a different geographical loca-
tion if no local jobs are available; however, the extent to which an employee is required to uproot
and move depends on the employee’s age and personal circumstances.60
In one case, an employee was considered to have failed to mitigate when he declined a job
offer in the same field as his former job to pursue a new career as a self-employed real estate
agent, a decision the court believed was too “risky.” The court ruled that it is unreasonable, and
a failure of the duty to mitigate, for an employee to pursue self-employment rather than a new
job in their field, unless the evidence discloses that the employee would not have been able to
find a job in their traditional field.61 It is also unreasonable for an employee to hold out for a job
with a specific employer when reasonable opportunities are available with other employers in
their field.62
B. Mitigation with a Job Offered by the Former Employer

A controversial issue involves the duty of an employee to mitigate with a job offered by the same
employer who has just illegally fired them. The courts have long stated that the employment
relationship is defined by mutual trust and confidence, and for this reason (among others)

judges have declined to order specific performance of employment contracts, as noted earlier in
this chapter. Moreover, the courts have also recognized that employees are in a position of vul-
nerability. Therefore, we might think that an employee ought not to be required to accept a job
with the employer who has just illegally dismissed them, under threat of forfeiting entitlement
to damages arising from that termination. As the BC Court of Appeal once noted, it is “almost
amusing, and highly artificial” to expect that an employer will work nicely and respectfully with
an employee who is in the process of suing that employer for wrongful dismissal.63
Nevertheless, the Supreme Court of Canada ruled in the case of Evans v. Teamsters Local
Union No. 31 that the duty to mitigate requires an employee to accept a job offer from the former
employer if “a reasonable person in the employee’s position would have accepted the employer’s
offer.” The court wrote that a reasonable person would likely accept a job offer from the former
employer when the following conditions are met:
1. The salary offered is the same, the working conditions are not substantially different or
the work demeaning, and the personal relationships are not acrimonious.
2. Returning to the old workplace would not place the employee in an “atmosphere of
hostility, embarrassment or humiliation.”64
Since Evans, employers frequently offer dismissed employees job opportunities during the
notice period in an attempt to reduce the damages payable. Some employees who refuse those
offers have been found to have failed in their duty to mitigate (see Box 14.5). In the majority of
cases, though, courts have ruled that employees were not required to accept mitigation with
their former employer on the basis that the offered job was not substantially similar or that it
would be humiliating or unreasonable to expect the employee to return to their old workplace.65
However, when the circumstances of the termination were not hostile or contentious, and the
terminated employee is offered a job of similar status and pay, courts have found that the em-
ployee was required to accept the offer of mitigation with the former employer.66

Meet the New Boss, Same as the Old Boss
Chevalier v. Active Tire & Auto Centre Inc. Issue: Did Chevalier fail to mitigate when he refused the em-
2013 ONCA 548 ployer’s offer to re-employ him in his former position?
Key Facts: Chevalier was 55 years old and had 33 years’ service Decision: Yes. Applying the Supreme Court’s reasoning in
with Active Tire & Auto Centre Inc., including 18 years as a Evans v. Teamsters Local Union No. 31, the court ruled that the
manager, when a temporary layoff led to his constructive employer’s job offer was at the same rate of pay and in the
dismissal. Chevalier filed his lawsuit a couple of weeks into the identical position, and that returning to this job would not
layoff. A few days after that lawsuit was filed, the employer have caused Chevalier embarrassment or humiliation. The
offered Chevalier the opportunity to return to his old job. employer had not treated Chevalier in a demeaning manner
Chevalier refused the offer because he felt harassed and dis- during the ordeal. A “reasonable person” in Chevalier’s position
respected by the employer. At the trial, the court assessed the would have accepted the job offer. Therefore, the employer
period of reasonable notice at 24 months. However, the em- had met the burden of proving that Chevalier failed in his duty
ployer argued that Chevalier had failed to mitigate his losses to mitigate his damages. No damages were ordered, even
when he declined the employer’s offer to return to work. though the employer had wrongfully dismissed Chevalier.
The Evans approach requiring employees to sometimes mitigate in a job with the employer
who just fired them has been criticized because it allows an employer to avoid the consequences
of its wrongful actions by simply offering the dismissed employee another job. Justice Abella of
the Supreme Court noted in her dissenting judgment in Evans that the requirement to mitigate

in the job from which you have just been wrongfully dismissed permits the employer “to uni-
laterally transform their unlawful treatment” of the employee “into a lawful dismissal” in which
the employee is entitled to no notice.67
Let’s conclude this chapter with a fun decision that ties together several legal issues we have
considered so far in our review of the common law regime, including modifications to employ-
ment contracts (Chapter 7), constructive dismissal (Chapter 13), and the duty to mitigate. Recall
from those earlier chapters that an employer seeking to reduce an employee’s pay cannot just
unilaterally impose the change over the employee’s objection. In the decision outlined in Box
14.6, the employee expressly objected to a pay cut but kept working anyway, receiving the lower
wages imposed by the employer. Pay attention to the argument the employee makes, relying on
the Evans v. Teamsters decision.

Is it Condonation or Mitigation?
Russo v. Kerr Issue: Did Russo condone the pay cut and thereby surrender
2010 ONSC 6053 his right to claim constructive dismissal, or was Russo mitigating
his losses by continuing to work in his old job with reduced pay?
Key Facts: Russo had worked for Kerr for 37 years. A new
president hired in 2009 decided that significant cost reduc- Decision: Russo was constructively dismissed when the em-
tions were necessary to keep the company economically viable ployer cut his pay substantially. Russo clearly informed the
and that Russo was earning far more than market forces dic- employer that he was not accepting or condoning the pay cut
tated. He informed Russo that he would be cutting his base and that it was his position that the pay cut amounted to a con-
pay and bonus by nearly 50 percent. Russo hired a lawyer who structive dismissal. Therefore, there was no condonation of the
informed the employer that Russo did not agree to the pay cut pay cut. Russo could have argued that the pay cut was a breach
and that the cut amounted to grounds for constructive dis- of contract and sued for the difference in pay while keeping
missal. Afterwards, Russo continued to work for Kerr, receiving the contract alive. But instead, he opted to argue that the pay
the reduced pay, and then sued to recover the difference be- cut was a constructive dismissal and that by continuing to work,
tween his old pay and the new reduced pay. The employer he was simply mitigating his losses as per the Supreme Court’s
argued that by continuing to work with the reduced pay, Russo direction in the Evans v. Teamsters’ decision. The court ruled
had “condoned” the pay cut (see Chapter 13). Russo argued that Russo was entitled to take that position. The court ruled that
that when he continued to work after the pay cut, he was 22 months was reasonable notice in this case. Damages were
simply mitigating his damages that resulted from the con- ordered based on that period of time calculated on the basis of
structive dismissal that had occurred when his pay was cut by the difference in pay between what Russo would have earned
nearly 50 percent. before the pay cut and what he actually earned working for Kerr
during the period of notice.
V. Chapter Summary

The goal of damages in wrongful dismissal lawsuits is to place the employee back into the pos-
ition they would have been in had the employee worked through the proper notice period. This
goal is achieved by ordering monetary damages. Aggravated damages are sometimes available
for mental suffering experienced by a dismissed employee as a result of bad faith in the manner
in which they are dismissed. Punitive damages are only ordered when an employer engages in
particularly reprehensible behaviour that the court believes is deserving of additional punish-
ment. In the common law regime, courts do not order the reinstatement of employees to their
former jobs. This approach stands in sharp contrast to that of the other two regimes of work law:
the regulatory standards regime and the collective bargaining regime. If an employer dismisses
an employee in contravention of a requirement to give reasonable notice, the employee must
make efforts to mitigate damages by seeking new employment and maybe even by accepting
re-employment in a job offered by the former employer.


1. What are “compensatory damages” in a wrongful dismissal action, and how do judges
determine their amount?
2. What is the difference between compensatory and aggravated damages? Explain the cir-
cumstances under which a court might order aggravated damages in a wrongful dismissal
lawsuit and provide some examples.
3. Explain the difference between the Supreme Court’s approaches to “bad-faith discharge”
in the Wallace and Honda decisions.
4. What is “specific performance”? Do courts apply it in breaches of employment contracts?
5. What are the conditions in which an employee will be expected to accept a job with the
employer that has just dismissed them as part of an employee’s duty to mitigate?
APPLYING THE LAW

1. Eileen is terminated after 10 years’ service. Her employ- mination and the employer fabricated the false
ment contract included a clause that requires the em- allegation about theft. The employer’s false allegations
ployer to provide Eileen with three months’ notice or of dishonesty caused Eileen to suffer severe depression
pay in lieu of notice in the event she is terminated that required her to take medication.
without cause. Her pay is $3,000 per month, plus $200 a. Discuss what damages you believe a court would
per month contributed to a pension plan by the em- order in these circumstances. If you believe a court
ployer, plus a $2,000 bonus paid out to every em- might order aggravated or punitive damages, ex-
ployee who has been employed for a least one year plain the tests courts apply when considering those
and who is employed on December 31. Eileen is ter- damages. (You are not expected to know the pre-
minated on November 1. The employer falsely alleged cise amount a court would order in aggravated or
cause and told Eileen’s co-workers that Eileen had punitive damages, as these are decided on a case-
been fired for stealing money, when in fact there was by-case basis.)
no evidence of this. The employer maintained its pos- b. Assume now that the employer argues that Eileen
ition that Eileen had stolen money right up to the be- failed to mitigate her losses because she did not
ginning of the trial, at which point it dropped that actively look for work during the period of notice.
position and admitted that there was no cause. As- What argument(s) would you make on Eileen’s be-
sume that the court rules there was no cause for ter- half in response to that argument?
EXERCISE
Every decision in a successful wrongful dismissal lawsuit will include a discussion and assess-
ment of the damages that the employer must pay to the employee. Many will also include a
discussion of whether the employee has properly mitigated their losses. This exercise encourages
you to find and read some of these decisions and consider how the principles discussed in this
chapter were applied to the facts of those cases.
To learn how the courts have dealt with wrongful dismissal and the duty to mitigate, search
for cases that reference the Evans v. Teamsters case. In this exercise, we “note up” the Evans v.
Teamsters case.

2. In the “Noteup” search box, type “Evans v. Teamsters Local Union No. 31” and choose
“Evans v. Teamsters Local Union No. 31, 2008 SCC 20” from the drop-down list that
appears. That search should give you over 100 cases that cite the Evans decision.

3. Select two cases that involve wrongful dismissal actions in which the matter of the employ-
ee’s mitigation efforts was considered and read them. Answer the following questions for
each case:
a. Were compensatory damages ordered? If so, what was the amount ordered?
b. Were either aggravated or punitive damages ordered? If so, describe the employer’s
behaviour that led the court to order such damages.
c. Did the court find that the employee failed to mitigate damages? If so, by how much
was the damages award reduced?

1. The employee cannot elect to keep the contract alive, as is Will” (1984) 51 U Chicago L Rev 947 (reinstatement should
the case with other types of contract breach by the em- not be permitted, and there should be no requirement to
ployer. See Canadian Ice Machine v. Sinclair, [1955] SCR give notice of termination).
777 at 4; and Gunton v. Richmond-upon-Thames London 8. Nygard International Ltd. v. Robinson, supra note 3 at 106;
Borough Council, [1982] Ch. 448. Michaels v. Red Deer College (1974), 44 DLR (3d) 447 (Alta.
2. See the discussion of these basic principles of wrongful dis- SC (AD)); Roe, McNeill & Co. v. McNeill, 1998 CanLII 6230
missal law in Merrill Lynch Canada Inc. v. Soost, 2010 (BCCA); Davidson v. Allelix Inc., 1991 CanLII 7091 (Ont.
ABCA 251; Taggart v. Kwikasair Express Ltd., 1980 CanLII CA); Sylvester v. British Columbia, [1997] 2 SCR 315; and
382 (BCCA) at 353; and Vorvis v. Insurance Corporation of Paquette v. TeraGo Networks Inc., 2016 ONCA 618.
British Columbia, [1989] 1 SCR 1085. 9. Johnson v. Global Television Network Inc. (CH Vancouver
3. Fidler v. Sun Life Assurance Co. of Canada, 2006 SCC 30. Island), 2008 BCCA 33 at para 23. See also Wallace v.
See also Nygard International Ltd. v. Robinson, 1990 CanLII United Grain Growers Ltd., [1997] 3 SCR 701 at para 61;
1991 (BCCA) at 106; Robinson v. Harman, [1848] 154 ER and Sylvester v. British Columbia, supra note 8. The assump-
363; and Wertheim v. Chicoutimi Pulp Co., [1911] AC 301. tion is that the employee would have worked during the
4. An example is the British decision Hill v. C.A. Parsons and notice period. An employee who would have remained in
Co. Ltd., [1972] Ch. 305. A key factor in cases where rein- receipt of disability benefits throughout the notice period
statement has been ordered is the absence of animosity will have those benefits deducted from damages for lost
between the parties and continued mutual trust and confi- wages if the employer pays both the wages and the benefits
dence that survived the act of terminating the contract. directly. However, if the insurance benefits are paid by a
third-party insurer, then the disability benefits are not
5. International Brotherhood of Electrical Workers, Local
deductible from the wages award: McNamara v. Alexander
Union 2085 et al. v. Winnipeg Builders’ Exchange et al.,
Centre Industries Ltd., 2001 CanLII 3871 (Ont. CA); and
[1967] SCR 628.
Sills v. Children’s Aid Society of the City of Belleville, 2001
6. Philp v. Expo 86 Corp., 1987 CanLII 2476 (BCCA) at para CanLII 8524 (Ont. CA).
45. See also DeFrancesco v. Barnum, [1890] 45 Ch. D 430 at
10. Hadley v. Baxendale, [1854] 156 ER 145 at 151, applied by
438. The traditional justifications for the refusal of common
the Supreme Court of Canada in Honda Canada Inc. v.
law courts to order specific performance include the diffi-
Keays, 2008 SCC 39 at paras 54-56.
culty courts would have supervising a reinstatement order
of a non-union employee and that there should be “mutual- 11. Note that the test for remoteness and reasonable contem-
ity” in contract remedies, and since a mandatory order for plation in Hadley v. Baxendale also applies to a contractual
an employee to return to work would amount to a form of breach by an employee that causes an employer to suffer
slavery, the courts should not order employers to take back monetary loss. For a good discussion of this scenario, see
employees against their will. See the discussion in S. Hon- RBC Dominion Securities Inc. v. Merrill Lynch Canada Inc.,
eyball, Employment Law, 12th ed (Oxford: Oxford Univer- 2008 SCC 54 at para 12.
sity Press, 2012) at 84. 12. See Garcia v. 1162540 Ontario Inc., 2013 ONSC 6574 (the
7. Whether the common law should revisit its opposition to employee called no evidence to establish he suffered a loss
reinstatement as a remedy for breach of the employment as a result of the termination and therefore no damages
contract is a hotly debated question. See, for example, D. were ordered). See also Red Deer College v. Michaels, [1976]
Brodie, “Specific Performance and Employment Contracts” 2 SCR 324 at para 11.
(1998) 27 Indus LJ 37 (specific performance should be 13. See, for example, Rieta v. North American Air Travel Insur-
allowed); and R. Epstein, “In Defense of the Contract at ance Agents Ltd., 1998 CanLII 6540 (BCCA) (evidence

established that overtime pay would have been earned bonus during the notice period). Where a payment is
during the notice period); Alishah v. 1582557 Ontario Ltd., within the employer’s discretion, it will not be recoverable
2007 CanLII 243 (Ont. Sup Ct J); Lewis v. Lehigh Northwest in damages because the courts assume that employers exer-
Cement Limited, 2009 BCCA 424 (even though the em- cise their discretion in a manner that maximizes their own
ployee had received annual raises in the past, evidence was financial interests. However, the employer’s discretion to
unclear that he would have received a raise during the deny a bonus to a dismissed employee must not be exer-
notice period); Olivares v. Canac Kitchens, 2012 ONSC 284; cised in bad faith or unreasonably: Burns v. Oxford De-
and Kwasnycia v. Goldcorp Inc., 1995 CanLII 7276 (Ont. velopment Group Inc. (1992), 128 AR 345 (QB); and Lippa v.
Gen Div) (lost overtime was payable). Can-Cell Industries Inc., 2009 ABQB 684.
14. Lewis v. Lehigh Northwest Cement Limited, supra note 13; 21. See, for example, Devlin v. NEMI Northern Energy &
and Durrant v. British Columbia (Hydro and Power Au- Mining Inc., 2010 BCSC 1822 (the contract made payment
thority), 1990 CanLII 271 (BCCA). See also Potter v. New of bonus mandatory); Hobbs v. TDI Canada Ltd., 2004
Brunswick Legal Aid Services Commission, 2015 SCC 10 CanLII 44783 (Ont. CA) (the contract required payment of
(pension payments made to employee were not to be commissions); Prozak et al. v. Bell Telephone Co. of Canada,
deducted from wrongful dismissal damages). 1984 CanLII 2065 (Ont. CA); Noble v. Principal Consultants
15. Stauder v. BC Hydro & Power Authority, 1988 CanLII 3037 Ltd. (Bankrupt), 2000 ABCA 133; Hyland v. Advertising
(BCCA) (assessing the value of loss of vacation time at Directory Solutions Inc., 2014 ABQB 336; and Paquette v.
$2,500); Kwasnycia v. Goldcorp Inc., supra note 13 (the TeraGo Networks Inc., supra note 8.
value of lost paid vacation was estimated at 10 percent of 22. Machtinger v. HOJ Industries Ltd., [1992] 1 SCR 986; and
income); Dussault v. Imperial Oil Limited, 2019 ONCA 448; Reference Re Public Service Employee Relations Act (Alta.),
and Paquette v. TeraGo Networks Inc., supra note 8. [1987] 1 SCR 313 at 368.
16. Baumgart v. Convergent Technologies Canada (1989), 28 23. The leading cases on this point are Peso Silver Mines Ltd. v.
CCEL 250 (BCSC); McDonald v. GBC Canada Inc., 2004 Cropper, [1966] SCR 673; Vorvis v. Insurance Corporation of
BCSC 1029; and Wood v. BBC Brown Boveri Canada Inc., British Columbia, supra note 2; and Addis v. Gramophone
1986 CanLII 1215 (BCCA). Co., [1909] AC 488 (HL). For criticisms of the courts’ his-
17. Mothersele v. Gulf Canada Resources Ltd., 2003 ABQB 2; torical approach to damages for mental suffering arising
Veer v. Dover Corp. (Canada) Ltd., 1997 CanLII 12429 from breach of the employment contract, see J. Swan,
(Ont. Gen Div); Kieran v. Ingram Micro Inc., 2004 CanLII “Extended Damages and Vorvis v. Insurance Corporation of
4852 (Ont. CA); and Saalfeld v. Absolute Software Corpora- British Columbia” (1990) 16 Can Bus LJ 213; R.B. Schai,
tion, 2009 BCCA 18. “Aggravated Damages and the Employment Contract”
(1991) 55 Sask L Rev 345; and D. Doorey, “Employer Bully-
18. Alcatel Canada Inc. v. Egan, 2006 CanLII 108 (Ont. CA). ing: Implied Duties of Fair Dealing in Canadian Employ-
19. It is more complicated if the employer terminated benefits ment Contracts” (2005) 30 Queen’s LJ 500. Justice Binnie of
coverage during the notice period and the employee does the Supreme Court explained that “aggravated damages”
not actually incur any financial costs as a result. In British are intended to compensate the victim for “the additional
Columbia, the courts have ruled that an employee can harm caused to the plaintiff ’s feelings by reprehensible or
recover money for a loss of benefits coverage during the outrageous conduct on the part of the defendant”: Whiten
notice period only if they can demonstrate an actual finan- v. Pilot Insurance Co., 2002 SCC 18 at para 116.
cial loss resulting from the absence of the coverage, such as 24. Wallace v. United Grain Growers Ltd., supra note 9 at
the purchase of replacement insurance coverage: Sorel v. para 102.
Tomenson Saunders Whitehead Ltd., 1987 CanLII 154
25. Ibid. at para 95.
(BCCA); and Matheson v. Canadian Freightways Ltd., 2003
BCSC 1728. In other provinces, including Ontario, Alberta, 26. The Wallace decision has been examined exhaustively by
and Manitoba, the courts have ruled that an employee can academics and practitioners. Some examples include
be reimbursed the amount the employer would have paid Doorey, supra note 23; L. Stuesser, “Wrongful Dismissal—
for the benefits for the duration of the notice period, Playing Hardball: Wallace v. United Grain Growers” (1997-
regardless of whether the employee had purchased new 98) 25 Man L Rev 547; J. Fudge, “Limits of Good Faith in
insurance or incurred actual financial loss due to the the Contract of Employment: From Addis to Vorvis to
absence of insurance: Davidson v. Allelix Inc., 1991 CanLII Wallace and Back Again” (2007) 32 Queen’s LJ 529.
7091 (Ont. CA); Kapitany v. Thomson Canada Ltd., 2001 27. B. Curran, “Honda v. Keays: Employer Shield or Employee
MBCA 167; and Christianson v. North Hill News Inc., 1993 Sword? An Empirical Analysis” (unpublished manuscript,
ABCA 232. 2013).
20. See, for example, Alguire v. Cash Canada Group Ltd., 2007 28. See the observations of Justice Echlin in Yanez v. Canac
ABCA 351 (the employee would not have qualified for the Kitchens, 2004 CanLII 48176 7 (Ont. Sup Ct J), which

decried the routine pleading of “specious ‘Wallace claims’” 38. See the discussion in Veel, supra note 29 at 149.
by employees. 39. The employee is not required to present medical or expert
29. See the discussion in P. Veel, “Clarity and Confusion in evidence to demonstrate harm, but there must be some evi-
Employment Law Remedies: A Comment on Honda dentiary basis to demonstrate a link between the employer’s
Canada Inc. v. Keays” (2009) 67 UT Fac L Rev 135. bad faith in the manner of discharge and harm suffered:
30. Capital Pontiac Buick Cadillac GMC Ltd. v. Coppola, 2013 Lau v. Royal Bank of Canada, 2017 BCCA 253; and
SKCA 80; Hughes v. Gemini Food Corp., 1997 CanLII 1267 Cottrill v. Utopia Day Spas and Salons Ltd., 2018 BCCA 383.
(Ont. CA); Noseworthy v. Riverside Pontiac-Buick Ltd., 1998 See also discussion in Saadati v. Moorhead, 2017 SCC 28;
CanLII 2751 (Ont. CA); and Wallace v. United Grain and Galea v. Wal-Mart Canada Corp., supra note 35.
Growers Ltd., supra note 9. 40. See, for example, Fox v. Silver Sage Housing Corporation,
31. Price v. 481530 B.C. Ltd., 2016 BCSC 1940; Davies v. 2008 SKQB 321 (the employer’s behaviour met the standard
Canada Shineray Suppliers Group Inc., 2017 BCSC 304; of bad-faith dismissal, but the employee failed to prove that
Valle Torres v. Vancouver Native Health Society, 2019 BCSC he suffered damages as a result of the conduct). Other cases
523; Pate Estate v. Galway-Cavendish and Harvey (Town- where the employee failed to demonstrate damage include
ship), 2013 ONCA 669; Pagliaroli v. Rite-Pak Produce Co. Beggs v. Westport Foods Ltd., 2011 BCCA 76; Kelly v. Norse-
Limited, 2010 ONSC 3729; Antonacci v. Great Atlantic & mont Mining Inc., 2013 BCSC 147; Brien v. Niagara Motors
Pacific Company of Canada, 2000 CanLII 5496 (Ont. CA); Limited, 2009 ONCA 887; Chan v. Dencan Restaurants Inc.,
and Geluch v. Rosedale Golf Assn., 2004 CanLII 14566 (Ont. 2011 BCSC 1439; and Elgert v. Home Hardware Stores
Sup Ct J). Limited, 2011 ABCA 112.
32. Simmons v. Webb, 2008 CanLII 67908 (Ont. Sup Ct J) 41. Curran, supra note 27 at 24 (“employees who can prove
(handing a 20-year employee a termination letter with no high levels of psychological distress will enjoy higher
explanation and telling him to leave the property immedi- returns … in terms of moral damages”).
ately); Chapell v. Canadian Pacific Railway Company, 2010 42. See, for example, Bru v. AGM Enterprises Inc., 2008 BCSC
ABQB 441 (the employer engaged in a case-building exer- 1680 (a low-wage employee who was entitled to just three
cise to get rid of the employee); Rae v. Attrell Hyundai months’ reasonable notice was awarded an additional
Suburu, 2005 CanLII 42475 (Ont. CA) (a termination letter $17,000 for bad-faith discharge, roughly equivalent to ten
was sent two weeks before the employee was to give birth); months’ pay).
Kaiser v. Dural, 2003 NSCA 122 (dismissing an employee 43. Colistro v. Tbaytel, supra note 35.
who recently recovered from illness in a restaurant without
any care for the employee’s circumstances); and Vernon v. 44. Honda Canada Inc. v. Keays, supra note 10 at para 62;
British Columbia (Liquor Distribution Branch), 2012 BCSC Whiten v. Pilot Insurance Co., supra note 23; Pate Estate v.
133 (employee’s wife learned of the termination when an Galway-Cavendish and Harvey (Township), supra note 31;
insurance company told her). and Elgert v. Home Hardware Stores Limited, supra note 40.
33. Baughn v. Offierski, 2001 CanLII 28291 (Ont. Sup Ct J); 45. Whiten v. Pilot Insurance Co., supra note 23 at para 94.
Middleton v. Highlands East (Municipality), 2013 ONSC 46. In Honda Canada Inc. v. Keays, supra note 10, the court
763. ruled that the independent actionable wrong cannot be an
34. Strudwick v. Applied Consumer & Clinical Evaluations Inc., alleged violation of human rights legislation, such as dis-
2016 ONCA 520; Marshall v. Watson Wyatt & Co., 2002 crimination on the basis of disability, because Seneca
CanLII 13354 (Ont. CA); and McCulloch v. Iplatform Inc., College v. Bhadauria, [1981] 2 SCR 181 (which we consid-
2004 CanLII 48175 (Ont. Sup Ct J). ered in Chapter 6) foreclosed that option. In any event, the
court did not believe that Keays had been discriminated
35. Prinzo v. Baycrest Centre for Geriatric Care, 2002 CanLII against. Therefore, Keays’s claim for punitive damages
45005 (Ont. CA); Doyle v. Zochem Inc., 2017 ONCA 130; failed.
Strudwick v. Applied Consumer & Clinical Evaluations Inc.,
supra note 34; Colistro v. Tbaytel, 2019 ONCA 197 (rehiring 47. Boucher v. Wal-Mart Canada Corp., supra note 35. See also
an employee who formerly harassed a current employer); Kelly v. Norsemont Mining Inc., supra note 40 ($100,000 in
Boucher v. Wal-Mart Canada Corp., 2014 ONCA 419; and punitive damages for breach of implied obligation of “good
Galea v. Wal-Mart Canada Corp., 2017 ONSC 245. faith and fair dealing” was owed by the employer to the em-
ployee); Nishina v. Azuma Foods (Canada) Co., Ltd., 2010
36. Galea v. Wal-Mart Canada Corp., supra note 35. BCSC 502. See also the discussion in D. Doorey, “Boucher
37. See Curran, supra note 27 at 23, finding that bad-faith dis- v. Walmart: Court of Appeal Confirms an Implied Obliga-
charge damages are “about 10 percentage points less prob- tion of Good Faith and Fair Dealing in Employment Con-
able” in the post-Honda era compared with during the tracts,” online, Law of Work (blog): <http://lawofwork
Wallace era. .ca/?p=7487>.

48. Galea v. Wal-Mart Canada Corp., supra note 35. unqualified is an amateur approach which we cannot say
49. Bailey v. Service Corporation International (Canada) ULC, that the reasonable person would follow, or that a plaintiff
2018 BCSC 235. See also Vernon v. British Columbia must follow to mitigate.”
(Liquor Distribution Branch), supra note 32 ($50,000 puni- 58. Christianson v. North Hill News Inc., supra note 19 at para
tive damages awarded when employer refused to provide a 15.
reference letter unless the employee quit rather than be 59. Ibid. (the employee did not fail to mitigate when she took a
terminated). six-month training program).
50. The courts call contract terms that promise the payment of 60. Ariss v. NORR Limited Architects & Engineers, 2019 ONCA
a predetermined amount “liquidated damages” or “contrac- 449 (an employee in his 60s is entitled to limit mitigation
tual amounts.” These amounts are payable and not subject efforts to the Kingston area where he lived); Maasland v.
to the duty to mitigate. See Bowes v. Goss Power Products Toronto (City), 2016 ONCA 551 (no duty to accept a job 50
Ltd., 2012 ONCA 425 (Ontario Court of Appeal ruled that kilometres from home); and Peet v. Babcock & Wilcox
a contract that specified the right of the employer to ter- Industries Ltd., 2001 CanLII 24077 (Ont. CA). If mitigation
minate the employment contract with “six months’ notice results in the employee moving, the costs of the move may
or pay in lieu” was a promise to pay a fixed amount and be added to the wrongful dismissal damages: Carbone v.
therefore that amount was not subject to a duty to mitigate. Syncrude Canada Ltd., 1997 CanLII 14863 (Alta. QB). See
Note that a contract requiring liquidated damages could the discussion, including the summary of contrasting opin-
also include a separate requirement for the employee to ions on the recoverability of moving expenses, in Porta v.
seek new employment and to mitigate their loss. However, Weyerhaeuser Canada Ltd., 2001 BCSC 1480 at paras
there is no implied duty to mitigate in the case of liquidated 153-65.
damages.) 61. Hart v. EM Plastic & Electric Products Ltd., 2008 BCSC 228.
51. See ibid.; Howard v. Benson Group Inc. (The Benson Group See similarly Hyland v. Advertising Directory Solutions Inc.,
Inc.), 2016 ONCA 256 (not duty to mitigate damages when supra note 21 (the employee’s decision to pursue a career as
employer terminates a fixed-contract early). See also a securities trader was not considered reasonable mitiga-
Maxwell v. British Columbia, 2014 BCCA 339; Covenoho v. tion). Cases in which the pursuit of self-employment was
Pendylum Ltd., 2017 ONCA 284; Philp v. Expo 86 Corp., found to be reasonable mitigation include Peet v. Babcock &
supra note 6; Duxbury v. Crook, 2018 SKQB 353; Halischuk Wilcox Industries Ltd., supra note 60; and Beglaw v. Arch-
v. Color Ad Packaging Ltd., 2015 MBQB 4; Brown v. Prong- metal Industries Corp., 2004 BCSC 1369.
horn Controls Ltd., 2011 ABCA 328; Freudenberg Household 62. Coutts v. Brian Jessel Autosports Inc., 2005 BCCA 224 (the
Products Inc. v. DiGiammarino, 2012 ONSC 5725; and Allen employee failed to mitigate when he held out for a job
v. Ainsworth Lumber Co. Ltd., 2013 BCCA 271. selling Ferraris, when opportunities with other luxury car
52. Red Deer College v. Michaels, supra note 12 at 331. dealers existed).
53. Evans v. Teamsters Local Union No. 31, 2008 SCC 20 at para 63. Cox v. Robertson, 1999 BCCA 640 at para 16.
30; and Robinson v. Team Cooperheat—MQS Canada Inc., 64. Evans v. Teamsters Local Union No. 31, supra note 53 at
2008 ABQB 409 at para 122. para 30 (the employee failed to mitigate when he refused
54. Robinson v. Team Cooperheat—MQS Canada Inc., supra to continue to work for the employer during the notice
note 53 at para 120. See also Chand v. Craftsman Collision period even though he had earlier proposed doing exactly
Ltd., 2007 BCPC 11; and Christianson v. North Hill News that; continuing in his job as a form of mitigation would
Inc., supra note 19. not have caused the employee humiliation or embarrass-
ment, and the workplace was not hostile). See also
55. Forshaw v. Aluminex Extrusions Ltd., 1989 CanLII 234 Mifsud v. MacMillan Bathurst Inc., 1989 CanLII 260
(BCCA); and Dussault v. Imperial Oil Limited, supra note (Ont. CA).
15.
65. Cases in which the employee was not required to mitigate
56. Fillmore v. Hercules SLR Inc., 2017 ONCA 280; Rienzo v. in a job offered by the former employer include Brake v.
Washington Mills Electro Minerals Corporation, 2005 PJ-M2R Restaurant Inc., 2017 ONCA 402; Chandran v.
CanLII 44668 (Ont. CA); Fleet v. EPC Industries Ltd., 2004 National Bank of Canada, 2012 ONCA 205; Patrick Bannon
NBQB 433; Schamborzki v. North Shore Health Region, 2000 v. Schaeffler Canada Inc./FAG Aerospace Inc., 2013 ONSC
BCSC 1573; Carter v. 1657593 Ontario Inc. (The Olde Angel 603; Turner v. Inndirect Enterprises Inc., 2011 ONCA 97;
Inn), 2015 ONCA 823; and Dussault v. Imperial Oil Limited, Farwell v. Citair, Inc. (General Coach Canada), 2014 ONCA
supra note 15. 177; Colwell v. Cornerstone Properties Inc., 2008 CanLII
57. Christianson v. North Hill News Inc., supra note 19 at para 66139 (Ont. Sup Ct J); Sifton v. Wheaton Pontiac Buick
16: “[t]o apply for jobs for which one is on their face GMC (Nanaimo) Ltd., 2010 BCCA 541; Magnan v. Brandt

Tractor Ltd., 2008 ABCA 345; Stewart v. Keary Coyle Motors 67. Evans v. Teamsters Local Union No. 31, supra note 53 at para
Ltd., 2011 NBQB 297; Renard v. Facet Decision Systems Inc., 92. The requirement to mitigate in a job with the former
2010 BCSC 1908; and Piron v. Dominion Masonry Ltd., employer also creates some conceptual challenges for con-
2013 BCCA 184. tract law, which I have discussed in a couple of longer posts
66. Cases in which the employee was required to mitigate in a on the Law of Work blog. See D. Doorey, “Chevalier v.
job offered by the former employer include Silva v. Leippi, Active Tire: The Mystery of Mitigating in the Job from
2011 BCCA 495; Davies v. Fraser Collection Services Which You’ve Just Been Fired,” online, Law of Work (blog):
Limited, 2008 BCSC 942; Besse v. Dr. A.S. Machner Inc., <http://lawofwork.ca/?p=7001>; and D. Doorey, “Silva v.
2009 BCSC 1316; Ghanny v. 498326 Ontario Limited, 2012 Leippi: Is Employment Law Losing Touch with Common
ONSC 3276; and Fredrickson v. Newtech Dental Laboratory Sense?” online, Law of Work (blog): <http://lawofwork
Inc., 2014 BCSC 335. .ca/?p=4347>.


C H A P T E R 15
“I Quit!”: Termination of the

Employment Contract by the
Employee
II. The Test for Assessing Whether an Employee Has Resigned 238
• Describe the test used to assess whether a resignation has
III. The Requirement for an Employee to Give an Employer
occurred. Notice of Termination 239
• Explain how the courts assess the “reasonable notice” employees IV. Calculating Damages When an Employee Fails to Give Proper Notice of
are required to provide employers when they resign. Termination 242
• Explain how damages are calculated if an employee resigns V. Chapter Summary 243
without giving proper notice. Questions and Issues for Discussion 243
I. Introduction
After arguing with a passenger and getting hit in the head with a piece of luggage, JetBlue flight
attendant Steve Slater grabbed the plane’s microphone, cursed at the passenger, grabbed a beer,
announced “it’s been great,” opened the plane’s emergency exit, and slid down the emergency
chute to unemployment.1 Now that is a quit!
Slater had had enough, and he left little doubt that he was resigning his employment. He did
not return to work (in fact, he faced criminal charges). However, as we will learn in this chapter,
it is not always clear whether an employee really intends to quit. Even if an employee yells
“I QUIT!” and storms out of the workplace, a judge might rule that a resignation has not
occurred. The courts demand clear evidence of an intention to resign and allow employees the
occasional temper tantrum.
When an employee does wish to resign, they usually must provide the employer with notice of
termination. An employee who resigns without providing the employer with the notice required
by the contract may be sued by the employer for wrongful quitting. How much notice is
required may be specified in the expressed terms of the contract or, in some provinces, in
employment standards legislation (see discussion in Chapter 20), or the courts may imply the
standard term requiring “reasonable notice” that we learned about in Chapter 9. The manner in
resignation: When an employee terminates the employment contract by engaging in conduct that evinces a clear intention
to terminate the contract.
wrongful quitting: A term sometimes used to describe a lawsuit filed by an employer alleging that an employee resigned
without providing the employer with the proper amount of notice of resignation.
237

which the courts assess the reasonable notice required of an employee is different than that
required of an employer because the purpose of the notice is different. This chapter explores
various legal issues that arise when employees terminate the employment contract.
II. The Test for Assessing Whether an Employee Has Resigned

How do we know a resignation when we see one? Slater’s flamboyant exit via the plane’s emer-
gency chute sure looked like a resignation. But most employees are not so dramatic, and the
circumstances are not always so straightforward. Imagine that an employer says to its employee,
“Jen, you should quit, and if you don’t, I’m going to fire you.” For many reasons, Jen might prefer
to quit rather than be fired, so she says, “Fine, I quit.”2 The benefit to the employer of an em-
ployee quitting rather than being fired is obvious: the employer is relieved of the obligation to
give notice of termination and the potential costs associated with that notice. However, the news
gets worse for the employee. In addition to losing her job and entitlement to notice of termina-
tion, if Jen quits she may lose her entitlement to other statutory benefits, such as severance pay-
ments under employment standards legislation and employment insurance benefits (see the
online chapter, “Regulating Unemployment” referenced on p. xxi in the preface of this book). It
matters significantly in our legal model whether the employer or employee terminates an
employment contract.
To shield employees from forfeiting the contractual and statutory benefits in place to protect
dismissed employees, the courts have required that employees express a “clear and unequivocal”
intention to resign from their job. An objective test is applied that asks whether a “reasonable
person” of normal intelligence looking at what happened would conclude that the employee had
unequivocally and voluntarily resigned from their job.3 Applying this test, for example, courts
have found that it is not a resignation when an employee tells the employer that they are looking
around for another job, provided that the employee keeps performing their assigned duties in
the meantime.4 An employee who resigns after being given an ultimatum to quit or be fired
(a forced resignation), like Jen mentioned above, will similarly not be found to have quit
because the resignation is not a voluntary expression of a desire to terminate the relationship.5
Probably the best example of how courts insist on a clear demonstration by employees of
their intention to terminate the employment contract is the manner in which they treat sudden,
uncharacteristic outbursts by employees. Even when a frustrated employee utters something like
“I quit” or “I’m done” and then storms out of the workplace, courts have ruled that the employee
did not resign. Employers are expected to pause and allow the employee to cool down before
jumping to the conclusion that the employee intended to terminate the employment relation-
ship.6 A typical example is provided by the decision in Box 15.1.

When Is a Quit Not a Quit?
Upcott v. Savaria Concord Lifts Inc. absent employee and had a run-in with a co-worker who
2009 CanLII 41348 (Ont. Sup Ct J) complained about him to the human resources manager.
When the human resources manager asked Upcott what had
Key Facts: Upcott was a manager with eight years’ service at happened, he responded with a frustrated “I’m done,” threw
Savaria Concord Lifts Inc. On May 8, several things occurred at his keys on the manager’s desk, and left the workplace (after
work to put Upcott in a foul mood. He was told to fill in for an
forced resignation: When an employer puts pressure (directly or indirectly) on an employee to resign or face being fired.

Chapter 15 “I Quit!”: Termination of the Employment Contract by the Employee 239
clearing off his desk and telling several other The law recognizes that such utter-
employees he was “done”). In a telephone call a ances may not constitute a valid res-
couple of hours later, management told Upcott ignation. Nor should such a declaration
that the employer had “accepted his resigna- be accepted without question by the
tion.” Upcott claimed he had not resigned and employer. Rather the onus is on the
sued for wrongful dismissal, arguing that he had employer to not accept such a spon-
been dismissed. taneous declaration without proper
deliberation.
Issue: Did Upcott quit?
The employer rushed to treat Upcott’s ac-
Decision: No. The court ruled that Upcott had
tions as a resignation, whereas it should have
not resigned and, therefore, found that the em-
recognized that Upcott was “having a juvenile
ployer had dismissed him when it refused to
fit of anger” and that he would soon calm down
allow Upcott back in the workplace. In summa-
and express a desire to return to work. For a
rizing the law, the court wrote:
54-year-old management employee with eight
The law is clear that where an emo- years’ service, the appropriate period of reason-
tionally upset and angry employee able notice that the employer should have given
exclaims “I quit,” the issue of whether was 7.5 months. Damages were ordered based
he/she has resigned is not clear cut. on that amount.
However, if an employee expresses a clear intention to resign and then acts consistent with
that intention, a court will find that the employee has resigned.7 So an employee who steadfastly
refused to report to a new job assignment was found to have resigned, since it was within the
employer’s contractual rights to reassign the employee.8 Yet, even when judges find that the em-
ployee intended to resign, they have nevertheless sometimes permitted the employee to change
their mind (“resile” from their resignation), provided that the employer has not yet
1. informed the employee that the resignation is accepted; or

2. acted on the resignation to its detriment, such as, for example, by hiring a
replacement.9
The fact that employees who appear to have resigned might be found not to have done so,
and that courts permit employees to change their minds, places employers in a difficult position.
If the employer treats the employee as having resigned and refuses the employee the right to
return to work, it could be found liable for wrongful dismissal if a court later finds that the em-
ployee had not resigned, as we saw in the Upcott decision.
III. The Requirement for an Employee to Give an Employer

Notice of Termination
If an employee does intend to resign, then they probably need to give the employer notice of that
termination to avoid breaching the contract. That obligation may be found in an expressed term
of the employment contract, but if there is no such term, the common law courts imply a
requirement that employees provide “reasonable notice” of termination, as we learned in Chap-
ter 9. Note though that there are important differences between the rules that govern employee
and employer reasonable notice (we explored the employer’s obligation to provide “reasonable
notice” in Chapter 10).
First, the requirement for an employee to give notice to terminate an employment contract
does not appear in employment standards legislation in every Canadian jurisdiction. This mat-
ter is explored in greater detail in Part III when we look at employment standards regulation,
but briefly, only the legislation of Alberta, Saskatchewan, Nova Scotia, Newfoundland and

abrador, and Manitoba require employees to provide

L
their employer with notice of termination, whereas every
jurisdiction in Canada requires employers to provide
notice to employees.10 Where there is no statutory require-
ment for employees to give notice of termination, the
amount of notice required depends solely on what the
contract requires. In theory, that contract could require no
notice at all, though in practice it would be rare for a con-
tract to include an expressed term allowing an employee
to quit at any time with no notice to the employer.
Most contracts in Canada either set out the amount of
notice the employee must provide to terminate the
employment contract or say nothing at all about notice. A
written contract term might look like this:
The Employee may at any time terminate this Contract by

providing the Employer with two weeks’ written notice.
Failure by the employee to comply with this term would

result in a breach of contract, possibly entitling the em-
ployer to damages. We will discuss what those damages
might be later in this chapter.
If no contract term exists requiring the employee to give notice to terminate the contract,
then the courts imply a term requiring reasonable notice of termination. This leads us to the
second main difference between the legal duties of employees and employers to provide notice:
the manner in which judges assess the amount of reasonable notice required differs for
employees.
The Bardal factors we learned about in Chapter 10 do not guide the calculation of employee
notice.11 To understand why, recall what those factors were intended to do. They act as a proxy
for the approximate amount of time the employee could be expected to take to secure reasonable
alternative employment. That rationale makes little sense when applied to an employee’s obliga-
tion to provide notice. What is the rationale for requiring an employee to give notice of termin-
ation to an employer? Here is how one judge answered that question:
Although what is reasonable must be regarded from the point of view of both parties, I do not think
it necessarily follows that the amount of notice which it would be reasonable for an employee to give
is identical to that which it is reasonable to expect an employer to give. The principal reason why an
employer must give reasonable notice is to enable an employee to find new employment. Similarly
an employee is required to give notice in order to enable an employer to find a replacement.12 [Emphasis
added]
Often, the time it will take an employer to find a replacement employee will be short. Think
of a relatively low-skill factory worker who stocks shelves or a cashier at a retail store. A replace-
ment for that employee can probably be easily found. Maybe the employer can call a temporary
placement agency and get a substitute worker immediately, until it can hire a permanent
replacement. Maybe an existing employee has a friend looking for a job, or maybe a stack of
completed application forms is sitting in a folder in the manager’s office.
The period of reasonable notice required of employees is usually much less than that required
of an employer. In a 2007 decision from Alberta, Torcana Valve Services v. Anderson, the court
wrote that the “usual” period of reasonable notice that an employee must provide an employer
is two weeks for an “ordinary” employee and four weeks for a more senior management

employee. The court wrote that if the employer believes these amounts are insufficient then, “it
is incumbent on [the] employer … to immediately tell the employee what notice is appropriate.
If the employer legitimately needs the employee for a longer period, that should be put on
the table right away.”13 In RBC Dominion Securities Inc. v. Merrill Lynch Canada Inc. et al., a BC
court assessed the period of notice required by a senior manager of an investment business at
only two and a half weeks based on the fact that the industry norm was that relatively little
notice was expected from employees.14 In Engineered Sound Systems Ltd. v. Klampfer, an Ontario
court found that two weeks’ notice of resignation was reasonable for a non-managerial employee
with 15 years’ service.15
However, the courts have occasionally assessed long periods of reasonable notice. In the Tree
Savers International Ltd. v. Savoy decision discussed in Box 15.2, the Alberta Court of Appeal
found that “reasonable notice” was a period of greater than one year.16 In another Ontario deci-
sion, the court found that a management employee should have given between 10 and 12
months’ notice.17 These cases can be considered outliers, but they also serve as a warning of the
unpredictability of courts when it comes to assessing reasonable notice required of employees.

Wrongful Quitting: The Employee’s Requirement to Provide Reasonable Notice of Termination
Tree Savers International Ltd. v. Savoy Decision: The Alberta Court of Appeal ruled that “given their
1992 CanLII 2828 (Alta. CA) seniority and status,” the appropriate period of reasonable
notice for the employees was much longer than two weeks.
Key Facts: Two important employees of Tree Savers Inter- The lower court had assessed the amount at nine months’
national Ltd. (TSI) suddenly quit with two weeks’ notice and notice. The court of appeal thought that the notice period
set up a new business to compete against TSI. No restrictive should be greater than one year, although it did not decide
covenant clause was included in their original contracts with exactly how much greater. The court of appeal calculated the
TSI prohibiting such competition. However, TSI sued the em- damages incurred by the employer as a result of the employ-
ployees for breaching the requirement to provide reasonable ees providing inadequate notice. An expert witness esti-
notice of termination. It argued that, as a result of the abrupt mated that TSI incurred substantial extra costs in travel,
departure of the employees, they incurred substantial costs management expenses, and recruitment costs as a direct
finding competent replacements. result of the failure to give proper notice. The court of appeal
Issue: Was two weeks “reasonable notice” of resignation? If not, estimated the damages to TSI caused by the breach of the
what damages did the employer incur as a result of the failure requirement to provide notice at $73,100 per employee. The
of the employees to provide such notice? employees were ordered to compensate the employer by that
amount.
The application by the courts of the Bardal factors in assessing the amount of reasonable
notice required of employers creates a measure of predictability for both parties. No such pre-
dictability exists in the courts’ assessment of the reasonable notice required of an employee.
Indeed, it is difficult to make sense of the large disparities in the assessed notice periods in the
cases referred to in the preceding list. The fact that judges rarely explain their rationale for
assessing the periods of notice only adds to the unpredictability. It can create the appearance
that judges are just pulling numbers out of the air. The uncertainty surrounding the length of
reasonable notice is probably a good reason for the parties to ensure that a written notice term
is included in an employment contract if the intention is that the employee should provide
notice of termination.
If an employee gives reasonable notice of resignation effective at some date in the future and
the employer responds by telling the employee to leave immediately, the quit is transformed into

a dismissal.18 In this case, the employer must give the employee reasonable notice of termina-
tion, which is equal to the time remaining until the employee’s original notice of resignation
would have expired.19
IV. Calculating Damages When an Employee Fails to Give Proper

Notice of Termination
We learned in Chapter 14 that the theory of damages for breach of contract requires that dam-
ages should be ordered that place innocent parties in the same financial position they would
have found themselves in but for the contractual breach. When an employee is dismissed with-
out notice, it is relatively easy to see what they lost as a result of the contract breach: the chance
to earn the wages and benefits that would have been received had they been given the proper
notice of termination. But what loss does an employer suffer when an employee quits without
giving notice?
Damages are assessed based on the actual harm caused to the employer as a result of lack of
notice, and not the harm incurred due to the decision of the employee to leave.20 Some of the
costs employers incur when an employee quits will be incurred regardless of whether notice is
given or not.21 For example, an employer will need to recruit and train a new employee no mat-
ter what, so these costs cannot usually be attributed to a failure to give notice. The recoverable
damages flowing from a breach of an employee’s duty to give notice could include those result-
ing from the employer’s sudden loss of the employee’s production during the notice period until
such time as a replacement is hired, and other costs that an employer incurs directly as a result
of the failure to give notice.
For example, if the sudden departure of an employee requires the employer to pay a tem-
porary placement agency a fee to quickly send over a “temp” worker, or to temporarily transfer
an existing employee from another location, then that cost could be recoverable. Had the em-
ployee given notice, the employer may not have incurred those expenses.
In practice, the damages employers incur as a result of an employee’s failure to provide notice
of resignation are usually so small that employers do not bother to sue the employee. The cost
of bringing the lawsuit and paying lawyers may be greater than the amount the employer will
recover in damages. Or, as demonstrated in the decision discussed in Box 15.3, the savings from
not having to pay the employee’s wages during the notice period may offset any losses from the
employee’s failure to provide notice, in which case the court will not order any damages to be
paid at all. This reality explains why employers bring far fewer wrongful quitting lawsuits against
employees than employees bring wrongful dismissal lawsuits against employers.

Assessing Damages for Employee’s Failure to Provide Reasonable Notice
Consbec Inc. v. Walker Richard sold his house in Sudbury and drove his family
2016 BCCA 114 to Kamloops. The employer sued Walker for breach of con-
tract for failure to provide reasonable notice of termina-
Key Facts: Walker quit without notice after five years’ tion, arguing that Walker should be ordered to pay for all
service and started his own competing business. As a result of expenses incurred by the employer to send Trevor to Kamloops
Walker’s sudden resignation, the employer had another em- for one month and to move Richard and his family to
ployee (“Trevor”) drive from Sudbury, Ontario, to Kamloops, Kamloops.
British Columbia, to cover for Walker for one month.
Several months later, the employer assigned another em- Issue: How much notice was Walker required to give, and
ployee (“Richard”) to permanently assume Walker’s old job. what damages should he be ordered to pay?

Decision: The BC Court of Appeal found that in assessing the earned $6,000 per month. The expenses incurred as a result
amount of notice required, courts must consider “the em- of the failure to give notice included transportation costs to
ployee’s duties and responsibilities, salary, length of service, get Trevor to Kamloops and back, as well as his hotel and food
and the time it would reasonably take the employer to have costs while in Kamloops, totaling $5,875. Walker was not liable
others handle the employee’s work or to hire a replacement.” for the expenses of moving Richard to Kamloops, since those
Considering all of the facts here, the court assessed the amount costs were not a result of the failure of Walker to give notice;
at one month’s notice. Next, the court addressed what dam- they were the normal costs of having to replace an employee
ages were incurred “as a result Walker’s failure to give notice.” who quit and would have been incurred even if Walker had
The court found that the employer needed to demonstrate given one month’s notice. Since the damages ($5,875) were
that it suffered losses as a result of Walker not giving notice less than the amount the employer saved in Walker’s wages
that exceeded the amount of money it saved from not paying ($6000), the court found that Walker did not owe any damages
Walker’s wages for the one-month notice period. Walker for breach of the notice term.
However, sometimes an employee’s failure to give notice of termination does have serious
financial consequences for the employer, such as in the Tree Savers decision in Box 15.2. In the
RBC Securities case mentioned above, several investment advisers who quit without giving
notice were assessed damages of $40,000 each based on an estimate of the employer’s lost rev-
enues for the period of 2.5 weeks’ notice they should have given the employer.22 In these cases,
where the employer can demonstrate substantial losses due to the failure of the employee to give
notice, it may make sense for an employer to sue the employee.
V. Chapter Summary

This chapter explored legal issues that arise in relation to employee resignations. A resignation
requires a clear intention by the employee to terminate the relationship. A frustrated “I quit!”
may not indicate such an intention, especially if the employee soon afterward recants and
expresses a desire to return to work. Therefore, an employer must not be too hasty in assuming
that an employee has quit, or it may be found to have terminated the employee’s employment
contract. Employees must usually give notice of their intention to terminate the employ
ment contract. The manner in which the courts calculate the reasonable notice required of
employees differs from that applied in assessing the reasonable notice required of employers.
The reasonable notice required of employees is more difficult to predict because the courts are
not guided by a clear formula or set of principles. In assessing damages for a failure of an em-
ployee to give proper notice, the courts assess the harm suffered by the employer due to the
employee’s failure to give notice. Often this harm is nominal, so employers often do not bother
suing employees, but not always.

1. Explain the legal test the courts apply when considering whether an employee has termin-
ated the employment contract.
2. Explain two important differences in the law’s treatment of the notice of termination
required of employees versus employers.
3. What is the rationale for requiring employees to provide employers with reasonable notice
of termination?

4. Can the employer and employee agree to a period of notice required of an employee to
terminate the contract that is different from that of implied “reasonable notice”?
5. On what basis do the courts assess damages for a breach by an employee of the contractual
requirement to give notice of termination?
APPLYING THE LAW

Marnie had worked as a sales manager for Advance Furniture Discuss the arguments that Marnie and the employer might
for 10 years. She’s a good employee with no prior discipline. make.
She has no written employment contract. Yesterday, the em-
ployer announced that it was moving to shift work because it Scenario Two
wants to build up its Asian business. It needs salespeople to Marnie had been contemplating for some time whether to quit
be available for phone calls and online inquiries 24 hours a day and start her own company that would compete with Advance
to align with different time zones. Marnie has always worked Furniture. She sees this change in her shift times as a sign that
9 – 5, and she is angry that she will be required to work eve- it is time to leave Advance. After she left her boss’ office yes-
nings. She storms into her boss’s office and yells, “I’m not terday, Marnie immediately put her business plans into action.
working nights! Either leave me on full-time days or don’t She sent emails to her former Advance customers informing
bother assigning me any more shifts.” Her boss responds that them that she is leaving Advance and that in the coming weeks
everyone will be working some evenings from now on, so she will be opening her own business that provides similar
Marnie will need to adapt or leave. Marnie yells, “I choose the services to Advance but at a lower price point. Within three
latter,” throws down her keys, and leaves. weeks, her business is operating and many of her former Ad-
vance customers have placed orders. Advance estimates that
Scenario One it has lost at least 25 percent of its weekly orders to Marnie’s
Two days later, Marnie wakes up very upset. She loves her job, new business, amounting to about $75,000 over the three-
and the job market is tough right now. She calls her boss and week period it took to hire a replacement for Marnie. Advance
tells him that she has reconsidered, and she will work the shift comes to you for advice on whether it has any legal basis to
work. The boss tells Marnie that it is “too late” and he already sue Marnie and recover lost profits resulting from Marnie
accepted her resignation. If Marnie sues the employer for opening her new business and luring Advance customers.
wrongful dismissal, do you think she would be successful? What would you advise her?

1. A. Newman & R. Rivera, “Fed-Up Flight Attendant Makes 4. Moore v. University of Western Ontario, supra note 3;
Sliding Exit,” New York Times (August 9, 2010), online: Tolman v. Gearmatic Co., 1986 CanLII 1212 (BCCA); Wid-
<http://www.nytimes.com/2010/08/10/ meyer v. Municipal Enterprises Ltd., 1991 CanLII 4413
nyregion/10attendant.html?_r=0>. (NSSC); Mosher v. Twin Cities Co-operative Dairy Limited,
2. See Chan v. Dencan Restaurants Inc., 2011 BCSC 1439. 1984 CanLII 63 (NSSC); Turner v. Westburne Electrical
Inc., 2004 ABQB 605; and Carroll v. Purcee Industrial Con-
3. Kieran v. Ingram Micro Inc., 2004 CanLII 4852 (Ont. CA);
trols Ltd., 2017 ABQB 211 (it is not a clear indication of an
Palumbo v. Research Capital Corp. 2004 CanLII 21628
intention to quit when the employee offers to negotiate
(Ont. CA); Skidd v. Canada Post Corp. (1993), 47 CCEL
new terms of employment).
169 (Ont. Sup Ct J); aff ’d [1997] OJ No. 712 (CA); Moore
v. University of Western Ontario (1985), 8 CCEL 157 (Ont. 5. Chan v. Dencan Restaurants Inc., supra note 2; Ramsay v.
H Ct J); and Avalon Ford Sales (1996) Limited v. Evans, Terrace (City), 2014 BCSC 1292; Deters v. Prince Albert
2017 NLCA 9. In Beggs v. Westport Foods Ltd., 2011 BCCA Fraser House Inc., 1991 CanLII 7933 (SKCA); and
76, the court of appeal said that the test is actually a mixed Backman v. Hyundai Auto Canada, 1990 CanLII 4087
objective and subjective test. (NSSC).

6. Lelievre v. Commerce and Industry Insurance Company of 12. Moore v. Zurich Insurance Co. (1984), 4 CCEL 188 at 192
Canada, 2007 BCSC 253; Widmeyer v. Municipal Enter- (Ont. Co Ct). See also Consbec Inc. v. Walker, 2016 BCCA
prises Ltd., supra note 4; Robinson v. Team Cooperheat- 114 at para 73; Sure-Grip Fasteners Ltd. v. Allgrade Bolt &
MQS Canada Inc., 2008 ABQB 409; Bishop v. Rexel Chain Inc. (1993), 45 CCEL 276 (Ont. Sup Ct J); Oxman v.
Canada Electrical Inc., 2016 BCSC 2351; Avalon Ford Sales Dustbane Enterprises Ltd. (1986), 13 CCEL 209 (Ont. H Ct
(1996) Limited v. Evans, supra note 3; Bru v. AGM Enter- J); Carlsen v. Physique Health Club Ltd. (Physique Fitness
prises Inc., 2008 BCSC 1680; and Upcott v. Savaria Concord Store), 1996 ABCA 358; and GasTOPS Ltd. v. Forsyth, 2009
Lifts, 2009 CanLII 41348 (Ont. Sup Ct J). CanLII 66153 (Ont. Sup Ct J).
7. Kerr v. Valley Volkswagen, 2015 NSCA 7 (an employee who 13. Torcana Valve Services Inc. v. Anderson, 2007 ABQB 356 at
told his employer to give him a raise or “I’m gone” was para 79.
found to have quit when the raise did not happen); and 14. RBC Dominion Securities Inc. v. Merrill Lynch Canada Inc.,
Gould v. Hermes Electronics Ltd. (1978), 34 NSR (2d) supra note 11.
321 (SC).
15. Engineered Sound Systems Ltd. v. Klampfer (1994), 3 CCEL
8. Crouch v. Securitas Canada, 2008 CanLII 201 (Ont. Sup (2d) 105 (Ont. Gen Div).
Ct J). Note also Palumbo v. Research Capital Corp., supra
16. Tree Savers International Ltd. v. Savoy, 1992 CanLII 2828
note 3 (an employer cannot say “accept this change to your
(Alta. CA).
job or we will consider you to have resigned”).
17. GasTOPS Ltd. v. Forsyth, supra note 12 (10 to 12 months’
9. Kieran v. Ingram Micro Inc., supra note 3 (an employee can
notice required for senior managerial employees); Clay-
resile from a resignation as long as the employer has not
burn Industries Ltd. v. Recor Services Inc., 1998 CanLII
relied upon it to its detriment); Kerr v. Valley Volkswagen,
6544 (BCSC) (manager required to give six months’ notice
supra note 7 (if an employer has accepted the resignation,
of resignation); and Sanford Evans List Brokerage v.
then detrimental reliance isn’t needed); Carroll v. Purcee
Trauzzi, 2000 CanLII 22741 (Ont. Sup Ct J) (6 months’
Industrial Controls Ltd., supra note 4; Johal v. Simmons da
notice required of a top manager was reasonable).
Silva LLP, 2016 ONSC 7835; Tolman v. Gearmatic Co., supra
note 4 at para 14; Movileanu v. Valcom Manufacturing 18. If the employee gives notice that is less than “reasonable,”
Group Inc., 2007 CanLII 48989 (Ont. Sup Ct J); Avalon Ford that may constitute a repudiation of the contract as a
Sales (1996) Limited v. Evans, supra note 3; Reis v. Stratford whole, which the employer can treat as a quit: GasTOPS
General Hospital (2007), 163 ACWS (3d) 259 (Ont. Sup Ltd. v. Forsyth, supra note 12.
Ct J) (after the employer accepted a voluntary resignation 19. Oxman v. Dustbane Enterprises Ltd. (1988), 23 CCEL 157
the employee could not resile); and English v. Manulife (Ont. CA). See also Valley First Financial Services Ltd. v.
Financial Corporation, 2018 ONSC 5135 (employee could Trach, 2004 BCCA 312 at paras 90-103; and RBC Domin-
not resile resignation after it was accepted by the employer). ion Securities Inc. v. Merrill Lynch Canada Inc. et al., supra
10. Alberta Employment Standards Code, RSA 2000, c. E-9, note 11 at para 70. See also Zaraweh v. Hermon, Bunbury
s. 58(1); Manitoba Employment Standards Code, CCSM c. & Oke, 2001 BCCA 524 (on the effect of a repudiation of
E110, s. 62.1; Newfoundland & Labrador Labour Standards contract during a notice period).
Act, RSNL 1990, c L-2, s. 52; and Labour Standards 20. Bradley v. Carleton Electric Ltd., 1998 CanLII 7140 (Ont.
Code, RSNS 1989, c 246, s. 7. A range of exceptions and CA) at para 2; and Consbec Inc. v. Walker, supra note 12 at
conditions apply in each legislation. para 75.
11. See discussion in RBC Dominion Securities v. Merrill Lynch 21. Gill v. A & D Precision Ltd., 2010 ONSC 4646 (an em-
Canada, 2003 BCSC 1773 at paras 70-75. But see Woodlock ployee failed to give notice, but the employer suffered no
v. Novacorp International Consulting Inc., 1990 CanLII 915 damages as a result).
(BCCA), per Southin JA, stating that the notice period for 22. RBC Dominion Securities Inc. v. Merrill Lynch Canada Inc.,
an employee and employer are the same. That latter pos- supra note 11.
ition has not prevailed.


C H A P T E R 16
Tort Law and the Employment

Relationship
II. What Is a Tort? 248
• Define tort.
III. An Employer’s Vicarious Liability for Tort Damages Caused
• Define vicarious liability and explain how it applies in the employment by an Employee 248
context. IV. Common Torts That Apply to Work 250
• Describe the elements of the torts that arise most often in lawsuits relating A. Intentional Torts 250
to work law. B. Non-intentional Torts (known as “Negligence”) 254
• Distinguish between intentional torts and non-intentional torts. V. Tort Remedies 258
• Understand when the right to sue for damage caused by tortious acts is VI. Chapter Summary 259
barred by workers’ compensation legislation. Questions and Issues for Discussion 260
Exercise 260
• Describe the types of damages that can be awarded by the courts when a
tort liability is determined.
I. Introduction
In Chapters 1 and 2, we learned that the common law regime encompasses both contract law and
tort law. To this point, we have focused on the law of the employment contract. Tort law has been
addressed a few times over the preceding chapters. For example, we noted in Chapter 14 (on the
damages available in wrongful dismissal lawsuits) that a tort could satisfy the requirement for
an “independent actionable wrong” necessary for the awarding of punitive damages in wrongful
dismissal lawsuits. In Chapter 6 (recruitment and hiring), we introduced the tort of deceit and
the tort of negligent misrepresentation in the context of the job recruitment process. In this
final chapter on the common law regime, we consider the law of tort as it affects the work rela-
tionship in greater detail.
The relationship between tort law and the other parts of the legal system that govern work is
among the most fascinating stories in the law of work. In particular, the manner in which judges
extended the use of tort law to restrain collective worker action, including strikes and picketing,
was richly debated by many of the great labour law scholars of the 20th century.1 Judges applied
existing torts or made up new ones to restrain collective worker action so that they could grant
deceit: A tort in which party A makes a false statement with the intention of misleading party B; party B relies on the false
statement and, as a result, party B suffers a loss. Damages can be recovered for that loss.
negligent misrepresentation: A tort in which party A, owing a duty of care, makes an untrue statement to party B without
sufficient care as to the statement’s accuracy, which party B then relies upon and suffers loss as a result.
247

injunctions to order an end to the action. Tort law and injunctions still play an important role
in the law’s treatment of collective worker activities, which we discuss further in Part IV. In that
part of the text, we also examine the special application of certain torts—such as nuisance,
conspiracy to injure, and trespass to property—to collective worker activities, as well as “eco-
nomic torts,” created specifically to deal with trade union activities. We consider the tort of
passing off in the online supplemental chapter, “Intellectual Property Law and Work,” refer-
enced on p. xxi in the preface of this book.
This chapter focuses on other applications of tort law to work. It begins with an introduction
to torts and to vicarious liability, a legal mechanism through which an employer is held liable
for damages resulting from torts committed by its employees. It then reviews some of the most
important torts that have application to the work context, concluding with a discussion of dam-
ages in tort cases.
II. What Is a Tort?

Torts are types of wrongful acts done by one person to another (or to another’s property) that
judges have recognized as legally actionable. The word “tort” comes from the Latin tortum,
which means, roughly, “wrong.”2 Tort law regulates conflicts that arise in everyday life, often
between complete strangers. It attempts to assign the costs of harmful behaviour to those who
are at fault, even when there is no contract between the perpetrator and the victim. Its origins
rest in judges’ attempts to resolve lingering arguments over property and other disputes through
legal means rather than open warfare and violence. As Professor Daniel Shuman puts it, tort law
is “rooted in the legal system’s search for an alternative to the blood feud.”3 Not every perceived
wrong is a tort. Over time, judges have developed a list of torts that involve harmful conduct
thought to be deserving of legal liability. Some of these torts involve intentional wrongful acts,
while others are based on accidental conduct that the court believes was avoidable with basic
precautions.
III. An Employer’s Vicarious Liability for Tort Damages Caused

by an Employee
In many tort cases involving harm caused by an employee, the victim seeks to hold the employer
liable for damages. The victim takes this approach because the employer has money and the
employee who actually caused the harm does not. Law students learn early in tort class that
when you represent the victim, you should always go after the party with “the deep pockets.” An
employer often has insurance to cover the risk of being sued, and the victim wants to access
those funds. Much of the legal strategy in tort law involves attempts to access insurance
benefits.
injunction: A legal order issued by a judge prohibiting a person from engaging in a particular course of action, such as breach-
ing a contract, committing a tort, or violating a statute.
nuisance: A tort in which the activities of one person unreasonably interfere with the use or enjoyment of the property of
another person.
conspiracy to injure: A tort that involves two or more people acting in combination with the intention of causing harm to
another party and actually causing that harm.
trespass to property: A tort in which one person intentionally enters another person’s property without the property owner’s
permission; as well, it can involve a refusal to leave a property when instructed by the property owner to leave.
passing off: A tort that involves deceiving consumers into believing that the good, service, or business of one company or
person is really that of another, thereby misrepresenting the source.

Chapter 16 Tort Law and the Employment Relationship 249
Vicarious liability is the legal mechanism through which an employer is held liable for torts
committed by its employees.4 Vicarious liability holds one person (or company) liable for damage
caused by the misconduct of another person when it is fair to do so because of the close nature
of their relationship. The Supreme Court of Canada has noted that the employment relationship
is “the most common one to give rise to vicarious liability” while also cautioning that companies
will not generally be vicariously liable for the acts of independent contractors (recall the discus-
sion of the distinction between an employee and an independent contractor in Chapter 4).5
Holding employers vicariously responsible for the wrongful actions of their employees is
controversial because it assigns responsibility to the employer, who is not personally at fault.
However, the courts have defended vicarious liability on three grounds. First, since employers
put “in the community an enterprise which carries with it certain risks,” it is fair that they should
bear the loss when those risks materialize and create harm.6 Second, holding employers respon-
sible for the wrongs committed by their employees produces a deterrent effect that will encour-
age employers to take all reasonable precautions to reduce the risk of harm. And third,
employers have a greater capacity to bear financial loss than do their employees through com-
mercial insurance and actions such as raising product or service prices.
Employers are not vicariously liable for every tort committed by their employees. The wrong-
ful act must have been done “in the course of employment.” If the wrongful act occurs while
employees are performing their usual duties or are on work business, then it is obvious that the
act was done in the course of employment.7 However, sometimes that link is not so clear. For
example, when an employee commits a tort at work without the knowledge or authorization of
the employer, and perhaps against the direct orders of the employer, is the employee acting “in
the course of employment”? The case discussed in Box 16.1 addresses this question.8

Employer’s Vicarious Liability for Wrongful Acts Committed by Its Employees
Bazley v. Curry
[1999] 2 SCR 534 [T]here must be a strong connection between what
the employer was asking the employee to do (the
Key Facts: Curry was employed by the Children’s Foundation risk created by the employer’s enterprise) and
in a care facility for treatment of emotionally troubled children. the wrongful act. It must be possible to say that the
His job included bathing kids and putting them to bed. In time, employer significantly increased the risk of the harm
Curry began a campaign of sexual assault against Bazley, a by putting the employee in his or her position and
young boy in the care of the foundation. When the employer requiring him to perform the assigned tasks.
learned of the abuse, it immediately fired Curry, and later Curry
was convicted of 19 counts of sexual abuse. Bazley sued Curry A wrongful act that just happens to occur during working
(who had since died) and sought to hold the employer (the hours will not alone be sufficient grounds for vicarious liability.
Children’s Foundation) vicariously liable for damages caused However, when the employee’s actions are closely connected
by Curry. to the job the employee is expected to perform, then it is fair
to hold the employer vicariously liable. In this case, the assaults
Issue: Was the Children’s Foundation vicariously liable for as-
took place while the employee was performing duties that fell
saults committed by its employee, Curry?
within the scope of his job (bathing, bedtime, etc.). By giving
Decision: Yes. The Supreme Court of Canada reviewed the Curry those duties, the employer increased the risk of the as-
rules on when employers should be held vicariously liable for saults, even if it was not aware that Curry was a pedophile. The
the acts of their employees and summarized them as Supreme Court found that the Children’s Foundation was vi-
follows: cariously liable for damages caused by its employee, Curry.
vicarious liability: A legal rule under which an employer is liable for damage caused to a third party by one or more of its
employees.

If the employee’s wrongful act is completely unrelated to the business of the employer and the
scope of work assigned to the employee,9 or takes place during the employee’s personal time and
outside the workplace with no connection to the employer’s enterprise,10 then the employer will
not be vicariously liable.
IV. Common Torts That Apply to Work

Torts can be divided into two categories: (1) intentional torts and (2) non-intentional torts
(negligence). The principal difference between the two categories is the manner in which fault
is assigned. An intentional tort is one in which the perpetrator engages in conduct that is
intended to produce the harm that results, or at least conduct in which harm was an obvious
outcome. A negligence or non-intentional tort involves harm that was not intended but that
would have been avoided had reasonable precautions been taken. Torts comprise multiple “ele-
ments,” or parts, that the victim must establish in evidence before the court. Each element of the
tort must be proven. The elements of the most common torts that arise in work-related disputes
appear at the beginning of each of the tort descriptions that follow.
A. Intentional Torts

1. Intentional Infliction of Mental Suffering
Elements:
1. A engaged in flagrant or outrageous conduct toward B.

2. A desired to produce the kind of harm that was actually suffered by B, or A knew that
the harm was substantially certain to follow.
3. The conduct by A resulted in a provable illness to B.11
The tort of intentional infliction of mental suffering derives from an 1897 decision in which
a cruel practical joker told a woman that her husband had broken both of his legs in an accident,
which was not true. The woman suffered shock and became seriously ill. The court ruled that a
person who wilfully does something intended to psychologically harm another person is com-
mitting a tort.12 In more modern times, this tort has been applied to employers who engage in
behaviour toward an employee that the court finds outrageous and that causes the employee
mental suffering.13
For example, in a 2014 decision, Boucher v. Wal-Mart Canada, the Ontario Court of Appeal
approved a jury award of $100,000 for the tort of intentional infliction of mental suffering where
a manager engaged in deliberate, flagrant harassment of an employee designed to force the em-
ployee to quit.14 A leading case involving this tort is discussed in Box 16.2.

Intentional Infliction of Mental Suffering by an Employer
Prinzo v. Baycrest Centre for Geriatric Care able to work for several months. During her absence, a man-
2002 CanLII 45005 (Ont. CA) ager routinely and persistently called Prinzo at home, asking
when she would be returning to work. The calls caused Prinzo
Key Facts: Prinzo had worked for Baycrest for over 17 years emotional distress, and it was clear that the manager believed
when she fell in the parking lot, injuring herself. She was un- Prinzo was not really as injured as she claimed. At one point,
intentional infliction of mental suffering: A tort in which a person or employer engages in outrageous harmful conduct
toward another with the intention to cause harm that actually occurs.

the employer sent Prinzo a letter that suggested her doctor Decision: Yes. By harassing Prinzo through repetitive phone
had said she was able to return to work. That was not true. calls about returning to work (when Baycrest knew the calls
Later, the employer told her to return to work on modified were causing her emotional distress) and by falsely claiming
duties, but Prinzo said her doctor had not advised that she that Prinzo’s doctor had said she could return to work, the
could do that. Prinzo’s lawyer asked the employer to contact employer’s actions satisfied the elements of the tort. The em-
him rather than Prinzo because the calls were upsetting her, ployer was aware that its behaviour was causing emotional
but the employer kept calling Prinzo. The employer threatened distress, and because it continued to engage in that behaviour
Prinzo with termination if she did not return. Soon after she it desired that result. Evidence showed that the harassment
returned to work, she was given notice of termination. caused Prinzo real physical harm. The court of appeal awarded
Prinzo $15,000 damages for intentional infliction of mental
Issue: Did the employer’s conduct amount to the tort of in-
and physical harm.
tentional infliction of mental suffering?
2. Assault and Battery

The tort of assault involves making threats of physical violence that causes someone to reason-
ably fear they are in danger of imminent harm. Battery involves actual unwanted physical
contact that either causes the victim harm or is offensive or insulting to the victim. Often the
torts of assault and battery are pleaded together when there has been physical contact, but they
are distinct torts. In Piresferreira v. Ayotte, the Ontario Court of Appeal found that a manager
committed the tort of assault and battery when he screamed at and then shoved an employee in
the shoulder, causing her to stumble backwards. The court ordered the employer to pay $15,000
in damages for the assault in addition to other damages for wrongful dismissal.15
3. Intimidation
Elements:
1. A threatened B that they would commit an unlawful act (such as a crime, tort, or breach
of a contract) unless B did as A wished.
2. As a result of the threat, B did not do something that they were legally entitled to do.
3. As a result of B not doing that something, either B or another party suffered
damages.16
Intimidation involves an attempt to coerce another person to do something or to refrain

from doing something they are entitled to do by the threat of an unlawful act. In the famous case
of Rookes v. Barnard, several officials of a British union threatened to cause an unlawful strike
against an employer in violation of a collective agreement unless the employer fired an employee
with whom the union had a beef.17 The employee (Rookes) was dismissed when the employer
acceded to the threat. The House of Lords ruled that the union officials had committed the tort
of intimidation by threatening an unlawful act (breach of a contract) that led Rookes to suffer
damage (loss of wages). Rookes involved an unusual factual scenario. However, the tort of
intimidation would apply, for example, to an employer who threatened an employee with
assault: A tort that involves a threat of imminent physical harm.

battery: A tort that involves unwanted physical contact that either causes the victim harm or is offensive or insulting to the
victim.
intimidation: A tort that involves an attempt to coerce another person to do something or to refrain from doing something
they are entitled to do by the threat of an unlawful act.

summary dismissal if the employee did not agree to quit, provided that the employer was not
legally entitled to dismiss the employee for cause.18
4. Defamation
Elements:
1. A made untrue comments about B that would tend to lower B’s reputation in the eyes
of a reasonable person.
2. The comments were communicated to at least one person (other than B).19
The tort of defamation involves false statements about a person that tend to harm the per-
son’s reputation. It can take the form of spoken comments (slander) or written statements (libel).
It is often pleaded when an employer or employee makes derogatory comments about the other.
For example, an employer may accuse an employee of being a thief, or an employee may post
derogatory comments about the employer on a social media site, such as Facebook. The party
claiming defamation must prove the elements of the tort listed above, at which point the onus
shifts to the other party to argue one of the defences that the courts have recognized.
One defence is justification, which means that the plain meaning of the comments, as well
as the normal implications associated with those words, are “substantially true.”20 In one case,
an employee stood outside his ex-employer’s premises wearing a sandwich board that read
“Teacher fired for asking [employer] to stop breaking the law.” The court ruled that the employee
defamed the ex-employer, and the employee had failed to make out the defence of justification
since in fact he had not been fired for asking the employer to stop breaking the law; he had been
fired for cause for violating the employer’s code of conduct. The employee was ordered to pay
$1,500 in damages for harm to the employer’s reputation.21 In the case of Hawley v. Webb, the
employer defamed an ex-employee when it told a third party that the employee was dishonest
and incompetent. Since the court found no factual basis for those conclusions, it ordered dam-
ages amounting to $50,000 for defamation.22
Another defence is qualified privilege. A defamatory statement is presumed to be motivated
by malice and is therefore unlawful. The “qualified privilege” defence rebuts that presumption
in situations where, for policy reasons, the courts wish to encourage the expression of frank
opinions.23 One such situation involves employee job references written by employers. Qualified
privilege protects the right of an employer to give a negative employee reference, provided that
the employer is not acting with malice. For example, in the case of Mejia v. LaSalle College a
former employer informed a business that was considering hiring one of its ex-employees that
the employee was not a team player, that he had personality problems, and that his mental state
was questionable. The defamation action was dismissed, because the court ruled that the de-
fence of qualified privilege applied. The employer had stated his personal opinion when asked,
and that opinion was not tainted by malice.24
5. Inducing Breach of Contract

Elements:
1. A had a contract with B.

2. C was aware of the contract between A and B.
defamation: A tort that involves false statements about a person that tend to harm the person’s reputation; written defamation
statements are called libel, and spoken defamation statements are called slander.
justification: A defence to a defamation lawsuit based on the claim that the comments are “substantially true.”
qualified privilege: A defence to a defamation lawsuit based on the claim that public policy supports frank and honest
opinions in the circumstances, and the comments are made without malice.

3. C intentionally caused the breach of that contract.

4. As a result, A suffered damages.25
The tort of inducing breach of contract involves wrongful acts by a third party that cause a
breach of contract between two other parties. This tort has played an important historical role
in the courts’ attempts to restrict collective actions of employees, such as strikes and picketing.
For example, imagine that union leaders organize a picket line in front of a business for the pur-
pose of preventing the company’s employees or suppliers from getting into the workplace and,
as a result, the employees or suppliers breach their contract with the company. Can you see how
that behaviour by the union leaders could satisfy the elements of the tort of inducing breach of
contract?26 We will look more closely at the role of torts in collective bargaining law in Part IV
of the text.
Canadian judges have long used tort law creatively to restrict collective worker actions such as picketing.
In the case considered in Box 16.3, Cogeco refused to allow an employee of a contractor
retained to install cable to work on Cogeco projects and, consequently, the contractor wrong-
fully dismissed the employee. The issue in the case was whether Cogeco induced the contractor
to breach its employment contract by denying the employee the right to work on Cogeco
projects.
inducing breach of contract: A tort that involves wrongful acts by a third party that are intended to cause a breach of
contract between two other parties.


Inducing Breach of Contract
Drouillard v. Cogeco Cable Inc. Decision: Yes. All of the elements of the tort were established.
2007 ONCA 322 First, Drouillard had an employment contract with Mastec.
Second, Cogeco was aware of that contract. Third, Cogeco
Key Facts: Drouillard was hired by Mastec as a cable installer “intentionally” caused the breach of that contract. The court
in Windsor, Ontario. Mastec assigned Drouillard to work on a ruled that this element is made out if Cogeco either desired
project for Cogeco, Mastec’s largest customer. However, just that a breach occur, acted with the knowledge that its actions
hours after Drouillard began work at one of Cogeco’s worksites, would likely cause a breach of the contract, or acted with indif-
he was sent home and then informed by Mastec that Cogeco ference to whether or not its actions would likely cause Mastec
would not permit him to work on its projects. Mastec then to wrongfully dismiss Drouillard. The facts disclosed that a
terminated Drouillard’s employment contract without the representative of Cogeco suggested “ominously” to Mastec
proper contractual notice. Drouillard sued Mastec in contract that it was in the best interests of Mastec to get rid of Drouil-
for wrongful dismissal and sued Cogeco in tort for inducing lard. This action demonstrated that Cogeco was indifferent to
the breach of the employment contract between Mastec and whether Mastec complied with its contract with Drouillard, as
himself. long as Drouillard was fired. Fourth, Drouillard lost his job. The
Issue: Did Cogeco commit the tort of inducing Mastec to court ordered Cogeco to pay damages amounting to $137,535
breach its employment contract with Drouillard? for lost wages plus $62,465 for additional damage done to a
promising career.
B. Non-intentional Torts (Known as “Negligence”)

Elements:
1. A had a legal duty of care to B.

2. A behaved in a manner that fell short of the applicable standard of care required.
3. B suffered damages that were caused by A’s behaviour.27
Negligence involves an unintended breach of a legal duty recognized by the courts that
results in damage to another person. Since almost any action by a person could conceivably start
a chain of events that leads another to be harmed, the courts have constructed boundaries to
identify when a person ought to be held liable for harm caused by their actions. We do not want
people rushing to court every time someone else’s actions harm them in some manner. However,
people ought to be held responsible at least sometimes for damage caused by their actions. The
law of negligence is the mechanism through which the courts define the boundary between legal
responsibility for unintended harm and purely accidental damage for which a person ought not
to be held responsible. As we will see, the ability to sue for negligence for acts done in the course
of employment has been restricted by passage of workers’ compensation and occupational
health and safety legislation. However, the tort of negligence is still a relevant and important part
of the law of work.
1. The Duty of Care and the Standard of Care

The law of negligence is extremely complicated. We will introduce only the main aspects of
negligence as it applies to the work setting in broad brush strokes.28 First, we need to understand
when negligence applies. As the elements listed in the preceding section describe, negligence
negligence: A tort that involves a non-intentional, careless, or reckless act that breaches a legally recognized duty of care and
results in damage to another person.

requires both (1) the existence of a legal duty of care and (2) a failure to meet the legal standard
of care applicable to the relationship involved.
The duty of care defines the types of relationships that can give rise to negligence claims. If I
do not owe you a legally recognized duty of care, then I cannot be guilty of negligence toward
you, even if my actions cause you harm.29 The courts decide when a duty of care exists by con-
sidering whether the damage that occurred was “reasonably foreseeable” and, if so, whether the
relationship between the actor and the victim is sufficiently close (or “proximate”) that a duty to
take care not to injure the victim should be recognized.30 A legal duty of care has been found to
exist in a number of relationships relevant to us. For example, employers have been found to owe
a duty of care to their employees (although as we will discuss shortly, legislation has restricted
the range of negligence lawsuits employees can bring against their employers).31
For policy reasons, the courts have been reluctant to find that a duty of care is owed by employ-
ees to their employers.32 Employers are presumed to understand that employees make mistakes that
create the potential for damage, and that employees rarely have the financial means to reimburse
aggrieved parties in negligence lawsuits. Employers are “in a better position than the employee to
internalize the cost of ordinary employee negligence” by taking out insurance, for example.33 In
addition, the inherent power imbalance between employer and employee we noted earlier in the
text has mitigated against the courts recognizing a duty of care owed by employee to employer, as
noted by the Ontario Court of Appeal: “there is a power imbalance inherent in most employment
relationships. An employee is usually not in a position to bargain at the outset of the employ
ment relationship regarding the terms of his or her potential liability for an act of negligence.”34
However, although the courts have resisted recognizing a general duty of care on employees
to avoid all mistakes, they have recognized that employees owe a duty of care to their employers
to avoid “gross negligence.”35 The courts have also found that employees owe a duty of care to
their employer’s customers when the work they perform involves the “very essence” of the ser-
vice the customer contracted with the employer to perform. For example, employees of a dry
cleaner would have a duty of care to not ruin customers’ clothes, and if they do so, the customer
could sue the employees for the tort of negligence (and probably the employer for vicarious lia-
bility, as discussed earlier).36 Most professional employees owe a duty of care to their patients or
clients, and an entire field of legal practice is devoted to professional negligence lawsuits filed
against doctors, lawyers, engineers, and other professionals.37
If a duty of care exists, then the court must decide on the standard of care expected. That
standard depends on the relationship in question, but it is assessed based on the application of
an objective test (the “reasonable person” test), which was discussed in Chapter 7. For example,
in the employment context, a court would ask how a reasonable employer or employee would be
expected to behave in the circumstances. A leading Canadian tort text describes the employer’s
standard of care toward its employees as follows: “The employer is under a common law obliga-
tion to use reasonable care to prevent injury or harm from foreseeable danger of which the em-
ployer is aware or of which he ought, as a reasonable man, to be aware.”38 For a professional, the
standard of care expected is that of a “reasonably competent” person within that profession.39
Finally, if a duty of care exists and the defendant failed to meet the necessary standard of care,
the court must assess whether the conduct in question actually caused (“causation”) the injury
duty of care: A special close relationship between two parties that creates an obligation in tort law to take reasonable steps
to avoid harming the other party.
standard of care: In the application of the tort of negligence, the level of care expected of a party that has a legal duty of
care to not harm others.
professional negligence: The special application of the tort of negligence to professionals, such as doctors, lawyers, and
engineers.

or damages suffered by the victim, and whether those damages were “reasonably foreseeable.”
Only reasonably foreseeable damages are recoverable in negligence cases.
2. The Limited Availability of Negligence Actions Related to Workplace Injuries

Negligent acts that occur in the performance of employment can lead to serious injuries or even
death. An employer who assigns an employee to work on an unsafe machine might be negligent
if that employee is injured or killed.40 An employee may act negligently in performing their job
and injure another person. However, the ability to sue for negligence for injuries or death result-
ing from an accident occurring “in the course of employment” was restricted by the passage of
workers’ compensation legislation by Canadian governments beginning in the early 20th cen-
tury.41 The Alberta Workers’ Compensation Act provides an example of a typical Canadian statu-
tory provision barring negligence lawsuits for injuries or death resulting from any
employment-related accident. “Accident” is defined as one that “arises out of and occurs in the
course of employment” (s. 1(1)(a)), and then section 21(2) reads:
This Act and the regulations apply instead of all rights and causes of action, statutory or otherwise,
to which a worker, the worker’s legal personal representatives or the worker’s dependants are or might
become entitled against the employer of the worker by reason of any accident happening to the
worker, and no action in respect of that accident lies against the employer.42
Workers' compensation legislation today restricts the right of workers to sue their employer for the tort of
negligence when they are injured "in the course of employment.” Instead, the employee can claim compensation
under the workers' compensation insurance system.
Other provinces similarly exclude the right to sue in negligence for employment-related in-
juries, transferring these claims to the regulatory standards regime. Workers’ compensation
legislation invokes a trade-off: allowing employees to recover damages for lost wages for work-
related injuries through a no-fault insurance scheme in exchange for eliminating the right to sue

for damages in tort law. Workers’ compensation will be examined in Chapter 24. However, it is
important to note that the trade-off only applies when the employer and the accident itself fall
within the scope of the workers’ compensation legislation. Therefore, if the employer is
exempted from the legislation, or the accident did not occur “in the course of employment,” then
people injured by an employee’s actions can still sue the employee for negligence and possibly
the employer for vicarious liability, as the case discussed in Box 16.4 demonstrates.43

Negligence Causing Work Accident
Rudd v. Hamiota Feedlot Ltd. evidence the employees were given any instruction
2006 MBQB 22 on the proper care of their horses. There is no evi-
dence the head pen-rider supervised the Plaintiff in
Key Facts: Rudd was employed by Hamiota in a job requiring any way. The evidence establishes that once [the
skilled horse riding (she was a pen rider). The horse she was horse] lost his shoe, [Rudd] notified [a supervisor] of
riding on the day in question was missing a shoe on one of its her situation. The Defendant called no evidence of
front legs. The absence of the shoe led to an accident in which any actions taken to assist the Plaintiff by providing
the horse fell while navigating a corner, seriously injuring Rudd another horse for her to ride or of advising her not
when she fell off the horse. The employer was exempt from to ride [the horse] until [the horse had been
the Manitoba Workers Compensation Act, so Rudd could not re-shoed].
claim benefits under that legislation, but she was not pro-
hibited from suing the employer for negligence, which she did. On the question of whether the negligence caused that
Issue: Was the employer negligent and, if so, what damage to injury, the court concluded that the employer’s conduct “cre-
Rudd did that negligence cause? ated a risk of harm and that the injury occurred within the area
of risk.” The court found that Rudd was also negligent, because
Decision: Yes, the employer was negligent. The court found she knew it was dangerous to ride a horse with a missing shoe.
that the employer owed a duty of care to Rudd: “That an em- Therefore, the court ruled that she was one-third responsible
ployer owes a duty of care to their employees is well estab- for the injury (a concept known as contributory negligence).
lished law.” In summarizing the evidence that the employer The court calculated the damages as follows: $125,000 for
breached that duty, the court wrote: “non-pecuniary” damages (loss of enjoyment of life and hap-
piness); $296,000 for loss of future earnings due to her perma-
There is no evidence that any representative of the nent disability; and $42,000 for lost income up to the date of
Defendant discussed the dangers of pen riding or the decision (special damages); for a total of $463,000. The
how to avoid them with the Plaintiff. There was no employer was ordered to pay two-thirds of those damages.
If an employee is injured in a manner that is not “in the course of employment,” but is still
the result of the employer’s negligence, then the employee can sue for negligence. For example,
in the case of Jacobsen v. Nike Canada Ltd., the employer was found to be negligent in offering
a large volume of alcohol to an employee during working hours and then failing to monitor and
take reasonable steps to ensure the employee did not drive home in an impaired state.44 The
employee crashed his car on the way home and became a quadriplegic. The court ordered dam-
ages against Nike amounting to over $2.7 million.
The courts have recognized special categories of negligence that apply to employment. Neg-
ligent hiring is an example, which can occur if an employer ignores evidence that a job a pplicant
contributory negligence: Negligence of an injured party that contributes to the loss suffered or damage incurred due to
the negligence of another party.
negligent hiring: A claim made by an injured party against an employer or job recruiter stating that reasonable steps were
not taken to investigate the background of an employee who caused harm.

poses a risk to co-workers or customers or fails to take steps a reasonable employer would take
to limit that risk.45 And as discussed in Chapter 6, the courts have applied the tort of negligent
misrepresentation to representations made during the recruitment stage (recall the case of
Queen v. Cognos Inc., discussed in Box 6.2).46 However, for various policy reasons, the courts
have also refused to apply some categories of negligence to employment settings. As demon-
strated in Box 16.5, policy concerns have played an important role in the development of negli-
gence torts in the realm of work law.

The Role of Policy in the Law of Negligence
Earlier in this chapter, we noted that the courts have defended intrusion by the courts into the workplace” and would have “a
the right of victims of work-related accidents to sue employers real potential to constrain efforts to achieve increased
under the doctrine of vicarious liability on policy grounds. efficiencies.”§
Holding employers liable for harm caused by their employees In the case of Correia v. Canac Kitchens, the Ontario Court
in the course of their employment makes good policy sense of Appeal ruled that an employee could sue a private investiga-
because it encourages employers to emphasize safe work tor retained by the employer for “negligent investigation” after
practices, and employers are better able than employees to the investigator wrongfully accused the employee of theft,
absorb the risks and costs of those harms by purchasing insur- leading to the employee’s wrongful dismissal and arrest.**
ance or passing on costs to consumers.* The courts have also However, the court ruled that the employee could not sue the
declined to recognize a duty of care owed by employees to employer for “negligent investigation,” again relying on policy
their employer for similar policy reasons, and also because they concerns. The court wrote that allowing employees to sue their
recognize that inequality of bargaining power ensures most employers in tort for negligent investigations of suspected
employees will be unable to negotiate contract terms that employee wrongdoing might discourage employers from re-
adequately protect them from tort liability.† porting suspected crimes to the police.
At the same time, the courts have also relied on policy Finally, in the recent decision in Merrifield v. Canada (A.G.),
reasons to reject attempts by employees to expand the reach the Ontario Court of Appeal refused to recognize a new “tort
of tort law to some types of employer conduct. For example, of harassment” that would apply in the employment context
in the case of Wallace v. United Grain Growers Ltd., discussed on the basis that other remedies already exist, including the
in Chapter 14, the Supreme Court of Canada refused to rec- tort of intentional infliction of mental suffering, and that tort
ognize a tort of “bad faith discharge” on the basis that it law should evolve slowly and there is no need to recognize a
would “constitute a radical shift in the law,” which the court similar tort of harassment that would drop the requirement for
ruled was “a step better left to be taken by the the actions to be “intentional.”#
legislatures.”‡
In the case of Piresferreira v. Ayotte, the Ontario Court of * Bazley v. Curry, [1999] 2 SCR 534.
Appeal ruled that the tort of “negligent infliction of mental † Douglas v. Kinger, 2008 ONCA 452 at para 61.
suffering” does not apply to the employment setting. The court
‡ Wallace v. United Grain Growers Ltd., [1997] 3 SCR 701 at para 77.
ruled that imposing a tort-based duty of care on employers
to protect employees from all unintended harms throughout § Piresferreira v. Ayotte, 2010 ONCA 384.
the employment relationship was unnecessary and un- ** Correia v. Canac Kitchens, 2008 ONCA 506.
warranted (since there are often contract law ‑ based rem-
edies). The court added that doing so “would be a considerable # Merrifield v. Canada (Attorney General), 2019 ONCA 205.
V. Tort Remedies

The victim of a tort can recover damages from the person who commits the tort (known as the
“tortfeasor”), and in some cases obtain an injunction. An injunction is a court order that
tortfeasor: A person who commits a tort.

requires a person or company to stop committing a tort. For example, an injunction might order
a person to stop publishing something that is defamatory, or it might order picketers to stop
picketing in a manner that constitutes a tort such as inducing breach of a contract. An injunc-
tion can be temporary (interlocutory injunction) or permanent. The interlocutory injunction
is the most important tort remedy used by the courts to restrict labour strikes and picketing, as
we will discuss in Part IV. A refusal to obey an injunction order can result in a finding of con-
tempt of court, which can lead to a fine or even imprisonment.
The objective of compensatory damages is to assess a monetary amount that as much as pos-
sible places the victim in the same position they would have found themselves in had the tort
not occurred.47 Courts divide these damages into (1) pecuniary damages and (2) non-
pecuniary damages. Pecuniary damages are assessed based on a calculation of the financial loss
incurred by the victim as a result of the tort. They can include reimbursement for financial
expenses and losses already incurred by the victim, such as medical expenses and lost wages
(sometimes called “special damages”), as well as for future anticipated expenses that the victim
will incur as a result of the harm caused by the tort, such as future medical expenses and loss of
future income from jobs that the victim can no longer perform (sometimes called “general dam-
ages”). Non-pecuniary damages are not based on financial expenses and losses but instead
compensate the tort victim for personal harms like anxiety, emotional distress, and loss of enjoy-
ment of life (similar to “aggravated damages” in contract law, discussed in Chapter 14).
In a negligence (non-intentional) claim, the damages that can be awarded are limited to those
that were a “reasonably foreseeable” outcome of the wrongful act.48 In the case of intentional
torts, on the other hand, damages are not so restrained; the intentional wrongdoer is liable for
the damage their actions cause, whether foreseeable or not.49 In this way, intentional torts are
treated more harshly than negligence torts in terms of damages.50
Finally, as discussed in Chapter 14, in order for a court to award punitive damages—
damages intended to punish an employer for egregious, malicious, and high-handed
behaviour51—in a wrongful dismissal lawsuit, a court must find that the employer committed
an “independently actionable wrong” separate and apart from the failure to provide the em-
ployee with reasonable notice. Torts such as intentional infliction of mental suffering and defa-
mation can satisfy this requirement. Therefore, employees sometimes sue their employers for
wrongful dismissal (breach of contract) and in tort to recover both damages for breach of con-
tract (based on failure to give notice of termination) and tort damages.52
VI. Chapter Summary

This chapter summarizes some of the most important torts that have application to the employ-
ment setting. Torts are either intentional or non-intentional (known as negligence), and both
types have been applied to disputes arising from employment relationships. Torts are judge-
created legal wrongs that permit people (or businesses) to recover damages suffered as a result
of the misconduct of another. We noted in this chapter that the development of tort law in the
interlocutory injunction: A temporary court order prohibiting conduct that is potentially unlawful until a decision is released
by the court on whether the conduct is unlawful.
pecuniary damages: Damages awarded in a tort case that are quantifiable in monetary terms (i.e., financial losses such as
medical bills, lost wages, loss of future earnings, costs of future medical care).
non-pecuniary damages: Damages awarded in a tort for losses that are intangible or non-financial in nature, such as hurt
feelings, emotional distress, or loss of enjoyment of life.
punitive damages: Damages ordered against a party who engages in outrageous or egregious behaviour deserving of special
denunciation and retribution.

context of employment has been heavily shaped by the courts’ policy concerns about what
makes sense in the employment setting. We will revisit tort law in Part IV when we explore how
the courts have used torts to regulate and restrain collective worker activities, including union-
ization, picketing, and strikes.

1. What is vicarious liability? In what circumstances will a court impose it on an employer?
Describe the policy reasons the courts have relied on to justify applying vicarious liability
on employers.
2. Explain two defences to a defamation lawsuit.
3. In what circumstances can an employee sue an employer for negligence that results in the
employee’s injury?
4. Explain the various types of remedies available to the victim of a tort.
5. Describe how policy concerns have influenced the development of tort law as it applies to
work.
APPLYING THE LAW

1. Would any of the following hypothetical factual scen- c. Employees Jeanot and Christine are angry with
arios give rise to a tort action in your opinion? If so, their employer. One day they stand at the front
which tort? If you think more information is required door of the workplace and ask other employees to
to make a judgment, what information would you join them in not going to work that day. Jeanot
need? tells employees that if they walk past him and go to
a. An employer tells a prospective employer of an ex- work, he will be very angry with them. Christine
employee that the employee was fired for cause tells the employees that if they walk past her and
when that is not the case. go to work, she will slash their car tires.
b. Microsoft offers two employees of Apple a signing
bonus of $10,000 if they quit Apple immediately
and come to work for Microsoft.
EXERCISE
In Box 16.1, we considered the case of Bazley v. Curry. In that case, the Supreme Court of
Canada held that an employer was vicariously liable for the tort of battery and sexual assault
committed by an employee. Review the summary of that case. On the same day that Bazley was
released, the Supreme Court released a companion case in which it ruled that a boys and girls
club was not vicariously liable for the sexual abuse committed by an employee. That case is called
Jacobi v. Griffiths. To understand the different outcomes, try the following exercise:

2. In the “Case name” search box, type “Jacobi v. Griffiths” and retrieve the Supreme Court
decision.
3. The majority decision begins at paragraph 29. Read the decision, or at least the discussion
of how the test for vicarious liability developed in Bazley v. Curry (referred to by the court
as “Children’s Foundation”) applies to the facts in Jacobi v. Griffiths (paragraphs 79 to 87).
4. Why did the two cases lead to different decisions on the tort of vicarious liability?


1. See, for example, W. Wedderburn, “Strike Law and the company not liable for sexual assault committed by one of
Labour Injunction: The British Experience, 1850 – 1966” in its drivers on a passenger); Solis v. Workers’ Compensation
A.W.R. Carrothers, Report of a Study on the Labour Injunc- Board (Millard Health), 2015 ABCA 227 (employer not
tion in Ontario (Toronto: Ontario Department of Labour, liable for fraudulent behaviour of employee); and Plains
1966) at 603-84; B. Laskin, “Picketing: A Comparison of Engineering Ltd. v. Barnes Security Services Ltd., 1987
Certain Canadian and American Doctrines” (1937) 15 CanLII 3222 (Alta. QB).
Can Bar Rev 10; and I.M. Christie, The Liability of Strikers 10. See, for example, Jacobi v. Griffiths, [1999] 2 SCR 570
in the Law of Tort (Kingston, Ont.: Queen’s University (sexual assault by an employee of a kids’ club that took
Industrial Relations Centre, 1967) at 55. For a classic place outside of work time and was beyond the control of
example of the courts’ creative use of tort law to restrain the employer). See also S. Wildeman, “Vicarious Liability
collective worker action, see Hersees of Woodstock Ltd. v. for Sexual Assault: The Two New Tests for Scope of
Goldstein et al., 1963 CanLII 151 (Ont. CA) (secondary Employment in B.(P.A.) v. Curry and T.(G.) v. Griffiths”
picketing of a third-party company is “illegal per se”). 1998 7 Dal J Legal Stud 1.
2. V. Beringham & C. Brennan, Tort Law (Oxford: Oxford 11. All three elements must be made out by the plaintiff: Mer-
University Press, 2010) at 2. rifield v. Canada (Attorney General), 2019 ONCA 205 (em-
3. D. Shuman, “The Psychology of Compensation in Tort ployer behaviour not flagrant and outrageous); and
Law” (1994) 43 Kan L Rev 39. See Correia v. Canac Kitch- Colistro v. Tbaytel, 2019 ONCA 197 (there was no desire to
ens, 2008 ONCA 506 at para 107 (intentional torts were produce the kind of harm produced).
created to allow a victim of the harmful acts of another to 12. Wilkinson v. Downton, [1897] 2 QB 57.
recover damages when no other legal action exists).
13. Strudwick v. Applied Consumer & Clinical Evaluations Inc.,
4. P.S. Atiyah, Vicarious Liability in the Law of Torts (London: 2016 ONCA 520 (harassment of an employee who is
Butterworths, 1967). A government can be liable for a con- deaf); Boucher v. Wal-Mart Canada Corp., 2014
tractor’s negligence where a statute delegates responsibility ONCA 419; Piresferreira v. Ayotte, 2010 ONCA 384; Prinzo
for maintaining public safety on a government office: see v. Baycrest Centre for Geriatric Care, 2002 CanLII 45005
Lewis (Guardian ad litem of) v. British Columbia, [1997] 3 (Ont. CA) at para 61; Boothman v. Canada, supra note 8
SCR 1145 (government ministry liable for the negligence (supervisor verbally harassed an employee who he knew
of a contractor retained to protect a highway from falling was emotionally fragile); Bogden v. Purolator Courier Ltd.,
rocks when a rock fell and killed a driver). 1996 CanLII 10572 (Alta. QB) (harassment of a worker
5. 671122 Ontario Ltd. v. Sagaz Industries Canada Inc., 2001 resulted in an order of $20,000 for intentional infliction of
SCC 59; Ivic v. Lakovic, 2017 ONCA 446 at para 9; and mental suffering); Rahemtulla v. Vanfed Credit Union, 1984
Heikkila v. Apex Land Corporation, 2016 ABCA 126. See CanLII 689 (BCSC); and Clark v. Canada, [1994] 3
also R. Flannigan, “Enterprise Control: The Servant- FC 323.
Independent Contractor Distinction” (1987) 37 UTLJ 25. 14. Boucher v. Wal-Mart, supra note 13
6. Bazley v. Curry, [1999] 2 SCR 534 at para 31; and 671122 15. Piresferreira v. Ayotte, supra note 13. See also Tannous v.
Ontario Ltd. v. Sagaz Industries Canada Inc., supra note 5. Donaghue, 1998 CanLII 4627 (Ont. CA) (aggravated
7. Cecilio v. Turnberry Green Homes Inc., 2010 ONSC 7077 damages of $15,000); and Mainland Sawmills Ltd. et al v.
(negligent installation of a kitchen island by an employee); IWA – Canada et al., 2006 BCSC 1195.
and Collings v. Jew, 2009 ONCA 18 (a car accident by an 16. Tran v. University of Western Ontario, 2015 ONCA 295 at
employee who was in Toronto for a business meeting). para 23; and Central Canada Potash Co. Ltd. et al. v. Gov-
8. See also Boothman v. Canada, [1993] 3 FC 381; and ernment of Saskatchewan, [1979] 1 SCR 42 (the unlawful
Cimpean v. Payton, 2008 CanLII 32808 (Ont. Sup Ct J) means threatened by a party may include a tort or criminal
(professional basketball team can be vicariously liable for offence and, possibly, a breach of contract). In the
torts committed by players during personal time when the British decision of Rookes v. Barnard, [1964] AC 1129,
employment contract includes rules about off-duty the House of Lords ruled that a threat to breach a con-
behaviour). tract satisfies the unlawful means element of the tort. See
9. See, for example, Inform Cycle Ltd. v. Rebound Inc., 2007 also Morgan v. Fry et al., [1968] 3 All ER 452 (CA).
ABQB 319 (employer not vicariously liable for a tort com- However, a threat to quit unless some action is taken is not
mitted by an employee who secretly used the employer’s intimidation, since quitting with proper notice is not
Internet connection to create a domain name later used in unlawful: Roehl v. Houlahan (C.A.), 1990 CanLII 6781
commission of a tort); Ivic v. Lakovic, supra note 5 (taxi (Ont. CA).

17. Rookes v. Barnard, supra note 16. Division No. 4 et al., 1989 CanLII 4616 (Sask. QB); and
18. Yu-Ming Sui v. Westcoast Transmission Co. Ltd., 1984 Rudd v. Hamiota Feedlot Ltd., 2006 MBQB 22 at para 26:
CanLII 497 (BCSC). “That an employer owes a duty of care to their employees
is well established law.”
19. Grant v. Torstar Corp., 2009 SCC 61.
32. See the discussions in Douglas v. Kinger, 2008 ONCA 452;
20. Ibid. at paras 32-33; Mann v. International Association of
Portage LaPrairie Mutual Insurance Company v. MacLean,
Machinists and Aerospace Workers, 2012 BCSC 181 at para
2012 NSSC 341; and Shamac Country Inns Ltd. v. Sandy’s
73; Canuck Security Services Ltd. v. Gill, 2013 BCSC 893;
Oilfield Hauling Ltd., 2015 ABQB 518.
and Meszaros v. Hendry, Swinton, McKenzie Insurance Ser-
vices (Westshore) Inc., 2015 BCSC 1423 (statements sub- 33. Douglas v. Kinger, supra note 32 at para 61.
stantially true). 34. Ibid. at 59.
21. Mejia v. LaSalle College International Vancouver Inc., 2014 35. Ibid. See also Viktoria Granite and Marble Ltd. v. Franczuk,
BCSC 1559. 2010 SKPC 166.
22. Hawley v. Webb, 2002 BCSC 244. 36. London Drugs Ltd. v. Kuehne & Nagel International Ltd.,
23. Franchuk v. Schick, 2014 ABQB 249. [1992] 3 SCR 299 (employees were negligent in handling
the customer’s transformer).
24. Mejia v. LaSalle College International Vancouver Inc., supra
note 21. See also Meszaros v. Hendry, Swinton, McKenzie 37. See the extensive discussion of professional negligence in
Insurance Services (Westshore) Inc., supra note 20. Linden, Klar, & Feldthusen, supra note 28 at 217-44.
25. Lumley v. Gye (1853), 2 E & B 216; Drouillard v. Cogeco 38. G.H.L. Fridman, The Law of Torts in Canada, 2nd ed
Cable Inc., 2007 ONCA 322; and Correia v. Canac Kitch- (Toronto: Carswell, 2002) at 603.
ens, supra note 3 (there was no intention to cause a 39. On medical negligence, see Wilson v. Swanson, [1956] SCR
breach). 804 at 817: “the medical man must possess and use that
26. “Inducing breach of contract” was first developed in the reasonable degree of learning and skill ordinarily pos-
case of Lumley v. Gye, supra note 25, and later applied sessed by practitioners in similar communities in similar
against union organizers: South Wales Miners’ Federation v. cases, and it is the duty of a specialist such as appellant,
Glamorgan Coal Co. Ltd., [1905] AC 239; Quinn v. who holds himself out as possessing special skill and
Leathem, [1901] AC 495; and D.C. Thomson & Co. Ltd. v. knowledge, to have and exercise the degree of skill of an
Deakin and others, [1952] 2 All E.R. 361 (C.A.). See dis- average specialist in his field.” On legal negligence, see
cussion of the current application of the law to labour Central Trust Co. v. Rafuse, [1986] 2 SCR 147 at para 58:
picketing in Prince Rupert Grain Ltd. v. Grain Workers’ the reasonably competent solicitor, the ordinary compe-
Union, Local 333, 2002 BCCA 641. tent solicitor, and the ordinary prudent solicitor.
27. Mustapha v. Culligan of Canada Ltd., 2008 SCC 27. 40. See the discussion of the early application of employer
28. For greater detail, read any number of excellent tort texts negligence in workplace safety cases in T. Ison, “A Histor-
available in Canada: A. Linden, L. Klar, & B. Feldthusen, ical Perspective on Contemporary Challenges in Workers’
Canadian Tort Law, 13th ed (Markham, ON: LexisNexis, Compensation” (1996) 34 Osgoode Hall LJ 807; and E.
2009); and E.J. Weinrib, Tort Law: Cases and Materials, 4th Tucker, “The Law of Employer’s Liability in Ontario
ed (Toronto: Emond Montgomery, 2014). 1861 – 1900: The Search for a Theory” (1984) 22 Osgoode
Hall LJ 251. Cases in which employers were found negli-
29. See Jenkins v. Muir, 2012 ABQB 352 (an employer is not
gent for harm caused to workers due to unsafe working
vicariously liable when the negligence of an employee on
conditions include Badcock v. Freeman (1894), 21 OAR
her drive home from work caused injury to a third party,
633; Wilson v. Boulter (1898), 26 OAR 184; and Rudd v.
since the employer owed no duty of care to that third
Hamiota Feedlot Ltd., supra note 31.
party).
41. See, for example, the Ontario Workmen’s Compensation
30. The leading case on the test for whether a duty of care
Act, SO 1914, 4 Geo V., c. 25; and the British Columbia
arises is Anns v. Merton London Borough Council, [1978]
Workmen’s Compensation Act, SBC 1916, c. 77.
AC 728, affirmed by the Supreme Court of Canada in
Kamloops v. Nielsen, [1984] 2 SCR 2 along with the classic 42. The Alberta Workers’ Compensation Act, RSA 2000,
decision read by every law student: Donoghue v. Stevenson, c. W-15, s. 21(2). See also the Manitoba Workers Compen-
[1932] AC 562 (HL). sation Act, CCSM c. W200, s. 13(1); and the Ontario
31. See, for example, Christie v. London Electric Co., 1915 Workplace Safety and Insurance Act, 1997, SO 1997, c. 16,
CanLII 527 (Ont. CA); Lanteigne v. Vienneau, 1999 CanLII Sched. A, ss. 13(1) and 28. Similar provisions are found in
14719 (NBCA); Fox v. Board of Education of Regina School the other provinces’ workers’ compensation legislation. A
large volume of case law considers whether workers were

injured “in the course of employment.” Workers’ compen- know or foresee her impairment). See also John v. Flynn,
sation legislation also excludes benefits for some harms 2001 CanLII 2985 (Ont. CA).
occurring at work, so lawsuits can move forward on those 45. Wilson v. Clarica Life Insurance Co., 2002 BCCA 502.
harms. For example, s. 13(4) of the Ontario Workplace
46. Queen v. Cognos Inc., [1993] 1 SCR 87. See also Treaty
Safety and Insurance Act excludes damages for mental
Group Inc. v. Drake International Inc., 2005 CanLII 45406
stress in most cases, enabling an employee to sue for
(Ont. Sup Ct J) (placement agency committed negligent
mental stress under the common law. See, for example, De-
misrepresentation in referring a convicted thief to a
cision No. 962/14, 2014 ONWSIAT 1175.
client).
43. See also Street v. Ontario Racing Commission, 2008 ONCA
47. Linden, Klar, & Feldthusen, supra note 28 at 713.
10 (employee could sue the employer for negligence when
the employer failed to take out the required workers’ com- 48. Piresferreira v. Ayotte, supra note 13; Mustapha v. Culligan
pensation premiums to cover the employee for injuries at of Canada Ltd., supra note 27.
work); Dyck v. Lohrer, 2000 BCCA 219 (plaintiff who was 49. See Bettel et al. v. Yim, 1978 CanLII 1580 (Ont. Sup Ct J);
injured in a car crash when the car was driven by an em- and Non-Marine Underwriters, Lloyd’s of London v. Scalera,
ployee can sue the non-employer owner of the car for 2000 SCC 24 at 99. See also the discussion in Linden, Klar,
vicarious liability for the actions of the driver). & Feldthusen, supra note 28 at 63-67.
44. Jacobsen v. Nike Canada Ltd., 1996 CanLII 3429 (BCSC). 50. Piresferreira v. Ayotte, supra note 13 at para 75.
Contrast Jenkins v. Muir, supra note 29 (employer not neg- 51. See Hill v. Church of Scientology of Toronto, [1995] 2 SCR
ligent when employee drank at work and then was killed 1130 at para 196. See also Whiten v. Pilot Insurance Co.,
in a car crash since the employer’s representatives were not [2002] 1 SCR 595.
aware of the employee’s impairment and had no reason to
52. See Boucher v. Wal-Mart, supra note 13.


Selected Cases: Part II
671122 Ontario Ltd. v. Sagaz Industries Canada Inc., 2001 SCC 59 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 261
Antonacci v. Great Atlantic & Pacific Co. of Canada, 1998 CanLII 14734 (Ont. Sup Ct J) . . 175, 176, 198, 233
Babcock v. C. & R. Weickert Enterprises Ltd., 1993 CanLII 3112 (NSCA) . . . . . . . . . . . . . . . . . . . . . . . 187, 197
Balzer v. Federated Co-operatives Limited, 2018 SKCA 93 �� 187, 197
Bannister v. General Motors of Canada Ltd., 1998 CanLII 7151 (Ont. CA)�� 150, 151, 197, 198
Bardal v. Globe & Mail Ltd.,
1960 CanLII 294 (Ont. Sup Ct J) . . . . . . . . . . 122, 159, 160, 163, 164, 165, 166, 167, 219, 221, 222, 240, 241
Bazley v. Curry, [1999] 2 SCR 534 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 249, 258, 260, 261
Berg v. Cowie, 1918 CanLII 319 (Sask. CA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 151
Bohemier v. Storwal International Inc., 1983 CanLII 1956 (Ont. CA) . . . . . . . . . . . . . . . . . . . . . . . 164, 165, 168
Boucher v. Wal-Mart Canada Corp., 2014 ONCA 419 . . . . . . . . . . . . . . 151, 216, 224, 225, 233, 250, 261, 263
Bowes v. Goss Power Products Ltd., 2012 ONCA 425 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 131, 167, 234
Braiden v. La-Z-Boy, 2008 ONCA 464 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 111, 167
Carscallen v. FRI Corp., 2005 CanLII 20815 (Ont. Sup Ct J);
aff ’d 2006 CanLII 31723 (Ont. CA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 144, 149, 151, 210, 216
Carter v. Bell & Sons (Canada) Ltd., 1936 CanLII 75 (Ont. CA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 157, 167
Ceccol v. Ontario Gymnastic Federation, 2001 CanLII 8589 (Ont. CA) . . . . . . . . . . . . . 120, 125, 129, 130, 164
Chambly (City) v. Gagnon, [1999] 1 SCR 8 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 130
Chevalier v. Active Tire & Auto Centre Inc., 2013 ONCA 548 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 215, 228, 235
Clark v. Coopers & Lybrand Consulting Group, 2002 CanLII 45050 (Ont. CA) . . . . . . . . . . . . . . . . . . . . . . 92, 95
Colistro v. Tbaytel, 2019 ONCA 197 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 151, 203, 214, 216, 224, 233, 261
Colwell v. Cornerstone Properties Inc., 2008 CanLII 66139 (Ont. Sup Ct J) . . . . . . . . . . . . . . . . . . . . . . . 216, 235
Consbec Inc. v. Walker, 2016 BCCA 114 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 150, 242, 245
Cronk v. Canadian General Insurance Co., 1995 CanLII 814 (Ont. CA) . . . . . . . . . . . . 161, 162, 163, 167, 168
Davies v. Fraser Collection Services Ltd., 2008 BCSC 942 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 151, 235
Di Tomaso v. Crown Metal Packaging Canada LP, 2011 ONCA 469 . . . . . . . . . . . . . . . . . . . 162, 163, 167, 168
Ditchburn v. Landis & Gyr Powers, Ltd., 1997 CanLII 1500 (Ont. CA) . . . . . . . . . . . . . . . . . . . . . 150, 198, 199
Drouillard v. Cogeco Cable Inc., 2007 ONCA 322 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 254, 262
Dykes v. Saan Stores Ltd., 2002 MBQB 112 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 149, 207, 215
Evans v. Teamsters Local Union No. 31, 2008 SCC 20 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 228, 229, 230, 234, 235
Farber v. Royal Trust Company, [1997] 1 SCR 846 . . . . . . . . . . . . . . . . . . 149, 204, 205, 206, 208, 213, 214, 215
Farquhar v. Butler Brothers Supplies Ltd., 1988 CanLII 185 (BCCA) �� 214, 216
Foreman v. 818329 Ontario Limited, 2003 CanLII 57401 (Ont. CA) �� 129, 130, 131
Francis v. Canadian Imperial Bank of Commerce, 1994 CanLII 1578 (Ont. CA)�� 105, 106, 111
General Billposting Co. Ltd. v. Atkinson, [1909] AC 118 (HL)�� 130
Gillies v. Goldman Sachs Canada Inc., 2001 BCCA 683 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 221
Globex Foreign Exchange Corporation v. Kelcher, 2011 ABCA 240 . . . . . . . . . . . . . . . . . . . . . 106, 111, 129, 130
Greenberg v. Meffert, 1985 CanLII 1975 (Ont. CA)�� 129
Gunton v. Richmond-upon-Thames London Borough Council, [1981] 1 Ch. 488 (CA) . . . . . . . . . . . . . 216, 231
Hadley v. Baxendale, [1854] 156 ER 145 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 220, 231
Haldane v. Shelbar Enterprises Limited, 1999 CanLII 9248 (Ont. CA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 216
Hanni v. Western Road Rail Systems, 2002 BCSC 402 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 151, 216
265

Hedley Byrne & Co. v. Heller & Partners, [1964] AC 465 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90, 91, 95
Henry v. Foxco Ltd., 2004 NBCA 22 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 189, 195, 197, 198
Hersees of Woodstock Ltd. v. Goldstein et al., 1963 CanLII 151 (Ont. CA) . . . . . . . . . . . . . . . . . . . . . . . . . . . 261
Hill v. C.A. Parsons and Co. Ltd., [1972] Ch. 305 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 231
Hill v. Peter Gorman Ltd., 1957 CanLII 393 (Ont. CA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107, 111, 211, 216
Hivac, Ltd. v. Park Royal Scientific Instruments, [1946] 1 All ER 350 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 149, 150
Hobbs v. TDI Canada Ltd., 2004 CanLII 44783(Ont. CA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 106, 111, 232
Honda Canada Inc. v. Keays, 2008 SCC 39 . . . . . . . . . . . . . . . . . . . . 145, 151, 197, 220, 222, 223, 231, 232, 233
Howard v. Benson Group Inc., 2016 ONCA 256 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 121, 130, 234
Islip v. Coldmatic Refrigeration of Canada Ltd., 2002 BCCA 255 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
James Totterdale Case (1850) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
Johnson v. Global Television Network Inc. (CH Vancouver Island), 2008 BCCA 33 . . . . . . . . . . . . . . . . 147, 231
Kelly v. Linamar Corporation, 2005 CanLII 42487 (Ont. Sup Ct J) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 191, 199
Kohler Canada v. Porter, 2002 CanLII 49614 (Ont. Sup Ct J) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 111, 129, 152
Laws v. London Chronicle (Indicator Newspapers) Ltd., [1959] 2 All ER 285 (CA) . . . . . . . . 138, 149, 195, 197
Lloyd v. Imperial Parking Ltd., 1996 CanLII 10543 (Alta. QB) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 143, 211, 216
Lyons v. Multari, 2000 CanLII 16851 (Ont. CA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 118, 129
Machtinger v. HOJ Industries Ltd., [1992] 1 SCR 986 . . . . . . . . . . . . . . . . 122, 123, 130, 149, 155, 156, 167, 232
McKinley v. BC Tel, 2001 SCC 38 . . . . . . . . . . . . 150, 180, 181, 182, 185, 186, 187, 188, 190, 194, 195, 196, 197
Medis Health and Pharmaceutical Services Inc. v. Bramble, 1999 CanLII 13124 (NBCA) . . . . . . . . . . . . . . 167
Michela v. St. Thomas of Villanova Catholic School, 2015 ONCA 801 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 164, 168
Mifsud v. MacMillan Bathurst Inc., 1989 CanLII 260 (Ont. CA) . . . . . . . . . . . . . . . . . . . . . . . . . . . 149, 215, 235
Minott v. O’Shanter Development Company Ltd., 1999 CanLII 3686 (Ont. CA) . . . . 161, 162, 163, 167, 168, 198
Morgan v. Chukal Enterprises, 2000 BCSC 1163 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 151, 216
Piresferreira v. Ayotte, 2010 ONCA 384 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 251, 258, 261, 263
Prinzo v. Baycrest Centre for Geriatric Care, 2002 CanLII 45005 (Ont. CA) . . . . . . . . . . . . . 233, 250, 251, 261
Queen v. Cognos Inc., [1993] 1 SCR 87 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90, 91, 93, 94, 95, 258, 263
R v. Arthurs, Ex p. Port Arthur Shipbuilding Co., 1967 CanLII 30 (Ont. CA) . . . . . . . . . . . . . . . . 150, 180, 195
R v. Barton-Upon-Irwell, [1814] 2 M. & S. 328 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
Rahemtulla v. Vanfed Credit Union, 1984 CanLII 689 (BCSC) . . . . . . . . . . . . . . . . . . . . 146, 147, 151, 152, 261
RBC Dominion Securities Inc. v. Merrill Lynch Canada Inc., 2008 SCC 54 . . . 140, 141, 149, 150, 231, 241, 245
Rejdak v. Fight Network Inc., 2008 CanLII 37909 (Ont. Sup Ct J) . . . . . . . . . . . . . . . . . . . . . . . . . . 104, 105, 133
Rubel Bronze & Metal Co. v. Vos, [1918] 1 KB 315 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 214
Rudd v. Hamiota Feedlot Ltd., 2006 MBQB 22 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 257, 262
Russo v. Kerr, 2010 ONSC 6053 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 111, 216, 229
Sarmiento v. Wilding & Rampage Entertainment, 2008 BCPC 232 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100
Secretary of State for Employment v. ASLEF (No. 2), [1972] 2 All ER 949 (CA) . . . . . . . . . . . . . . . . . . . . . . . 150
Seneca College v. Bhadauria, [1981] 2 SCR 181 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88, 89, 233
Shah v. Xerox Canada Ltd., 2000 CanLII 2317 (Ont. CA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 203, 214, 216
Shirlaw v. Southern Foundries (1926), Ltd., [1939] 2 KB 206 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 149
Simpson v. Consumers’ Assn. of Canada, 2001 CanLII 23994 (Ont. CA) . . . . . . . . . . . . . . . . . . . . . . . . . 151, 198
Spain v. Arnott, [1817] 171 ER 638 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75, 82
Speakman v. City of Calgary (1908), 9 WLR 264 (Alta. CA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 156, 161, 167
Stamos v. Annuity Research & Marketing Service Ltd., 2002 CanLII 49618 (Ont. Sup Ct J) . . . . . . . . . 151, 216
Stein v. British Columbia Housing Management
Commission, 1992 CanLII 4032 (BCCA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 138, 149, 195, 197, 215
Stephenson v. Hilti (Canada) Ltd., 1989 CanLII 191 (NSSC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 124, 131
Stilk v. Myrick (1809), 170 ER 1168 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102, 103

Sylvester v. British Columbia, [1997] 2 SCR 315 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 176, 198, 231

Techform Products Ltd. v. Wolda, 2001 CanLII 8604 (Ont. CA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107, 111
Toronto Marlboro Major Junior “A” Hockey Club v. Tonelli, 1979 CanLII 1969 (Ont. CA) . . . . . . . . . 98, 99, 110
Tree Savers International Ltd. v. Savoy, 1992 CanLII 2828 (Alta. CA) . . . . . . . . . . . . . . . . . . 150, 241, 243, 245
Turner v. Mason, [1845] 153 ER 411 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
Upcott v. Savaria Concord Lifts Inc., 2009 CanLII 41348 (Ont. Sup Ct J) . . . . . . . . . . . . . . . . . . . . 238, 239, 245
van Woerkens v. Marriott Hotels of Canada Ltd., 2009 BCSC 73 . . . . . . . . . . . . . . . . . . . . . . . 189, 196, 198, 199
Vorvis v. Insurance Corporation of British Columbia, [1989] 1 SCR 1085 . . . . . . . . . . . . . . . . . . . . . 231, 232, 233
Wallace v. United Grain Growers Ltd.,
[1997] 3 SCR 701 . . . . . . . . . . . . . . . . . . . . . . . 145, 151, 156, 165, 168, 220, 222, 223, 224, 230, 231, 232, 233
Wightman Estate v. 2774046 Canada Inc., 2006 BCCA 424 . . . . . . . . . . . . . . . . . . . . . . . 173, 175, 176, 177, 198
Wilson v. Racher, [1974] IRLR 114 (CA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 149, 151, 195
Wronko v. Western Inventory Service Ltd., 2008 ONCA 327 . . . . . . . . . . . . . . . . . . . . . . . . . . 108, 111, 211, 216


Part III
The Regulatory Regime
CHAPTER 17 Introduction to the Regulatory Regime
Employment Protection Regulation

CHAPTER 18 Wage Regulation and Pay Equity
CHAPTER 19 Regulating Hours of Work, Time Off, and Overtime
CHAPTER 20 Regulating the End of Employment Contracts
CHAPTER 21 Introduction to Human Rights at Work
CHAPTER 22 The Two-Step Human Rights Model and the Prohibited Grounds of
Discrimination
CHAPTER 23 The Bona Fide Occupational Requirement, the Duty to
Accommodate, and Other Discrimination Defences
CHAPTER 24 Occupational Health and Safety and Workers’ Compensation
Broader Labour Market Regulation

CHAPTER 25 The Right to Work: Immigration and Mobility Law
CHAPTER 26 Privacy Law at Work
CHAPTER 27 Globalization and the Law of Work: International Labour Law and
Trade Law
Selected Cases: Part III
Online Supplemental Chapters*

Regulating Unemployment
Intellectual Property Law and Work
Pensions, Insolvencies, Bankruptcies, and the Worker
*For information on how to access these online supplemental chapters, see p. xxiii in the preface of
this book.


C H A P T E R 17
Introduction to the Regulatory

Regime
II. Jurisdiction: The Power to Regulate Work 273
• Describe how employment protection legislation is “mandatory” and “remedial”
III. The Process of Law Making: Statutes and
and therefore how it must be interpreted generously in favour of employees. Regulations 274
• Describe which levels of government have jurisdiction to regulate work and IV. Expert Administrative Tribunals 277
employment. V. What Regulatory Standards Are of Interest in the Law
• Describe the basic process through which statutes and regulations are enacted of Work? 279
in Canada. VI. Chapter Summary 281
• Define and explain the difference between legislation, statutes, and regulations. Questions and Issues for Discussion 281
Exercise 281
• Describe the role of expert administrative tribunals.
• Identify which types of legislation fall within the scope of the law of work.
I. Introduction
Over the decades, politicians have looked out of their office windows at the world that results
when individual workers are left to bargain their own working conditions with employers. They
have frequently disliked what they saw. They saw employers exploit their superior bargaining
power to impose unacceptably poor working conditions on workers, including very low wages,
long working hours, and extremely dangerous workplaces. They saw young children employed
in dingy and loud sweatshops. They saw wage grids that determined workers’ pay on the basis
of gender, skin colour, or religion. As public opposition to these practices grew, politicians
responded by passing regulatory standards legislation to protect workers, who were perceived
to lack the bargaining power necessary to protect themselves.
The central premise underlying most employment regulation is that the common law regime
explored in Part II frequently produces unacceptably poor working conditions. Regulatory
standards are the mechanism through which governments inject public policy into labour mar-
kets when they perceive that market forces alone are producing unacceptable outcomes. The
work relationship has been the subject of extensive regulatory intervention for centuries, as
described by Professor David Beatty:
As any history of work relations will show, every community, acting in its own self-interest, has
subjected this activity to extensive social regulation. Given its importance to the vitality of the indi-
vidual and the community alike, work has always been one of the most intensely regulated of human
activities. Whenever a society, or more accurately its rule-makers, has perceived that the individual
or the social order was threatened by the patterns and processes of work, it has consistently acted to
preserve what it thought was in its most vital interest.1
271

272 Part III The Regulatory Regime
More recently, Professor Harry Arthurs described the function of regulatory standards as
follows:
In their inception in the United Kingdom, early in the Industrial Revolution, labour standards
reflected widespread public sentiment, given force by legislation, that no employer should be allowed
to impose, and no worker should be obliged to endure, working conditions that fell below the stan-
dard that a decent society would tolerate.2
According to Arthurs, the objective of the regulatory standards regime is to “ensure that no
matter how limited his or her bargaining power, no worker … is offered, accepts or works under
conditions that Canadians would not regard as ‘decent.’”3 Whether regulatory standards actually
do encourage or produce “decent” working conditions is a matter of ongoing debate and a cen-
tral defining issue in the study of the law of work. Even among those who agree on the need for
legislation to protect workers, a wide range of opinions exist on what form that legislation
should take.
Regulatory standards laws function by imposing mandatory rules on contracting parties. In
other words, they restrict freedom of contract. As a general principle—there are some excep-
tions we will consider in future chapters—employers, employees, and unions cannot contract
out of or waive the rights and responsibilities imposed by employment protection legislation.4
A contract term that violates human rights legislation is illegal and unenforceable, even if the
employee agreed to it. An employee cannot agree to waive their right to a safe workplace, which
they are entitled to under occupational health and safety legislation. Similarly, if an employer
pays an employee less than the minimum wage established in employment standards legislation,
then the employer is violating the statute, even if the employee agreed to that wage. In the case
of employment standards legislation, the parties can agree to contract terms that provide
employees with greater entitlements or a greater benefit than what is required by the legislation,
but they cannot agree to lessor entitlements.5
The minimum wage is a well-known example of a mandatory floor: it says to employers and
employees that they cannot agree to a wage rate less than the statutory minimum and that any
attempt to do so is illegal, although they can agree to a wage rate that is higher than the min-
imum wage. An example of a mandatory ceiling is the maximum hours of work rules found in
employment standards legislation. Some regulatory standards laws, such as human rights legis-
lation, restrict employer discretion by prohibiting decisions based on the personal characteris-
tics or actions of workers. Others impose positive obligations on parties to take certain steps,
such as the requirements in health and safety legislation to ensure safe workplaces. Still others
provide a safety net for workers who find themselves without work, such as unemployment
insurance and workers’ compensation legislation.
The Supreme Court of Canada has ruled that because employment protection legislation is
“remedial” and intended to protect vulnerable workers, it must be interpreted “broadly” and
“generously” in favour of employees. In practice, this tends to mean that (1) where there are
multiple possible interpretations of legislation, the one most favourable to the person claiming
entitlement based on the legislation should be favoured; and (2) exemptions from protective
legislation should be interpreted narrowly so that the greatest number of people are covered by
the legislation.6 As we work our way through Part III, we will keep an eye out for how this rule
of interpretation effects the scope and application of employment legislation.
mandatory floor: A law that establishes a mandatory minimum condition that can be included in a contract; for example,
a minimum wage law.
mandatory ceiling: A law that establishes a mandatory maximum condition that can be included in a contract; for example,
a law that fixes the maximum number of hours an employee can work in a day or week.

Chapter 17 Introduction to the Regulatory Regime 273
The employment relationship is among the most regulated in society. Statutes and regulations
govern virtually every aspect of this relationship, from the hiring stage, through the life of the
employment relationship, right to the end of the relationship (and sometimes beyond!). Part III
explores many (although certainly not all) of these laws, as well as some of the central debates
that have shaped their development. This chapter introduces some key concepts and processes
that we need to understand before we proceed further in our discussion of the regulatory stan-
dards regime.
II. Jurisdiction: The Power to Regulate Work

The Constitution Act, 1867 divides the jurisdiction to legislate between the federal government
and the provincial governments. The federal government cannot regulate or apply its laws to a
business, contract, or activity that falls outside of its jurisdiction, and the same is true for prov-
incial governments. If an act of government is found to have been outside of its jurisdiction, that
act is said to be ultra vires (Latin for “beyond the powers”) and is void. Understanding which
level of government has authority to regulate employment is crucial in the law of work. We need
to know whether the provincially or federally enacted laws apply, since the legal rules and the
processes for enforcing those rules can be very different.
Section 91 of the Constitution grants the federal government jurisdiction over a variety of
subject matters and industries, including the following, which are particularly relevant to the
law of work:
• the regulation of trade and commerce (s. 91(2));

• unemployment insurance (s. 91(2A));
• postal service (s. 91(5));
• militia, military and naval service, and defence (s. 91(7));
• navigation and shipping (s. 91(10));
• banking, incorporation of banks, and the issue of paper money (s. 91(15));
• bankruptcy and insolvency (s. 91(21)); and
• the criminal law (s. 91(27)).7
Section 91 also grants the federal government jurisdiction to make laws “for the Peace, Order,
and good Government of Canada” (known as the “POGG power”). The courts have applied this
general POGG power to grant the federal government jurisdiction over the aeronautics (air-
lines) industry.8 This means, for example, that employees of Air Canada and WestJet are gov-
erned by employment legislation enacted in Ottawa by the federal government and not by
provincial employment legislation.
Section 92 of the Constitution sets out the jurisdiction of the provinces, including the follow-
ing, which are particularly relevant to the law of work:
• local works and undertakings that do not extend beyond provincial borders (s. 92(10));
• property and civil rights in the province (s. 92(13)); and
• generally all matters of a merely local or private nature in the province (s. 92(16)).9
Section 92(10) grants authority over “Local Works and Undertakings” to provinces, but busi-
nesses that regularly cross provincial or national borders fall within federal jurisdiction. For
example, interprovincial railway, bus, and trucking companies, as well as communications
jurisdiction: The scope of authority over which a government, court, or expert administrative power has the power to govern.
ultra vires: Beyond one’s jurisdictional powers.

(radio, television, phone) companies that operate in multiple provinces, are legislated by the
federal government. Some interesting cases have involved transportation companies that oper-
ate almost exclusively within one province but occasionally do business that takes employees
across provincial borders. The courts and expert administrative tribunals have ruled that such
companies fall within federal jurisdiction if the cross-border work is “regular and continuous,”
even if it amounts to only a very small percentage of the companies’ overall activity.10
Until 1925, confusion existed over whether the federal or the provincial governments had
general authority over the regulation of employment and collective bargaining in those indus-
tries that are not specifically assigned to federal jurisdiction by section 91. That year, in the case
of Toronto Electric Commissioners v. Snider, it was ruled that this authority fell under “property
and civil rights in the province,” a power granted to the provinces in section 92.11
As a result of the Snider decision, since 1925 the principal jurisdiction in Canada over laws
that govern employment rests with the provinces. Approximately 92 percent of Canadian work-
ers are subject to provincial regulatory standards legislation.12 Canada’s regulatory standards
regime is fragmented, since each province (and the three territories) enacts its own legislation
governing employment.
The remaining 8 percent of Canadian workers are employed in jobs that fall within federal
jurisdiction. These workers belong to one of the following three categories:
1. They are employees of the federal government.

2. They are employed by an employer that operates in an industry that is specifically
assigned to federal jurisdiction by the Constitution, such as Canada Post, the chartered
banks, airlines, and national telecommunications companies.
3. They are employed by a company whose ordinary business is to provide a “vital” or
“integral” service to a federally regulated business.
Some interesting cases have explored the third category of federally regulated employees.13
For example, the Empress Hotel in Victoria was owned and operated by the Canadian Pacific
Railway, a federally regulated national railway company, but was ruled to be governed by prov-
incial employment standards laws because the operation of the hotel was not considered vital to
the operation of the railway.14 But a company in Toronto that provided stevedoring services (the
loading and unloading of ships) to a federally regulated shipping company was subject to federal
employment laws because stevedoring is vital and integral to the operation of the shipping
company.15
The sheer volume of employment-related legislation at both provincial and federal levels is
daunting. It would be impossible to delve too deeply into the nuts and bolts of every statute.
Instead, we will examine the regulatory standards regime with an issue-based focus. Although
the details of employment legislation in different parts of Canada vary (for the most part), all
provincial governments seek to respond to the same pressing labour market issues. In our exam-
ination, we will consider both provincial and federal laws, emphasizing common strategies and
noting interesting differences in legislative approaches.
III. The Process of Law Making: Statutes and Regulations

When we introduced the law of work framework in Chapter 2, we noted that governments play
two roles within the framework. First, they act as employers within the work law subsystem. In
this capacity, they negotiate employment contracts and collective agreements, adopt human
resource policies, and hire and fire workers, just as non-government employers do. Second,
governments are lawmakers: they debate, enact, and enforce the laws of Canada. In Part III, we
are mostly concerned with governments’ law-making role.

The law-making process is complex, but we can summarize it relatively succinctly for our
purposes.16 An elected government is given authority by the Constitution of Canada to enact
laws to govern areas that fall within the government’s jurisdiction. A new law begins with the
introduction of a bill in Parliament, which is a draft proposal of a law. Ministers of the govern-
ment introduce most bills that become law (government bills). A minister is an elected politi-
cian17 who belongs to the political party that won the most seats in the previous election and
who has been designated to lead a ministry. Most laws that govern the employment relationship
begin as bills introduced by the Minister of Labour. Sometimes, a politician who is not a minis-
ter introduces a bill, which is known as a private member’s bill (the process for debating and
enacting a private member’s bill is slightly different from that described in the next
paragraph).
In 2019, the United We Roll convoy drove from Alberta to Ottawa to protest the federal government’s carbon
tax and urge support for pipeline construction.
Source: Canadian Press.
bill: A draft of a proposed law to introduce a new statute or to amend an existing one.
government bill: A bill introduced by a minister of the elected government.
private member’s bill: A bill introduced by an elected politician who is not a minister.

The bill then goes through a series of “readings.” At first reading, the bill is introduced in the
legislature. At second reading, the bill is debated by elected politicians and is sent to a committee
of elected politicians that can hear from witnesses about the bill and propose amendments to the
bill. At third reading, the elected politicians vote on whether to approve the final version of the
bill. If the vote passes, the final stage of the law-making process is known as royal assent. This
approval is a formality in which the English sovereign (the “Crown”) or their representative (the
governor general or lieutenant governor) gives formal consent to the bill passed by the legislature.
At the federal level, bills must also pass through three readings in the Senate before royal assent.
We are concerned with two primary types of government legislation: statutes and regula-
tions (sometimes called “subordinate legislation”). Statutes are bills that have been successfully
enacted by provincial legislatures or the federal Parliament. A statute may grant a right to create
regulations that fill in details of how the legislation will actually function and who it will (and
will not) cover. Usually, the statute will grant the power to create regulations to the lieutenant
governor in council, which in practice means that the elected government can make regulations
that are given to the lieutenant governor in council’s office for signature.
Imagine that we want to know if there is a minimum wage in British Columbia. We might
guess that the answer is most likely found in the British Columbia Employment Standards Act.
That Act creates a long list of legal rules that govern employment contracts in the province,
including section 16(1), which reads:
An employer must pay an employee at least the minimum wage as prescribed in the regulations.18
This section tells us that the province has a mandatory minimum wage, but it does not tell us
what that wage rate is. Near the end of the Act, we find the following provision:
127(1) the Lieutenant Governor in Council may make regulations … establishing minimum
wages for employees or classes of employees.19
To learn that rate, we must consult the regulations that have been enacted under (pursuant to)
the BC Employment Standards Act. Specifically, the regulation that contains this information is
the Employment Standards Regulation, BC Reg. 396/95. Sections 15 to 18 of this regulation pro-
vide minimum wage information. Excerpts of those sections are presented in Box 17.1 to dem-
onstrate the high level of detail often found in regulations.

Important Legal Details Are Often Found in Regulations
Many of the legal rules that governments use to regulate work exemptions from legal rules found in a statute or provide com-
are found in highly detailed regulations. Regulations can create plex details about how a general rule in a statute is to be
royal assent: A largely symbolic process through which the English sovereign (the “Crown”) or their representative formally
approves of a new law passed by a Canadian Parliament.
legislation: Laws enacted by governments, including both statutes and regulations.
statute: A law, or legislation, produced by a government that includes rules that regulate the conduct of business and people.
An example is the Ontario Employment Standards Act, 2000.
but does not say what that wage rate is. That Act gives the government the right to introduce regulations (in s. 141), and one

applied. The following excerpt from the BC Employment Stan-

(a) apples $21.06 a bin (27.1 cu. ft.);
dards Regulation is a good example of the kind of regulation
(b) apricots $24.23 a 1/2 bin (13.7 cu. ft.);
language used to define the substance and scope of a require-
(c) beans $0.289 a pound;
ment in a statute—in this case, the British Columbia Employ-
(d) blueberries $0.488 a pound;
ment Standards Act rule that employers pay “at least the
…
minimum wage.”*
Minimum wage—liquor servers
Part 4—Minimum Wages 18.1(1) In this section, “liquor server” means an
Minimum hourly wage employee
15. Subject to sections 16 to 18.1, the minimum (a) whose primary duties are as a server of
wage is $13.85 an hour. food or drink or both, and
(b) who, as a regular part of his or her employ-
Minimum daily wage ment, serves liquor directly to customers, guests,
16(1) The minimum daily wage for a live-in home members or patrons in premises for which a li-
support worker is $113.50 for each day or part day cence to sell liquor has been issued under the
worked. Liquor Control and Licensing Act.
(2) The minimum daily wage for a live-in camp (2) The minimum wage for a liquor server is
leader is $110.87 for each day or part day worked. $12.70 an hour.
Minimum wage—resident caretakers Other sections in this regulation detail the occupations
17. The minimum wage for a resident caretaker excluded from the Employment Standards Act, and thus from
is, the minimum wage law.† If we only read the requirement in
(a) for an apartment building containing 9 to the Act imposed on employers to pay a minimum wage, we
60 residential suites, $831.45 a month plus $33.32 would mistakenly conclude that all employees in British Col-
for each suite, and umbia are entitled to the minimum wage.
(b) for an apartment building containing 61
or more residential suites, $2,832.11. * BC Reg. 396/95 (as of July 2019).
Minimum wage—farm workers † See BC Reg. 396/95, s. 31 (Professions and Occupations Excluded from
the Act) and s. 32 (Employees Excluded from the Act). Also see ss. 33 to
18(1) The minimum wage, including 4% of gross
44, which detail the occupations excluded from parts of the Employment
earnings vacation pay, for farm workers who are Standards Act.
employed on a piece work basis and hand harvest
the following berry, fruit or vegetable crops, is, for
the gross volume or weight picked, as follows:
Regulations are important in the law of work. Governments like regulations because they can
be amended quickly and periodically without having to go through the complex, often adver-
sarial, and time-consuming process of passing a new bill to amend a statute. The main legal rule
may be described in a general way in a statute (“An employer must pay at least the minimum
wage as prescribed in the regulations”), and then detail is provided in the regulations. Whenever
a statute includes the words “as prescribed,” it is signalling that regulations exist that fill in the
detail associated with the legal rule. Both statutes and regulations can be found on government
websites as well as on CanLII. The exercise at the end of this chapter focuses on searching for
laws and associated regulations.
IV. Expert Administrative Tribunals

Government statutes (and regulations) are enforced and administered by an army of inspectors,
investigators, mediators, conciliators, expert administrative tribunals, and adjudicators
employed by the government. We will meet many of these people and institutions throughout
Parts III and IV. Sometimes, government inspectors proactively enforce laws by going out to
workplaces and demanding that employers demonstrate their legal compliance. However, that
is an expensive and time-consuming method of enforcement because of the large number of

businesses in Canada. As a result, the regulatory standards model is mostly a complaint-based

model; it depends on workers (and unions) or employers filing complaints alleging that a statute
or regulation has been violated. Statutes include a process enabling people to file complaints,
which initiates a government-led inquiry into whether the law has been violated.
That inquiry often includes attempts by government employees to resolve the dispute without
the need for expensive and time-consuming litigation. However, if the parties cannot resolve a
complaint voluntarily, it may end up before an expert administrative tribunal. Tribunals are
created by a statute for the purpose of administering and enforcing the legislation.20 The gov-
ernment may create a new tribunal or assign authority (or jurisdiction) over any statute to an
existing administrative tribunal. In Ontario, for example, the Ontario Labour Relations Board
has jurisdiction over a variety of statutes in addition to the Labour Relations Act, 1995, including
the Employment Standards Act, 2000 and the Occupational Health and Safety Act.
Tribunals are staffed by adjudicators who hear cases and write decisions, as well as mediators
and lawyers who give legal advice to the adjudicators. The government appoints one chair to
lead the adjudicative arm of the tribunal, along with a group of “vice-chairs” who conduct hear-
ings and write decisions interpreting and enforcing the legislation. Unlike judges in the court
system who are usually appointed for life, the chair and vice-chairs of tribunals are appointed
for a limited time period, usually three to five years, with the possibility of renewal at the discre-
tion of the government. The chair and vice-chairs are usually, though not always, lawyers with
expertise in the field. We will read about decisions of tribunals in the remainder of this text.
Governments create expert administrative tribunals for two principal reasons. The first reason
is to ensure that the people administering the legislation have expertise in the field. Many judges
lack expertise in employment-related matters because their backgrounds are in other areas of the
law. In addition, the objectivity and neutrality of judges have long been questioned by employees,
their advocates, and work law scholars, who have asserted that judges’ sentiments align more
closely with the interests of employers than workers.21 Expert administrative tribunals staffed by
professionals who have experience resolving employment-related disputes are expected to attract
a higher level of respect and the confidence of all the parties that come before them.
Bernard Fishbein (left), chair of the Ontario Labour Relations Board, leads a hearing.
Source: Steve Russell/GetStock.
complaint-based model: A statutory model that depends on people filing complaints alleging that their legal rights have
been violated, which initiates a government-led investigation into whether there has been a violation of the statute.
expert administrative tribunals: Decision-making bodies created by a government statute and given responsibility for
interpreting and enforcing one or more statutes and any regulations pursuant to that statute.

The second reason is to keep employment-related disputes from clogging up the courts. Dis-
putes relating to the dozens of statutes in Canada that regulate employment are diverted to tri-
bunals in the regulatory standards regime. The courts play a smaller role in the regulatory
standards regime than in the common law regime we considered in Part II. That role is mostly
to ensure that tribunals do not exceed the jurisdiction they have been granted by statute. The
courts perform this role through a legal process known as judicial review (introduced in Chap-
ter 1). A losing party before a tribunal can apply for judicial review of the tribunal’s decision and
ask the court to ensure that the tribunal did not act beyond its statutory authority. In practice,
most judicial review applications fail because courts grant tribunals a considerable amount of
“deference” because they are staffed by experts in the field.
V. What Regulatory Standards Are of Interest in the Law of Work?

Given the vast range of regulation that exists in Canada, how do we decide which laws are of
interest to us in a text on the law of work? We need to know where our subject begins and ends.
The law of work framework discussed in Chapter 2 recognizes the role of the state (government)
as a lawmaker in different legislative categories:
1. Protective standards regulation (Chapters 18 – 24; see also online supplemental chapter,
“Regulating Unemployment”). Governments enact regulatory standards legislation that
is primarily aimed at protecting employees, who are assumed to be vulnerable.
2. Broader labour market regulation (Chapters 25 – 27; see also online supplemental chap-
ters referenced on p. xxi in the preface of this book). Governments enact legislation that
is not primarily concerned with protecting employees, but that nevertheless substan-
tially impacts how labour markets operate in practice.
3. Collective bargaining legislation (Part IV, Chapters 28 – 38). Governments regulate the
processes of unionization, collective bargaining, and dispute resolution processes ap-
plicable to unionized workplaces.
We are obviously interested in regulation that is part of the government’s response to the
imbalance of bargaining power in the employment relationship and designed to protect vulner-
able employees (category one, protective regulatory standards, shown in orange in Figure 17.1).
The statutory outputs in this category are those most commonly associated with the law of work:
employment standards, occupational health and safety, workers’ compensation, employment
insurance, and human rights.
We are also interested in statutes in the broader legal subsystem that, while not primarily dir-
ected at protecting vulnerable employees, are nevertheless an important part of the story of how
governments regulate labour markets (category two, broader labour market regulation, which
is an output of the broader legal subsystem, shown in purple in Figure 17.1).22 Examples include
immigration laws that restrict who can work in Canada; intellectual property laws that define
who owns the product of work; insolvency laws that determine the rights of employees in rela-
tion to their struggling or defunct employers; pension laws; privacy laws; and trade laws that
affect employment investment decisions and bargaining strategies.23 Some scholars have
lumped the statutes in categories one and two together under the label “labour market
regulation.”24

FIGURE 17.1 The Boundaries of the Regulatory Regime

OUTPUTS
Power contracts

• • standards


Collective
• • Collective
Employers and Goals Collective bargaining, Judges/courts agreements
their associations strikes, and lockouts •
• • Torts/labour
Employees and Arbitration injunctions
their associations • •
Civil litigation Workplace norms
MARKET SUBSYSTEM Legal rules governing tax, trade SUBSYSTEM RELIGIOUS SUBSYSTEM ENVIRONMENTAL
Labour and other competition, immigration, Party politics, Social and cultural norms, SUBSYSTEM
EXTERNAL market forces at local, business associations, welfare, political values, religion, family, language, social Climate, access to
INPUTS regional, and global property, and constitutional law and political group dynamics, and identity natural resources,
levels (among other fields) systems politics (class, race, gender, etc.) geography
(Part III of the text,
Chapters 25-27, online
supplemental chapters)

We will explore the outputs of the first and second legislative categories in Part III and in
several online supplemental chapters (referenced on p. xxi in the preface of this book). The
outputs of the third legislative category will be examined in Part IV. Figure 17.1 depicts the
boundaries of the regulatory standards regime of interest to us in Part III, based on the law of
work framework.25
VI. Chapter Summary

In Part III of the text, we will explore the ways in which Canadian governments regulate work.
They do so to address perceived inadequacies in the outcomes produced by the common law
regime, which we explored in Part II of this text. This chapter provided an introduction to some
key foundational components or elements of the regulatory standards regime.

1. Why do governments enact employment legislation?
2. What is the difference between a statute and a regulation?
3. Describe the process through which a law is enacted in Canada.
4. What categories of employers are governed by protective employment legislation passed
by the federal government in Ottawa?
5. What type of legal body is authorized to interpret and enforce statutes and regulations in
Canada? What is the primarily role of courts in the regulatory regime?
APPLYING THE LAW

1. Would federal or provincial employment standards c. Mail delivery people employed by Canada Post
and human rights legislation apply to the following d. Employees of the Toronto Transit Commission (TTC)
workplaces? e. Employees of WestJet Airlines
a. Employees of a branch of Scotiabank in Saskatoon, f. Employees of an Ottawa-based bus company that
Saskatchewan has a small percentage of routes that regularly
b. Employees of a Starbucks store in Winnipeg, cross the provincial border into Quebec
Manitoba
EXERCISE
The Internet has made it much easier today than it was in the past to find and access government
regulations and statutes. In this short exercise, you are asked to locate a provincial employment
standards statute and the associated regulations enacted pursuant to it using CanLII.
2. Under “Primary Law,” select the province of your choice.
3. You will now see a list of links applicable to that province under the headings “Legislation,”
“Courts,” and “Boards and Tribunals.” Select either the link “Statutes” or the link to “Regu-
lations” under the heading “Legislation.”
4. You can search in one of two ways: in the search box, type “employment standards” or select
the letter E (for “employment standards”) and select the province’s employment standards
statute. (Note: For Quebec’s Act Respecting Labour Standards, look under the letter L, where
the statute is listed as Labour Standards, Act Respecting.)
5. Near the top of the employment standards statute webpage, under the title of the statute,
select the tab labelled “Regulations.” How many regulations are listed?


1. D. Beatty, Putting the Charter to Work: Designing a Consti- 11. Toronto Electric Commissioners v. Snider, 1925 CanLII 331
tutional Labour Code (Montreal, QC: McGill-Queen’s Uni- (UK JCPC).
versity Press, 1987) at 22. See also M. Thomas, Regulating 12. Canada, Commission on the Review of Federal Labour
Flexibility: The Political Economy of Employment Standards Standards (citing statistics from 2005).
(Montreal, QC: McGill-Queen’s University Press, 2009)
13. See the discussions in Construction Montcalm Inc. v. Min.
at 30.
Wage Com., [1979] 1 SCR 754 (a company retained to
2. H. Arthurs, Fairness at Work: Federal Labour Standards for build runways at a Montreal airport is provincial, since its
the 21st Century (Ottawa, ON: Human Resources and ordinary business is construction); and Northern Telecom
Development Canada, 2006) at 5. v. Communications Workers, [1980] 1 SCR 115.
3. Ibid. at 47. 14. Reference re Application of Hours of Work Act (BC) to
4. See, for example, Employment Standards Act, S.O. 2000, Employees of CPR in Empress Hotel, Victoria, [1950]
c. 41, s. 5(1): “no employer or agent of an employer and no AC 122.
employee or agent of an employee shall contract out of or 15. Validity and Applicability of the Industrial Relations and
waive an employment standard and any such contracting Disputes Investigation Act, [1955] SCR 529.
out or waiver is void.” See, for example, Machtinger v. HOJ 16. For a good summary of the law-making process at the
Industries, [1992] 1 SCR 986 (a contract clause requiring federal level, see Canada, Privy Council, “Guide to Making
less notice of termination than the ESA mandates is void). Federal Acts and Regulations,” online: <https://www
5. See, for example, Ontario’s ESA, s. 5(2): “If one or more .canada.ca/en/privy-council/services/publications/guide
provisions in an employment contract or in another Act -making-federal-acts-regulations.html>. See also Legisla-
that directly relate to the same subject matter as an tive Research Service, Legislative Assembly of Ontario,
employment standard provide a greater benefit to an em- “How an Ontario Bill Becomes Law,” online (pdf):
ployee than the employment standard, the provision or <https://www.ola.org/sites/default/files/common/how
provisions in the contract or Act apply and the employ- -bills-become-law-en.pdf>.
ment standard does not apply.” For examples of the appli- 17. They are called a member of Parliament (MP) at the
cation of “greater benefits,” see Stan Seidenfeld Professional federal level or a member of provincial Parliament (MPP)
Corporation v. Huihua (Linda) Peng, 2016 CanLII 26939 at the provincial level (this title varies across the provinces;
(Ont. LRB); and Re Queen’s University and Fraser et al., for example, in Quebec, elected representatives are called
1985 CanLII 2260 (Ont. Sup Ct J). members of the National Assembly, and in Alberta they
6. Rizzo & Rizzo Shoes Ltd. (Re), [1998] 1 SCR 27. are called members of the Legislative Assembly).
7. Constitution Act, 1867, 30 & 31 Vict., c. 3, reprinted in RSC 18. Employment Standards Act, RSBC 1996, c. 113.
1985, Appendix II, No. 5, s. 91. 19. Ibid.
8. Johannesson v. Municipality of West St. Paul, [1952] 1 20. For example, the Ontario Labour Relations Board (Ont.
SCR 292. LRB) was created by s. 2 of the Labour Relations Act of
9. Constitution Act, 1867, s. 92. 1948 to administer that Act. Section 110 of today’s Ontario
Labour Relations Act states simply that “[t]he board known
10. See, for example, Re Ottawa-Carleton Regional Transit
as the Ontario Labour Relations Board is continued” and
Commission and Amalgamated Transit Union, Local 279
then describes in detail the powers of the board. For a
et al., 1983 CanLII 1936 (Ont. CA) (an Ottawa-based bus
history of the Ont. LRB, see Ontario Labour Relations
company that regularly crosses into Quebec is federally
Board, “About Us,” online: <http://www.olrb.gov.on.ca/
regulated, even though the percentage of work done in
english/aboutus.htm>.
Quebec was less than 5 percent of the company’s business);
and Re Tank Truck Transport, [1963] 1 OR 272 (CA) (a 21. H. Arthurs, “National Traditions in Labor Law Scholar-
trucking company is federally regulated when 6 percent of ship: The Canadian Case” (2002) 23 Comp Lab L & Pol’y J
its business derives from regular trips outside of the prov- 645 at 660; and J. Fudge & E. Tucker, Labour Before the
ince). Contrast with Agence Maritime Inc. v. Conseil Cana- Law (Toronto: Oxford University Press, 2001).
dien des Relations Ouvrières et al., [1969] SCR 851 (the fact 22. Demarcating category one and category two laws is not a
that boats crossed provincial borders three times in a two- precise science. Some types of statutes could be placed into
year period was insufficient to bring the company under either category. For example, although human rights stat-
federal jurisdiction). utes govern discrimination in the employment

relationship, they also regulate discrimination in housing .on.ca/documents/sjto/2013-14%20Annual%20Report

and the provision of services to the public (among other .html>.
areas). Therefore, human rights laws are not entirely con- 23. H. Arthurs, “Charting the Boundaries of Labour Law:
cerned with the employment relationship and protecting Innis Christie and the Search for an Integrated Law of
vulnerable workers. However, we treat human rights legis- Labour Market Regulation” (2011) 34 Dal LJ 1 at 14-15.
lation as an output of the work law subsystem because it is
24. Ibid. See also the discussion in D. Doorey & R. Dukes,
a fundamental component of government’s legislative
“Labour Law and Its ‘Last Generation,’” in P. Zumbansen,
strategy to protect workers and pursue “decent” working
D. Drache, & S. Archer, eds, Liber Amicorum Festschrift: In
conditions. Moreover, the vast majority of human rights
Tribute to Harry Arthurs (Montreal, QC: McGill-Queen’s
complaints in Canada relate to alleged discrimination in
University Press, 2017) 307.
the employment relationship. For example, nearly three-
quarters of complaints (74 percent) heard by the Human 25. The question of where the boundaries of work law should
Rights Tribunal of Ontario in 2013 – 14 were related to be drawn is one of the great, enduring debates in labour
employment: see Social Justice Tribunals Ontario, law scholarship. My approach in this text is heavily influ-
“2013 – 14 Annual Report,” online: <http://www.sjto.gov enced by Arthurs, supra note 23.


C H A P T E R 18
Wage Regulation and Pay

Equity
II. The Scope of Wage Regulation 286
• Explain why governments regulate wages.
A. Wage Regulation Applies to Employment Contracts 286
• Describe the different types of wage regulation in Canada. B. Many Employees Are Excluded from Wage Regulation 286
• Discuss the origins of Canadian minimum wage regulation. C. Wage Laws Vary by Occupation 287
• Describe the profile of minimum wage earners in Canada. III. Minimum Wage, Wage Freeze, and Maximum Wage Legislation 288
• Describe debates over the effectiveness of a minimum wage as a A. Minimum Wage Legislation 288
poverty-reduction strategy. B. Wage Freeze or Restraint Legislation 290
C. Maximum Wage Legislation 292
• Explain how governments regulate wage freezes and impose wage
IV. Regulating Wage Discrimination 292
restraints, and describe some of the challenges of doing so.
A. Equal Pay for the Same Job (Equal Pay Laws) 294
• Discuss recent debates about whether laws should be enacted to B. Equal Pay for Equal Work and Equal Value 295
regulate very high wages as a way to address growing income
V. Chapter Summary 299
inequality.
• Explain the different approaches used in Canada to address the Exercise 300
persistent gender wage gap. Notes and References 301
I. Introduction
At different times, in different places, and for a variety of public policy reasons, governments
around the world have felt the need to regulate wages. For example, in our discussion of the old
British master and servant law in Chapter 5, we learned about early legislation that fixed wages
after the Black Death killed millions in Europe during the 14th century and left a vast labour
shortage. Wage-fixing laws were implemented to ensure workers could not use their bargaining
leverage to drive wages up. Modern Canadian governments have also occasionally used wage
freeze or wage-fixing legislation to tackle wage inflation or reduce the government’s payroll. But
the most common forms of wage regulation today focus on protecting a wage floor—a minimum
wage to prevent employers from using their bargaining power to drive wages too far down—and
on addressing gender wage discrimination.
Canadian governments have demonstrated little confidence that unregulated labour markets
will produce acceptable wage levels. The neoclassical perspective (see Chapter 3), which favours
wage setting by unregulated market forces and negotiations between employers and individual
employees, has not won the day. Yet many aspects of wage regulation remain controversial. Do
minimum wage laws actually reduce poverty? Should governments interfere in labour markets
by fixing wage rates? Should governments impose a “maximum wage” to slow growing income
inequality in Canada? Should governments attempt to use statutory intervention to close the
285

gender wage gap, and if so, what should those laws look like and will they work? These are some
of the most fascinating debates within the regulatory standards regime, and we begin to consider
them in this chapter.
II. The Scope of Wage Regulation

Wage laws can be difficult to understand because they rarely apply uniformly. There are exclu-
sions, special rules, and varying occupational rates; sometimes mandatory wage rates are found
in statutes, other times they are in regulations. Let’s begin our discussion with a quick overview
of the scope of wage regulation.
A. Wage Regulation Applies to Employment Contracts

Wage regulation governs employment contracts. Governments generally do not regulate the
price at which independent contractors sell their services. We considered the difference between
an employee and an independent contractor in Chapter 4. If a worker does not meet the defin-
ition of an employee in the statute, then the laws governing wages do not apply. Independent
contractors can agree to work for $2 per hour if they want, even if the minimum wage is $10 per
hour, since employment standards legislation does not apply to them.1 As discussed in Chapter
4, the recent rise of “gig” work and other forms of non-standard work characterized by workers
who exhibit many indications of entrepreneurship, but who nevertheless remain economically
precarious, has led to policy debates in Canada and abroad about the continued appropriateness
of limiting wage protections to “employees.”2
B. Many Employees Are Excluded from Wage Regulation

Even if a worker meets the definition of an employee, they may nevertheless still be excluded
from all or part of wage regulation. Exclusions from wage regulation can apply to an entire
occupation (e.g., lawyers or real estate agents) or to a specific job (e.g., wild boar farmer). For
example, in Ontario a person employed on a farm whose employment is directly related to the
production of ratites or wild boar is excluded from the minimum wage law, but not employees
on a farm that raises alpacas!3 In Alberta, farm employees, extras in films, and real estate bro-
kers, among others, are not entitled to the provincial minimum wage.4 Articling students train-
ing to be lawyers are usually excluded from minimum wage laws, as are many other workers
performing mandatory on-the-job training necessary to qualify for professional status.5 Stu-
dents working at a business as part of a practicum or experiential education component of their
college or university program are often excluded from employment standards legislation and,
therefore, are not covered by wage laws.6
Each Canadian jurisdiction has its own list of wage law exemptions, which can make wage
regulation challenging for employers and employees alike to sort out. As noted in Chapter 4, a
recent challenge in Canadian employment law has been the mischaracterization of employees
as “unpaid interns” or “unpaid trainees” by some employers.7 Administrative tribunals have
resisted this strategy by ruling that there is no legal category in the regulatory regime of “unpaid”
intern or trainee, other than students working as part of an educational program.8 Ontario
recently passed a law that makes it an offence for an employer to treat “a person who is an
employee of the employer as if the person is not an employee” under employment standards
gender wage gap: The difference in earnings between males and females.
but does not say what that wage rate is. That act gives the government the right to introduce regulations (in s. 141), and one

Chapter 18 Wage Regulation and Pay Equity 287
legislation. This law similarly attempts to address the growing problem of employers seeking to
avoid wage laws by artificially rebranding their employees as “non-employees.”9
C. Wage Laws Vary by Occupation

A final point to note about the scope of wage regulation is that different rules can apply to dif-
ferent occupations. For example, employment standards laws usually fix a general minimum
wage rate that applies to most employees, and then list occupations that require rates different
from the general rate. Some occupations may be entitled to a fixed minimum wage, such as
“live-in home support workers” in British Columbia, who are entitled to a minimum wage of at
least $113.50 for each day or part day worked.10 Some occupations are entitled to a minimum
wage that is lower than the standard rate, such as liquor servers.11 The rationale for permitting
liquor servers to be paid a lower minimum wage is that they earn tips, although curiously most
provinces do not guarantee that liquor servers be permitted to keep their tips. As a result, some
restaurants and bars collect (and sometimes take) a portion of tips earned and then create a tip
pool that is divided among other employees.12 This practice is known as tipping out. Some
provinces, including New Brunswick and Prince Edward Island, have prohibited employers
from taking tip money from servers.13
It is worth noting, because lots of people misunderstand this point, that employees earning
a salary (and not employed in an occupation excluded from the minimum wage) are also en-
titled to earn at least the minimum wage. Their hourly wage rate, which must be at least as
much as the minimum wage, is determined by dividing their salary by the number of hours
worked. The minimum wage for some occupations is established based on piecework pay. For
example, in British Columbia, an apple picker is entitled to at least $17.06 per 27.1 cubic foot
bin of apples picked, while the minimum rate for a Brussels sprout picker is $0.163 per pound.
How is that for a detailed law? To make matters even more challenging, many of the numerous
special rules and exemptions are buried deep in regulations, which can make them difficult to
locate.
This quick summary is enough to give you a flavour for the complexities that often arise when
studying wage laws. The exercise at the end of this chapter focuses on how to locate wage regula-
tion rules. The goal of this chapter is to introduce key areas of wage regulation in Canada and
some of the central debates that shape wage laws. It would be impossible in the space we have
to describe every law in Canada applicable to wages.14 Thankfully, Canadian governments have
prepared helpful guides describing many of the laws, which you can find on Ministry of Labour
websites, as described in Box 18.1.

Making Use of Government Resources
Every Canadian government produces documents to explain “employment standards” and [your province]. For example, if
their laws. These documents are a great place to start if you I do this search for Ontario, I find a link to the Ontario Ministry
have specific questions about work regulation. To access this of Labour website that includes links to a large variety of
content, do an Internet search of [“Ministry of Labour” and guides, resources, and calculation tools.
tipping out: The practice by some restaurant or bar employers of collecting (and sometimes taking) a portion of servers’ tips
and dividing the tip pool among other employees.
piecework pay: Wages calculated based on the number of pieces produced by an employee.

III. Minimum Wage, Wage Freeze, and Maximum Wage Legislation

Wage laws are always driven by some underlying public policy concern. A government might
be worried that wages are too low or too high, given a range of public policy objectives. This
section explores three key types of wage regulation: minimum wage legislation, wage freeze or
restraint legislation, and maximum wage legislation.
A. Minimum Wage Legislation

In the early 20th century, when Canadian governments first began to seriously contemplate
enacting mandatory wage floors, both unions and the business community resisted. Business
leaders argued that a minimum wage would cause layoffs, attract a flood of foreign workers
(which would increase unemployment), and encourage laziness in workers, who would no
longer work as hard to win raises from their employers.15 Many union leaders believed that a
statutory minimum wage would either act as a downward pressure on the higher rates that
unions had bargained for their members or reduce demand for unionization. They preferred to
leave wage setting to collective bargaining between unions and employers.
However, unions generally did support minimum wage laws for women, whom they consid-
ered to be especially susceptible to exploitation at the hands of employers.16 Unions also sup-
ported a minimum wage for women to protect their male members’ wages from cheap
competition. In the years after World War I, by which time women had started to work in fac-
tories doing “men’s work,” unions lobbied for laws to ensure “equal pay for equal work” between
men and women. Employers’ groups too were less hostile to a minimum wage for women work-
ers, provided that it was fixed very low.
The paternalistic notion that men could look after themselves, sometimes with the help of
unions, but that women required government protection shaped early minimum wage laws in
Canada. The earliest minimum wage law in Canada appeared in the Alberta Factories Act of
1917.17 For a 10-hour day, it required that employees be paid at least $1.50, a very low amount even
for 1917. Other provinces quickly followed. In 1918, Manitoba and British Columbia enacted min-
imum wage legislation, followed by Saskatchewan and Quebec (1919), and Ontario, Nova Scotia,
and Alberta (1920). Prince Edward Island was the final holdout; it did not enact minimum wage
legislation until 1959. Early wage legislation applied to women, but not to men or boys. Initially,
the minimum wage level was usually set by wage-setting boards, which fixed rates by industry and,
sometimes, geographical location, taking into account the local cost of living.18
Not until 1925 was minimum wage legislation finally extended to male workers, first in Brit-
ish Columbia and then later in other jurisdictions.19 In the beginning, male minimum wage
rates were often higher than female minimum wage rates because it was assumed that men were
supporting a family while women were just earning “pin money.”20 The gender gap in minimum
wage laws did not disappear completely in Canada until the early 1970s. Today, every Canadian
jurisdiction has a minimum wage that applies equally to men and women. Federally regulated
employees are governed by the minimum wage applicable in the province or territory in which
they perform their work. It makes little sense to list those wages here, since they regularly
change, but it is easy to find the rates with a basic Internet search.21 At the time of writing in fall
2019, the standard minimum hourly wage rates varied in Canada from a high of $15 in Alberta
to a low of $11.06 in Saskatchewan. In 2017, 10 percent of Canadian employees earned the min-
imum wage.22 A profile of those employees is summarized in Table 18.1.
Some provinces still use minimum wage boards that periodically recommend minimum
wage rates to the government, while others rely on the government to decide the matter without
a board. Ontario, Saskatchewan, Nova Scotia, and Yukon link the minimum wage to the con-
sumer price index, an economic formula that estimates the cost of living.23
Whether the minimum wage is good policy has been debated for over a century. Box 18.2
summarizes some of the main arguments in the debate.

TABLE 18.1 Percentage Distribution of Minimum Wage Workers in Canada, March 2018
Percentage of Minimum
Wage Workers in This
Category
Age Group Student, Age 15–24 31.6
Not Student, Age 15–24 17.2
Age 25–34 16.3
Age 35–54 21.8
Age 55–64 9.6
Age 65 and over 3.6
Life Arrangement Age 15–24, living with parents 33.2

Age 15–64, single lone parent or in single-income couple 16.6
Age 15–64, in a dual-earner relationship 18.2
Sex Women, Age 15–24, living with parents 54.1

Women, Age 15–64, single lone parent or in single-income couple relationship 60.4
Women, Age 15–64, in a dual-earner relationship 65.8

Source: R. Morisette & D. Dionne-Simard, “Recent Changes in the Composition of Minimum Wage Workers” (13 June 2018), online: Statistics Canada,
<https://www150.statcan.gc.ca/n1/pub/75-006-x/2018001/article/54974-eng.htm>.

Is the Minimum Wage a Good Policy?
Although minimum wage laws in some form have been part poverty, because a high proportion of people receiving the
of the Canadian employment law landscape for a century now, minimum wage are not poor—they are students living with
the question of whether a statutory mandatory wage floor is their parents or workers who have spouses earning more than
a good labour policy remains among the most hotly contested the minimum wage.‡
questions in labour policy. The pro-minimum wage camp relies on different economic
On one side of the debate is the anti-minimum wage camp, studies that purport to show that minimum wage laws help
armed with the neoclassical perspective’s economic claim the poor break from the cycle of poverty and reduce income
(described in Chapter 3) that a statutory minimum wage causes inequality by increasing the disposable income of the working
unemployment by driving wages above market rates.* More- poor.§ This camp doubts that raising the minimum wage has
over, this camp argues, the negative unemployment effects much impact on overall employment levels. Canadian econo-
are felt mostly by the very people the law intends to help—low- mist Jim Stanford captures this argument succinctly when he
skilled workers, the young and old, and new immigrants—since claims “the effect of minimum wages on employment is prob-
they are the first ones to lose their jobs when the minimum ably a wash.”# Since economists cannot agree on the effects
wage is implemented. The Canadian Manufacturers’ Associa- of minimum wage laws on employment levels, the pro-
tion made these arguments in 1917 when Canada was first minimum wage camp looks beyond economics and relies on
debating whether to enact minimum wage laws, and minimum basic fairness and justice arguments. They assert that a
wage opponents present the same arguments today whenever wealthy, modern country such as Canada should strive to pay
an increase is being considered.† This camp argues too that workers a living wage that promotes self-dignity and de-
minimum wage laws are a “blunt instrument” for alleviating cency, and that a minimum wage law is a key aspect of that
living wage: Different measures exist but, in general, it is a measure of the wage level that would be necessary to enable a
full-time employee to earn enough money to meet basic needs, such as food, clothing, child care, and shelter.

policy. Professor Harry Arthurs (York University) captured this 1995). See also D. Doorey, “The Two Sides of the Minimum Wage Debate:
Friedman v. Kennedy,” online: Law of Work (blog), <http://lawofwork
sentiment in his recent report on federal employment
.ca/?p=6648>.
standards:
# J. Stanford, “The Non-Simple Economics of the Minimum Wage,” online,
The Progressive Economics Forum (blog) (February 22, 2011): <http://
In the end … the argument over a national minimum
www.progressive-economics.ca/2011/02/22/
wage is not about politics and economics. It is about the-non-simple-economics-of-the-minimum-wage>.
decency. Just as we reject most forms of child labour
** H. Arthurs, Fairness at Work: Federal Labour Standards for the 21st Century
on ethical grounds, whatever their economic attrac-
(Ottawa: Human Resources and Skills Development Canada, 2006) at
tions, we recoil from the notion that in an affluent 247. See also the work of Toronto-based Workers’ Action Centre, which
society like ours good, hard-working people should advocates for a higher minimum wage: <http://www
have to live in abject poverty.** .workersactioncentre.org>.
* See R. Posner, Economic Analysis of Law, 5th ed (New

York: Aspen, 1998) at 361; and A. Davies, Perspectives
on Labour Law, 2nd ed (Cambridge, UK: Cambridge
University Press, 2009) at 139-42.
† M.E. McCallum, “Keeping Women in Their Place: The

Minimum Wage in Canada, 1910-25” (1986) 17 Lab 29
at 34. For contemporary representations of these
anti-minimum wage arguments, see the regular
reports of the neoclassical-inspired think tank the
Fraser Institute, including A. Karabegovic &
N. Veldhuis, “Minimum Wages Don’t Help the Poor,”
Fraser Forum, May/June 2011.
‡ See the discussion of the Canadian literature in

M. Gunderson, Minimum Wages: Issues and Options
for Ontario (Toronto: Ministry of Finance, February
2007), online: <http://www.fin.gov.on.ca/en/
publications/2007/Gunderson>.
§ An often-cited study that found little to no

employment-level impacts of small minimum wage Tim Hortons’ employees demonstrate in Cobourg, Ontario, in response to a 2018
increases is D. Card & A. Krueger, Myth and
Measurement: The New Economics of the Minimum
letter from a franchise owner stating that employees will have reduced benefits
Wage (Princeton, NJ: Princeton University Press, and lose paid breaks as a result of minimum wage increases in Ontario.
Governments frequently express concern over a minimum wage that is higher than the rate
in effect in other “competing” jurisdictions for fear that businesses could pack up and move. In
this way, the political subsystem and the economic and market subsystem interact in complex ways
that affect debates about minimum wage laws.
B. Wage Freeze or Restraint Legislation

A wage freeze is a practice (or law) that holds wages at their existing level for a period of time. In
the private sector, employers often impose wage freezes, and when they do, unhappy workers can
respond by quitting. In a unionized workplace, the employer would need the union and employ-
ees to agree to a wage freeze, and workers could strike to resist one. Governments mostly stay out
of these disputes and let private sector employers work things out with their employees (and their
unions). In 1975, the Liberal government, led by Prime Minister Pierre Elliott Trudeau, imposed
wage controls on private sector companies with 500 or more employees and construction com-
panies as a strategy to tackle high inflation.24 However, that was an unusual exception to the more
general rule that Canadian governments do not impose wage restraints on the private sector.
wage freeze: A law or employer practice that holds wage rates at existing levels for a period of time.

The public sector is a different matter. Governments have imposed wage freezes or controls
on their own employees on a fairly regular basis over the years. Freezing wages of non-unionized
public sector employees is easy enough: the government can just refuse to include money for
raises in its budget, order its managers not to grant any raises, or pass wage-fixing legislation
that expressly freezes wages or restrains the level of raises. Consider the federal Public Sector
Compensation Act of 1991 as an example of wage freeze legislation:
[N]o employee shall be entitled to the incremental increases, including those based on the attainment
of further qualifications or the acquisition of skills, merit or performance increases, in-range
increases, performance bonuses or other similar forms of compensation that would, but for this
subsection, form part of their compensation plan, during the period of twenty-four months begin-
ning on the day on which this subsection comes into force.25
Sometimes governments do not freeze wages but legislate a fixed-wage increase instead. For
example, the 2009 federal Expenditure Restraint Act fixed wage increases for some government
employees at a rate of 1.5 percent for three consecutive years.26
The process of legislatively freezing wages is trickier when public sector workers are union-
ized. Their wages are set by a collective agreement that is bargained on their behalf by their
union. Therefore, if a government wants to freeze its unionized employees’ wages, it must bar-
gain a wage freeze with the union, legislatively void a collectively bargained raise, or enact a law
stripping the union of the right to bargain regarding wages. Any one of these routes can prove
challenging for a government. Unionized workers rarely voluntarily agree to a wage freeze in
bargaining, so a government demand for a wage freeze usually provokes the threat of a labour
stoppage (a strike or a lockout), which neither the government nor the employees want. As a
result, collectively bargained wage freezes are rare.
More often, a government legislates a wage freeze or a cap on raise levels. Doing so angers
unions and unionized employees, harms workplace morale, and can provoke disruptive worker
protests. Moreover, for reasons we will explore in greater detail in Part IV the Canadian Charter of
Rights and Freedoms’ protection of “freedom of association” and the right to collective bargaining
imposes some limits on the right of governments to impose wage freezes or restraints on unionized
employees. The Charter does not necessarily prohibit statutory wage freeze or restraint legislation,
but it does impose limitations on the right of governments to take this course of action.27

The Internal Feedback Loop: How Legislative Wage Freezes Can Encourage Unionization
In Chapter 2, we described the internal feedback loop, part of was unintended by the Ontario government.* The output of
the work law subsystem. The internal feedback loop demon- the regulatory standards regime (wage freeze legislation tar-
strates how the three work law regimes interact and influence geting only non-union government employees) provoked a
one another. An example is provided by a decision of the On- response by some non-union workers affected by the wage
tario government to freeze the wages of its non-union employ- freeze that included joining unions to have their working
ees but not its unionized employees. conditions determined under the collective bargaining regime
In 2009, the Ontario government froze the wages of all of rather than a combination of the common law regime and the
its non-union employees, while it requested that its unionized regulatory standards regime.
employees voluntarily accept a wage freeze, which did not
happen. Some of its unionized employees later received raises * K. Howlett, “Ontario Health-Care Workers Unionize in Face of
that had been collectively bargained or awarded by interest McGuinty Wage Freeze,” Globe and Mail (2012), online: <http://www
arbitrators. This outcome caused resentment among many .theglobeandmail.com/news/national/ontario-health-care-workers
non-union employees whose wages had been frozen. -unionize-in-face-of-mcguinty-wage-freeze/article1360154>.
Some of these non-union government employees re-
sponded by joining unions themselves, an outcome that surely

C. Maximum Wage Legislation

While reasonable people can disagree on whether it achieves its stated purpose, it is clear that
minimum wage laws are intended to reduce poverty among the working poor and restrict com-
petition based on very low wages. It is meant to protect vulnerable workers who are deemed
incapable of protecting their own economic interests because of a lack of bargaining power.
Workers who are at the other end of the wage scale—the rich and powerful—present a different
sort of challenge. Highly paid executives are certainly not vulnerable, and they usually have
considerable bargaining power. Therefore, while low wages have long been considered a social
and economic problem requiring state intervention in the form of statutory wage floors, high
wages have not attracted much government attention.
High wages have not been completely ignored, though. Salary disclosure laws for executives
and public sector workers were once believed to be a means of applying downward pressure on
high salaries.28 However, some studies indicate that disclosure laws actually have an inflationary
impact on salaries, because workers use the information to bargain up their salaries.29 Recently,
growing income inequality and the ballooning gap between executive pay and average worker
pay have led to calls for new forms of maximum wage legislation.30 In Canada, the ratio of CEO
pay to average workers’ pay was about 30 to 1 in the 1970s. By 2016, it was 209 to 1.31 This con-
centration of wealth is an indication of economic inequality, yet it is not obvious how work law
might produce a more egalitarian distribution of income. Switzerland recently held a referen-
dum on a proposed law that would restrict CEO compensation to a ratio of 12 to 1 in relation
to the wage of the lowest-paid employee, but voters rejected it.32 The United States passed a law
in 2010 that requires public corporations to report the ratio of their CEO’s total compensation
to the pay of the median employee.33 No mandatory compensation ratio laws exist in Canada
yet. However, some Canadian governments have recently passed laws that regulate the compen-
sation levels of executives of public sector corporations.34
IV. Regulating Wage Discrimination

Female employees earn less than male employees. They always have. In 1911, women earned
about 53 percent of what men earned. By 2018, that gender wage gap had shrunk and women
earned about 87 percent of what men earned, according to Statistics Canada.35 These numbers
are based on a comparison of average wages for a full-time worker. If you dig deeper, you find a
variety of variances based on occupation, education level, employment status (full time versus
part time), union status, family status, and age, among other factors. For example, the wage gap
for women who have children exceeds that for childless women, suggesting that a “child wage
penalty” exists in Canada.36 Women with a post-secondary education in Canada earn on
average only 63 percent of what similarly educated men earn.37
A significant racial wage gap exists in Canada, too. A study of Ontario wages found that
racialized men earn about 74 percent of what non-racialized men earn, and racialized women
earn about 84 percent of what non-racialized women earn. For first-generation immigrants, the
gap is even wider: racialized women earn 47 cents for every dollar non-racialized men earn.38
Disabled workers also earn considerably less than able-bodied workers.
Historically, blatant wage discrimination, such as separate wage schedules for men and
women, was either condoned by Canadian governments or, in the case of early minimum wage
laws that fixed women’s wages lower than men’s, expressly legislated. Today, legislation that
directly discriminates in wage levels is rare, though some examples still exist. For example, in
statutory wage floor: A law that fixes a minimum wage below which an employer cannot pay an employee.
racial wage gap: The difference in earnings between the dominant racial group in a society and racialized groups.

Saskatchewan it is still permissible for employers to pay disabled workers less than able-bodied
workers in certain circumstances, presumably on the theory that employers will not hire them
otherwise.39
Human rights statutes have long prohibited employers in Canada from discriminating in
wages based on race, ethnicity, disability, gender, and other designated grounds (see Chapter 21).
These statutes discourage the most blatant types of direct wage discrimination. However, they
have proved inadequate for addressing less obvious forms of wage discrimination, such as sys-
temic discrimination that perpetuates wage differences. Human rights legislation is complaint
based, so it requires employees to learn their legal rights, file a complaint against their employer
(which few do), and prove that their lower pay rate is related to discrimination on a prohibited
ground listed in the legislation. These hurdles are difficult to overcome.
Nowadays, the racial wage gap and the gender wage gap are mostly a result of occupational
divisions in our labour markets and other non-discriminatory factors related to productivity
differences (such as length of service, education, or work experience). For reasons we will dis-
cuss next, a bare human rights prohibition against discrimination in employment is ill-equipped
to address the more complex causes of wage differentials.
TABLE 18.2 Laws Used to Address Gender Wage Discrimination in Canada

Example of Wage
Type of Wage Discrimination Law Discrimination It Covers Where the Law Is in Effect
Equal pay laws: The employer must not A bank has two rates of pay for All jurisdictions: This type of
maintain differential pay rates for men tellers, one for men and a direct discrimination violates
and women performing the same job, lower rate for women. human rights statutes as well
unless some other non-gender-related as employment standards and
explanation exists for the difference. pay equity statutes.
Equal pay for equal work laws: The A female bank teller earns less The private sector: All
employer must pay the same wages to than a male accounting clerk jurisdictions except Quebec
men and women who perform who works in the same office. and the federally regulated
“substantially similar work”—work in The two jobs require private sector.
which the evaluation score of each of substantially similar skill, effort, The public sector: Alberta,
the following factors is substantially the and responsibility, and share British Columbia,
same: skill, effort, responsibility, and similar working conditions. Newfoundland and Labrador,
working conditions. and Saskatchewan.
Equal pay for work of equal value A female-dominated job class The private sector: The
laws: Employer must identify male- and of secretary earns less than a federally regulated private
female-dominated jobs and then male-dominated job class of sector, Ontario, and Quebec.
evaluate each job based on skill, effort, machine operator, even The public sector: The federal
responsibility, and working conditions. If though their total aggregate level, Manitoba, New
the total score (value) of a female- job evaluation scores are Brunswick, Nova Scotia,
dominated job is equal or approximately approximately equal. Ontario, Prince Edward Island,
equal to that of a higher-paying male- and Quebec.
dominated job, the employer must raise
the wage of the female-dominated job.
systemic discrimination: Practices, behaviour, norms, or policies within an organization that may be unintentional and
unobserved yet perpetuate disadvantages for certain individuals because of a personal attribute or characteristic (e.g., race,
gender, age, disability, or religion).
complaint-based statutes: Statutes that are enforced entirely or predominantly by means of individual complaints of statutory
violations filed by victims.

A. Equal Pay for the Same Job (Equal Pay Laws)
Canadian governments have gone much further in their legislative efforts to address the gender
wage gap than they have the racial wage gap and wage discrimination against disabled workers.
It should be noted, though, that legal measures that reduce the gender wage gap could also affect
the racial wage gap insofar as racialized groups are overrepresented in “traditionally female-
dominated jobs.” A law that raises wages in those jobs would benefit all employees in those
jobs.40 Table 18.2 summarizes the three models of laws enacted in Canada to address gender
wage discrimination over the years. We will discuss each, beginning with the most straight-
forward (and limited) model: equal pay laws.
As noted earlier, gender wage discrimination was once official government policy in Canada.
Minimum wage laws fixed female wages at a lower level than male wages on the assumption that
men were supporting families and women were just earning “pin money.” However, in 1951,
Ontario enacted the Female Employees Fair Remuneration Act, which banned blatant gender
wage discrimination, and other Canadian jurisdictions soon followed. These equal pay laws
worked well enough in addressing direct gender wage discrimination, such as when an em-
ployer adopted a two-tier wage grid divided purely on the basis of gender. A bank could no
longer have one wage for male tellers and a lower wage for female tellers. Explicit gender-based
wage grids have (we will assume) been abolished in Canada. However, the explanation for the
persistence of a gender wage gap is far more complex than just blatant sexism.
Economists have observed that women tend to “crowd” into relatively lower-paying jobs (e.g.,
retail, sales, and other service sector jobs; clerical work; and child care), and more often than
men they tend to select jobs that involve lower risk, less travel, and fewer working hours (all
factors that tend to be associated with lower wages).41 The segregation of women and men into
different types of jobs is called occupational crowding, and the influx of women into lower-
paying jobs lowers their wages even further.42 Since more women are employed in lower-paying
job sectors, it is hardly surprising that women’s wages would on average be lower than men’s.43
Many women choose those lower-paying jobs to balance their paid jobs with their unpaid jobs
in the home. Women shoulder a much greater responsibility for domestic work than do men.44
Although child care and other unpaid domestic work is essential to the functioning of all
societies, it is largely ignored in economic measures of work activity because it is considered to
be a non-market activity. Feminist law scholars (writing from the critical reformist perspective
described in Chapter 3) have long argued that unpaid domestic work should be measured and
valued as an economic activity in both our economic indicators (e.g., gross domestic product)
and our legal doctrines.45 For example, in recent years, common law judges have begun to award
injured women tort damages for “loss of homemaking capacity,” recognizing the economic value
of unpaid work in the home.46 However, like most work laws, pay discrimination laws are dir-
ected at pay differentials based on gender discrimination in paid employment only.
Wage equality laws can do little, if anything, to alter wage differentials based purely on dif-
ferences in skill, training, education, and labour market supply. A surgeon will always earn more
money than a retail store cashier because the skills, education, responsibility, and labour supply
are so vastly different. The fact that the surgeon is male and the cashier is female does not signify
improper wage discrimination. It makes sense that an employer would pay a male forklift driver
with 15 years’ experience more than a female driver hired directly out of forklift school. A male
equal pay laws: Laws or rules that require employers to pay women the same wage rate as men for “equal work” (which
usually means “the same job”).
occupational crowding: A term used to describe the segregation of women and men into different types of jobs. It is usually
used to explain how women tend to be much more highly represented in lower-paying jobs (e.g., retail, sales, and other service
jobs; clerical work; and child care) than are men.

software designer with a PhD in computer science would expect to start at a higher pay rate than
an employee, male or female, with no post-secondary education. Economists estimate that 85 to
90 percent of the gender wage gap is due to occupational crowding and other factors such as
differences in education, training, and experience.47 The remainder of the wage gap is often
attributed to wage discrimination: a difference in pay because of direct gender bias or systemic
discrimination in which traditionally female jobs—“women’s work”—are undervalued relative
to traditionally male jobs. More sophisticated laws were needed to tackle this discrimination.48
B. Equal Pay for Equal Work and Equal Value

Equal pay laws that targeted gender-based, two-tier wage grids in the same job were not up to
the task of tackling the more complicated problem of wage discrimination based on the under-
valuing of “women’s work” more generally. Therefore, Canadian governments introduced two
additional legal models to address the matter.
1. Equal Pay for Equal Work Laws (Comparable Worth)

Equal pay for equal work (EPEW) requirements, which are found in either or both of employ-
ment standards or human rights legislation in Canada, require equal pay for “substantially simi-
lar work.” Americans refer to the EPEW model as the “comparable worth” approach to achieving
equal pay between women and men. The EPEW model recognizes that sometimes women are
paid less by employers because they work in traditionally female jobs that have been
undervalued because of their gender dimension. EPEW laws are violated if a woman is paid less
than a man who performs substantially the same kind of work for an employer in the same
establishment.
In order to determine whether two jobs are “substantially similar,” EPEW laws require an
assessment of certain job evaluation criteria, which are usually skill, effort, responsibility, and
working conditions, as Box 18.4 describes.49 If the two jobs are substantially similar in terms of
these factors, and the woman earns less than the man, the law requires that the woman’s wage
rate be increased to the man’s wage rate (a male employee’s wage cannot be reduced to achieve
equality). However, there may be a limitation on how far back the order to pay covers, such as
12 months from the date the complaint was filed. The statutes also provide exceptions if employ-
ers can demonstrate that the different pay rate is due to a reason other than gender. The BC
Human Rights Code language is typical. It says that a differential pay rate is not a violation of the
code if it is based on “a factor other than sex” and that factor “would reasonably justify the
difference.”50

Determining Whether Two Jobs Are “Substantially Similar”
Re Leisure World Nursing Homes Ltd. and Director of nursing home. Orderlies’ jobs were staffed by men, while nurs-
Employment Standards es’ aides’ jobs were staffed by women. Both jobs involved
1980 CanLII 1681 (Ont. H Ct J) providing around-the-clock care to elderly patients. The job
responsibilities were very similar, although the orderlies per-
Key Facts: A collective agreement between Leisure World formed more heavy lifting of patients, whereas the nurses’
Nursing Homes Ltd. and the union provided a higher pay rate aides did more rehabilitative physiotherapy. The nurses’ aides
for orderlies compared with nurses’ aides employed at a private filed a complaint under the equal pay for equal work provision
equal pay for equal work (EPEW): A statutory model that requires equal pay for men and women who perform “substantially
similar work” in the same establishment.

in the Ontario Employment Standards Act (s. 43 in the current conditions. The Ontario Divisional Court agreed. Orderlies did
act), alleging they were being paid less than the orderlies even not do heavy lifting every shift, while sometimes nurses’ aides
though the two jobs were “substantially similar.” The employer were required to do heavy lifting. Overall, the effort required
argued that the jobs were not “substantially similar” because of the two jobs was “substantially similar.” The skill, responsibil-
the greater amount of heavy lifting by orderlies required great- ity, and working conditions were also substantially similar. The
er effort and the fact that the pay rates were the result of col- referee found that the wage differential was “on the basis of a
lective bargaining with a union meant that the difference in stereotype misconception of the value of woman’s [sic] work.”
pay was due to a “factor other than sex.” The fact that the different wage rates were fixed through col-
lective bargaining did not prove that the different wage rates
Issue: Did the employer violate the EPEW requirement to pay were based on a “factor other than sex.” If employers and unions
female nurses’ aides and male orderlies equally for performing could avoid the EPEW requirement in the statute by simply
substantially similar work? bargaining different wage rates, they would be effectively
contracting out of the Employment Standards Act, which is not
Decision: Yes. The employment standards referee ruled that allowed. The employer was ordered to raise the wages of the
although the two jobs were not identical, they were substan- nurses’ aides to remedy the discrimination.
tially similar in terms of skill, effort, responsibility, and working
The EPEW approach has limited scope. It only allows for a comparison of jobs that require
identical or “substantially similar” skill, effort, responsibility, and working conditions at a single
workplace, where at least one man and one woman are employed in each job. It also tends to
suffer from the deficiency noted earlier in the chapter related to complaint-based justice mod-
els—that is, it depends on a woman learning the complex legal rules related to EPEW laws and
then having the means and willingness to file a complaint against her employer. Economists
have found that the EPEW model has had virtually no impact on the gender wage gap, despite
the fact that EPEW laws have been in existence in Canada for half a century.51
2. Equal Pay for Work of Equal Value Laws (Pay Equity)
Equal pay for work of equal value laws, or pay equity, are designed to tackle the systemic wage
discrimination in female-dominated jobs, a matter not addressed by the EPEW model. The pay
equity model requires that women and men receive equal pay for work of “equal value.” Only
seven Canadian jurisdictions have introduced pay equity legislation (the federal jurisdiction,
Ontario, Quebec, Manitoba, New Brunswick, Prince Edward Island, and Nova Scotia), and only
three (the federal jurisdiction, Ontario, and Quebec) apply the model to all or parts of the pri-
vate sector. Pay equity legislation is complex and fascinating legal engineering, so we cannot
begin to do a full exploration in this chapter. However, we will introduce the basic pay equity
model and explain how it differs from the EPEW model.52
The pay equity model recognizes that men and women often do not perform “substantially
similar” jobs, which is a big reason why EPEW laws do little to address the gender wage gap.
Men and women often perform different types of jobs, and jobs that are female dominated tend
to be valued less and are therefore paid less. A vivid example of this insight was presented by the
Ontario Coalition for Better Child Care during debates about a new pay equity law in Ontario
during the 1980s. The organization pointed out that farmhands, who are mostly male, were paid
around $22,000 per year in 1983, whereas child-care workers, who are mostly female, were
pay equity: A statutory model designed to address systemic gender wage discrimination by comparing lower-paying female-
dominated job classes to higher-paying male-dominated job classes when the total score is the same or substantially the same
in an evaluation of the skill, effort, responsibility, and working conditions of the two job classes.

paid only about $13,000. This prompted the coalition to ask whether we value pigs more than
children.53
The pay equity model assumes that a farmhand earns more than a child-care worker because
a farmhand is traditionally a male job, and male jobs pay more than female jobs. The pay differ-
ence is not due to the superior bargaining skills or specialized skills of the farmhand or to a
labour scarcity for farmhands, but to a systemic gender bias in our labour markets. The EPEW
model would not require a comparison of a farmhand to a child-care worker because those two
jobs are not “substantially similar” in terms of all four factors: skill, effort, responsibility, and work-
ing conditions. However, if we evaluated and scored the skill, effort, responsibility, and working
conditions of the two jobs, and then added those four scores for each job to obtain a total value,
we might find that child-care workers score 90 and farmhands 80. Those scores might demon-
strate a systemic bias in how employers fix wages—that a child-care worker earns less than a
farmhand because the former job is female dominated. This example shows how the pay equity
model operates, although usually it entails a comparison of jobs within the same establishment
only. It requires employers to compare not only the same or “substantially similar” jobs, but also
dissimilar jobs that nevertheless produce the same aggregate evaluation scores.
Therefore, the pay equity model is broader in scope than the EPEW model. The pay equity
model (everywhere it is in effect except in the federal jurisdiction, which is a complaint-based
model) also adopts a more proactive enforcement mechanism. Pay equity legislation still per-
mits individual complaints to be filed, but it also imposes on employers a positive, proactive
obligation to achieve pay equity. As always, details vary across jurisdictions, but in general
pay equity legislation in Canada requires an employer (and unions, where present) to take the
following series of proactive steps to achieve pay equity. Legal disputes can arise at any of these
steps, and specialized tribunals may be asked to resolve them.
1. Identify the scope of the pay equity evaluation: The employer must first determine what
units will be included in the pay equity evaluation. Will it be the entirety of the employ-
er’s operations? Or will it be just some parts or units of the employer’s operations, such
as one factory or one office? Usually, the larger the employer, the greater the number of
jobs that can be compared.
2. Identify the “job classes” that will be used in the evaluation: The employer divides the
workplace to be evaluated into “job classes.” Job classes can include a variety of job titles,
provided that the jobs included in the class are similar in terms of duties and required
qualifications or fall within the same salary grade.
3. Identify male- and female-dominated job classes: The employer can usually rely on the
pay equity statute for detailed guidance on identifying male- and female-dominated job
classes. For example, in Ontario the Pay Equity Act defines a job class as female if
60 percent or more employees in that class are female, and male if 70 percent or more
members of that class are male.54
4. Evaluate the job classes: Once the workplace has been divided up into male- and female-
dominated job classes, the employer must assess each job class using a gender neutral
job evaluation system that assigns a score for skill, effort, responsibility, and working
conditions. A total score for each job class is then tabulated.
5. Compare the evaluation scores and search for comparators: The employer reviews the
aggregate scores of male- and female-dominated job classes to identify comparators.
gender neutral job evaluation system: A job evaluation system used in pay equity assessments that measures a job’s skill,
effort, responsibility, and working conditions and that is free of explicit and systemic gender discrimination.
comparator: In pay equity, the male job class to which a female job class is compared and found to be of equal or
comparable value.

A variety of methods are used in the legislation to perform this task. The most straight-
forward is the job-to-job comparison method, which involves comparing the score of a
female-dominated job to a male-dominated job with the same or similar score. However,
sometimes no direct comparator exists for a job class. More complicated is the propor-
tional value method, which involves calculating a “wage line” that tracks the relationship
between job scores and pay rates for male-dominated job classes and then assessing
whether that relationship is the same or comparable for female-dominated job classes.55
A third method, used only in Ontario (in the public sector) and Quebec, is known as the
proxy method of comparison.56 This method applies only when it is not possible to find
a male job comparator for a female-dominated job class using either of the first two
methods. The proxy method requires the employer to compare a female job class with a
male job class at another organization. In Ontario, that organization must be in the public
sector, whereas in Quebec it can be in the public or private sector.
6. Prepare and post a pay equity plan: The employer may be required to prepare and post in
the workplace a pay equity plan that describes the evaluation system used and the results
of the exercise, including any upward adjustments in wages required to achieve pay equity.
7. Make upward pay adjustments to achieve pay equity: Finally, the employer must make
any necessary pay adjustments to female job classes to ensure that their pay rate is the
same as that of comparable, higher-paid male job classes.
Pay equity statutes allow for certain permissible wage differences. Such differences must be
attributable to factors other than gender discrimination, such as seniority systems, merit pay
systems, or temporary labour market shortages that required the employer to inflate wages to
attract qualified employees.57 If an employer can demonstrate that all or part of a wage difference
between a male job class and a female job class is due to a permissible wage difference, then it is
not required to adjust the female job class wages for that difference.
Even this very general overview demonstrates the complexity of pay equity statutes. Experts
are often needed to perform or assist with job evaluations, and when a dispute arises, litigation
is complex and time consuming. A pay equity complaint is heard first by an expert tribunal—
either a human rights tribunal or an even more specialized pay equity tribunal. If either party is
unhappy with the decision, they can seek judicial review (see Chapter 17) by a court. The case
described in Box 18.5 is an extreme example of the complexity of pay equity disputes and of how
these disputes can drag on for years.
Scholars and policy experts continue to debate the extent to which pay equity laws achieve
their objective of eliminating or even reducing systemic discrimination in wages. Ontario’s
Equal Pay Coalition argues that “no other single law in Canada has resulted in such concrete
results for so many working women.”58 Yet others, such as Professors Jan Kainer and Patricia
McDermott (York University), question whether pay equity laws have been successful; they
point to the “complex and unpredictable legal hurdles” in the pay equity model “that may ac-
tually end up resulting in few gains for women.”59 Pay equity provides an example of how work
law—legal signals and legal rules—have great difficulty changing deeply ingrained practices and
norms that have roots outside of the work law subsystem, in broader social and cultural norms,
and in complex labour market divisions and forces.
permissible wage difference: An explanation for a wage difference between a male and female job class that is accepted
as valid and non-discriminatory in a pay equity statute.


The 30-Year-Long Pay Equity Fight at Canada Post
Public Service Alliance of Canada v. Canada Post Corp.
2011 SCC 57
Key Facts: In 1983, the Public Service Alliance of Canada, the

union for a group of Canada Post employees, filed a pay equity
complaint under the Canadian Human Rights Act. It alleged that
the female-dominated job class of clerical and regulatory em-
ployees (CR) was paid less than the comparable male-dominat-
ed class of postal operations employees (PO). A job evaluation
concluded that 34 percent of the CR group had total scores
equal to or greater than the lowest-scoring job in the PO group
when skill, effort, responsibility, and working conditions were
measured. The CR group performed mostly clerical work,
whereas the PO group consisted mostly of mail sorters and
mail carriers. The Human Rights Tribunal ruled in 2005 that the
CR and PO groups were comparable job classes, of equal value,
and that the CR group was paid less than the PO group. It or- Gisele Morneau of Quebec City, one of the original
dered Canada Post to make payments to bring the wages of complainants who filed the pay equity complaint in 1983
the lower-paid CR group up to the wage levels of the PO group. against Canada Post, displays the bottle of champagne she
That decision was appealed to the Federal Court of Appeal, intends to open when she receives her money.
which overturned the tribunal’s decision, and eventually the Source: Jacques Boissinot/GetStock.
case went all the way to the Supreme Court of Canada.
Issue: Did the Human Rights Tribunal err in ruling that Canada Justice Evans wrote that “the resolution of pay equity claims
Post discriminated against employees in the female-dominat- involves a mix of art, science, human rights, and labour rela-
ed CR job class by paying them less than employees in the tions.” Tens of thousands of Canada Post employees were eli-
male-dominated PO job class? gible for the wage adjustments, and the estimated cost of
complying with the tribunal’s order was in the range of $150 to
Decision: No. The tribunal’s decision was upheld, and Canada $250 million.†
Post was ordered to adjust the pay of the employees in the CR
group (both men and women) upward toward that of the PO * You can watch the Supreme Court’s argument and ruling, and read the
group, based on a mathematical formula described in the tri- parties’ written arguments (the factum), by following links on this blog
bunal’s decision. Perhaps in light of the shocking amount of entry: D. Doorey, “Took 30 Years, but Canada Post Employees Win
time this case took to resolve (nearly 30 years!), the Supreme Pay Equity Complaint!” online, Law of Work (blog): <http://lawofwork
.ca/?p=4225>.
Court of Canada issued a rare oral decision immediately after
the appeal had been ordered.* It ruled that Justice Evans, the † V. Lu, “Canada Post Says 10,000 Have Received Pay Equity Cheques,”
dissenting judge in the court of appeal ruling, had gotten it Toronto Star (January 2015), online: <http://www.thestar.com/
business/2015/01/13/canada_post_says_10000_have_received_pay
right, and the Supreme Court adopted his reasons. In his ruling, _equity_cheques.html>.
V. Chapter Summary

This chapter explored the government regulation of wages in Canada and some of the debates
relating to it. Wage laws target compensation levels in pursuit of public policy objectives. Min-
imum wage legislation is intended to tackle poverty and reduce the number of working poor.
Wage freeze or restraint legislation seeks to reduce public spending and fight inflation. Wage
discrimination legislation is a response to the absence of any common law rules prohibiting
discrimination in employment. However, the complexity and range of variables that contribute
to the gender wage gap and the racial wage gap have challenged lawmakers’ efforts to design an

effective legal response. Whether, or to what extent, wage laws achieve their objectives is a mat-
ter of perennial debate.

1. Describe arguments for and against minimum wage laws.
2. Why did Canadian unions initially oppose minimum wage laws for men but not for
women?
3. Why might a Canadian government be more reluctant to impose a wage freeze on its
unionized employees than its non-union employees?
4. Why have some countries attempted to regulate high wages in recent years? If a Canadian
government wanted to introduce a law that regulated high wages, what might such a law
look like?
5. Describe the three types of legal models used in Canada to address gender wage discrimin-
ation. Be sure to identify how they differ from one another in terms of the type of wage
discrimination they govern.
6. What are some factors that might explain why a woman earns less than a man in the same
or similar job other than pay discrimination on the basis of sex?
APPLYING THE LAW

Mark, Jerome, and Jessica all work for Big Apple Grocery Store, cashiers, including scheduling, ensuring breaks are
a large national grocery chain with over 1,000 employees. They covered, authorizing voids, and dealing with other
are non-union employees who were hired at the same time issues that arise at the cash registers. Jerome is head
when the store opened 10 years ago. stocking manager. He earns $30 per hour and also
works a 40-hour workweek. Jerome stocks and orga-
1. Mark is an inventory clerk who is paid $450 per week nizes shelves and also supervises seven other inventory
on a salary for a 24-hour workweek. He is paid biweek- clerks, including scheduling, ensuring breaks are
ly (every two weeks). For the past two weeks, to cover covered, checking and signing off on deliveries of
off vacationing co-workers, Mark worked 35 hours per product, and ensuring the store shelves are clean and
week. His paycheque for those two weeks is the usual neat. Jessica believes it is unfair that Jerome earns so
$900 minus statutory deductions. The minimum wage much more than her because their jobs are “pretty sim-
applicable to Mark’s employment is $15 per hour. Mark ilar” in terms of workload, according to Jessica. Explain
asks you if the employer has complied with the em- to Jessica what she would need to prove if she were to
ployment standards legislation for these two weeks, file an equal pay for equal work complaint. If she won
and if not what he can do about it. What would you tell this argument, what remedy would be ordered? See if
Mark? you can locate the statute and section in the legislation
2. Jessica has the title of head cashier. She earns $20 per of your province that requires equal pay for work of
hour and works a 40-hour workweek. Her job entails equal value. (Hint: it will be in employment standards
working the cash and also supervising the other six or human rights legislation.)
EXERCISE
This chapter noted that locating wage laws can be difficult due to the large number of special
rules and exemptions found in Canadian employment standards statutes and associated regula-
tions. Thankfully, governments have developed numerous wage guides and tools to help
employees and employers understand the legal rules. This exercise uses these sources to help
you answer the following question: When, if ever, can an employer deduct money from an
employee’s pay?
1. Go to a search engine such as Google. Type “deductions from wages” and the province you
are interested in (e.g., “deductions from wages Manitoba”).

2. Look through the search results for an official government website for that province. For
example, in my search, the first result was entitled “Deductions from Wages—Government
of Manitoba.” Go to the official government website you find in your search.
3. Now look for a summary that explains when deductions from wages are permitted.
4. Finally, locate the actual section of the provincial legislation that includes the government’s
rules on deductions from wages. The government website where you found the summary
may include a link to the legislation, but if not, go to the CanLII home page (<https://www
.canlii.org>) and find it. The rules may be located in the main employment standards stat-
ute or in a related regulation. Once you have the statute or regulation on screen, search for
“deductions” in the document. What is the answer to our question?

1. While all human rights statutes in Canada regulate dis- 9. Ontario ESA, s. 5.1.
crimination in employment contracts, some also regulate 10. BC Employment Standards Act, Reg. 396/95, s. 16.
discrimination in contracts generally, including contracts
11. See, for example, Ontario ESA, s. 23.1(ii). Section 14.2 of
for the sale of services by an independent contractor. So, if
the ESA prohibits employers from withholding tips for
a business paid different rates to its independent con-
some purposes, but does not prohibit tip pooling. For a
tractors based on a contractor’s sex, race, skin colour, or
decision discussing when the liquor server exemption
other designated ground in the human rights statute, then
applies, see 1180240 Ontario Inc. (Joey’s Only Seafood)
a human rights complaint could challenge that discrimina-
v. Wilks, 2012 CanLII 52482 (Ont. LRB).
tory practice. See, for example, Human Rights Code, RSO
1990, c. H.19, s. 3. However, when we talk about wage reg- 12. See K. Leslie, “Restaurant Tip Out Policy: Ontario NDP
ulation, we are usually referring to how governments regu- Want Employers to Stop Taking Servers’ Gratuities,”
late the payment of employee wages by employers. online: Huffington Post, October 4, 2013, <http://www
.huffingtonpost.ca/2013/04/11/ndp-ontario-tips-labour
2. See, for example, J. Fudge, E. Tucker, & L. Vosko, “Em-
-law_n_3054337.html>.
ployee or Independent Contractor? Charting the Legal
Significance of the Distinction in Canada” (2003) 10 13. New Brunswick Employment Standards Act, SNB 1982,
CLELJ 193. c. E-7.2, s. 13; and Prince Edward Island Employment
Standards Act, RSPEI 1988, c. E-6.2, s. 17.1.
3. Ontario Employment Standards Act, Reg. 285/01, s. 2. See
also D. Doorey, “This Blog Entry Is about the Lunacy of 14. The book that comes closest to providing a comprehensive
Employment Standards Exemptions,” online, Law of Work summary of all Canadian employment regulation is Can-
(blog): <http://lawofwork.ca/?p=8523>. adian Labour Law Reporter—Employment Standards,
Labour Relations and Labour Law Cases (Markham, ON:
4. Alta. Reg. 14/1997, s. 8.
LexisNexis, 2003). See also G. England, Individual Employ-
5. See, for example, Ontario Employment Standards Act, Reg ment Law, 2nd ed (Toronto: Irwin Law, 2008), chapter 6.
285/01, s. 2
15. M.E. McCallum, “Keeping Women in Their Place: The
6. See, for example, Ontario Employment Standards Act, Minimum Wage in Canada, 1910-25” (1986) 17 Lab 29
2000, SO 2000, c. 41, s. 3(5). at 34.
7. See the discussion in D. Doorey, “Unpaid Intern 16. Cited in J.W. Macmillan, “Minimum Wage Legislation in
Scams Continue to Flourish in Ontario. What Can Be Canada and Its Economic Effects” (1924) 9 Intl Lab Rev
Done?” online, Law of Work (blog): <http://lawofwork 507 at 509.
.ca/?p=6742>; D. Doorey, “Are Unpaid Interns Illegal in
17. Ibid. Although the Alberta Factories Act applied to both
Ontario?” online, Law of Work (blog): <http://lawofwork
men and women, the rate was set so low that in practice it
.ca/?p=2169>; K. Tomlinson, “Bell Accused of Breaking
affected few if any men.
Labour Law with Unpaid Interns,” online: CBC News,
June 24, 2013, <http://www.cbc.ca/news/canada/british 18. McCallum, supra note 15 at 31-33.
-columbia/bell-accused-of-breaking-labour-law-with 19. The British Columbia Men’s Minimum Wage Act was
-unpaid-interns-1.1356277>; and Girex Bancorp Inc. enacted in 1925. Men’s minimum wage laws were enacted
v. Hsieh, 2004 CanLII 24679 (Ont. LRB). in Manitoba and Saskatchewan in 1934, Alberta in 1936,
8. See, for example, Pichette v. Lumac Holdings Ltd., 2011 Ontario and Quebec in 1937, and Prince Edward Island in
CanLII 80536 (NBLEB). 1960.

20. See the discussion on the Government of Canada website, publications/National%20Office/2018/01/Climbing%20

“Labour Program: Minimum Wage Database Introduc- Up%20and%20Kicking%20Down.pdf>.
tion,” <http://srv116.services.gc.ca/dimt-wid/sm-mw/ 32. See the discussion in D. Doorey, “Is It Time to Regulate
intro.aspx?lang=eng>. ‘Maximum’ Pay in Canada?” online, Law of Work (January
21. A number of websites list the provincial and territorial 2012) (blog): <http://lawofwork.ca/?p=4427>.
minimum wage rates. See, for example, Province of Mani- 33. Dodd-Frank Wall Street Reform and Consumer Protection
toba, “Historical Summary of Minimum Wage Rates in Act, 124 Stat. 1376 (2010). Companies began reporting in
Manitoba,” <https://www.gov.mb.ca/labour/standards/ 2018. See A. Edgecliffe-Johnson, “US Companies Reveal
history-min.html>; and D. Clément, “Equality Deferred: Pay Gap Between Bosses and Workers,” Financial Times
The Origins of the Newfoundland Human Rights State” (April 2019), online: <https://www.ft.com/
(2012) 41:1 Acadiensis 102 at 103, <https://journals.lib content/1ee790f0-5da8-11e9-b285-3acd5d43599e>.
.unb.ca/index.php/Acadiensis/article/
34. See, for example, Broader Public Sector Executive Compen-
viewFile/19076/20813>.
sation Act, 2014, SO 2014, c. 13, Sched. 1.
22. R. Morisette & D. Dionne-Simard, “Recent Changes in the
35. Statistics Canada, “The Gender Wage Gap and Equal Pay
Composition of Minimum Wage Workers” (June 13,
Day, 2018,” online: <https://www150.statcan.gc.ca/n1/
2018), online: Statistics Canada <https://www150.statcan
pub/89-28-0001/2018001/article/00010-eng.htm>.
.gc.ca/n1/pub/75-006-x/2018001/article/54974-eng.htm>.
36. X. Zhang, “Earnings of Women With and Without Chil-
23. See the Ontario Employment Standards Act, s. 23.1; and
dren,” Perspectives (March 2009), Statistics Canada, online
Saskatchewan Minimum Wage Regulations, 2014, RRS c.
(pdf): <http://www.statcan.gc.ca/pub/75-001-x/2009103/
S-15.1, Reg. 3.
pdf/10823-eng.pdf>.
24. Anti-Inflation Act, SC 1974-75, c. 75. See the discussion in
37. A. Morrow & C. Alphonso, “Women at Work: Still Behind
C. Nelson, “The Anti-Inflation Act: A Golden Opportunity
on the Bottom Line,” Globe and Mail (August 2012),
for Labour” (1976) 14 Osgoode Hall LJ 727; and D.
online: <https://www.theglobeandmail.com/news/
Morton, Working People, 5th ed (Montreal, QC: McGill-
national/women-at-work-still-behind-on-the-bottom-line/
Queen’s University Press, 1997) at 300-7.
article4389065>.
25. Public Sector Compensation Act, SC 1991, c. 30, s. 5(1.1).
38. S. Block, Ontario’s Growing Gap: The Role of Race and
26. Expenditure Restraint Act, SC 2009, c. 2, s. 393, s. 16. Gender (2010), Canadian Centre for Policy Alternatives,
27. See discussion in Meredith v. Canada (Attorney General), online: <https://www.cwp-csp.ca/resources/resources/
2015 SCC 2. ontarios-growing-gap-role-race-and-gender>.
28. Public Sector Salary Disclosure Act, 1996, SO 1996, c. 1, 39. The Employment Standards Regulations, RRS c. S-15.1,
Sched. A. Reg. 5, s. 3(2). Wage laws that discriminate on a
29. R. Gomez & S. Wald, “When Public-Sector Salaries prohibited ground are susceptible to a section 15 Charter
Become Public Knowledge: Academic Salaries and Ontar- challenge (see Chapter 39). Manitoba and Alberta recently
io’s Public Sector Salary Disclosure Act” (2010) 53:1 Can repealed laws permitting lower wages for disabled workers.
Pub Admin 107. See the discussion in D. Doorey, “Manitoba to Repeal
Two-Tier Law That Allowed Paying Disabled Workers
30. On the harmful effects of income inequality, see D.
Less,” online, Law of Work (blog): <http://lawofwork
Hardoon, Wealth: Having It All and Wanting More
.ca/?p=5950>.
(January 2015), online: OXFAM International <http://
www.oxfam.org/en/research/wealth-having-it-all-and 40. D. Figart & J. Lapidus, “Will Comparable Worth Reduce
-wanting-more>; R. Wilkinson and K. Pickett, The Spirit Race-Based Wage Discrimination?” (1998) 30:3 Rev of
Level (London: Penguin, 2009); M. Lynk, “Labour Law and Radical Pol Econ 14.
the New Inequality” (2010) 15 Just Lab 125; and 41. M. Gunderson, “Discrimination, Equal Pay, and Equal Op-
J. Simpson, “Do We Care That Canada Is an Unequal portunities in the Labour Market,” in W.C. Riddell, ed,
Society?” Globe and Mail (July 2011), online: <https:// Work and Pay: The Canadian Labour Market (Toronto:
www.theglobeandmail.com/opinion/do-we-care University of Toronto Press, 1985); and England, supra
-that-canada-is-an-unequal-society/article587510>. note 14 at 166-85.
31. D. Macdonald, “Climbing Up and Kicking Down: 42. The term occupational crowding was coined by B.R. Berg-
Executive Pay in Canada” (January 2018) at 7, online mann in “Occupational Segregation, Wages, and Profits
(pdf): Canadian Centre for Policy Alternatives <https:// When Employers Discriminate by Race or Sex” (1974) 1 E
www.policyalternatives.ca/sites/default/files/uploads/ Econ J 103.

43. This point is emphasized by critics of pay equity laws: Various Canadian Jurisdictions 2018,” online: <http://
R. Posner, “An Economic Analysis of Sex Discrimination www.payequity.gov.on.ca/en/GWG/Pages/overview
Laws” (1989) 56 U Chicago L Rev 1311. _pe.aspx>. See also England, supra note 14 at 169-85; and
44. K. Brooks, “Valuing Women’s Work in the Home: A Defin- P. McDermott, “Pay Equity in Ontario: A Critical Legal
ing Moment” (2005) 17:1 CJWL 177. Analysis” (1990) 28 Osgoode Hall LJ 381.
45. See the discussion in ibid. and M. Waring, If Women 53. Cited in C. Cuneo, Pay Equity: The Labour-Feminist Chal-
Counted: A New Feminist Economics (San Francisco: lenge (Toronto: Oxford University Press, 1990) at 13.
Harper and Row, 1988). 54. Pay Equity Act, RSO 1990, c. P.7, s. 1.
46. Brooks, supra note 44; Morris v. Budnarchuk, 1998 ABCA 55. Ontario’s Pay Equity Commission has developed a propor-
390; and Fobel v. Dean, 1991 CanLII 3965 (Sask. CA). tional value tool to help employers use this method. See
47. Ontario’s Pay Equity Commission has written that “statisti- Pay Equity Commission, “Tool: Regression Line Calcula-
cians estimate that as much as 10 to 15% of the gender wag tor: Proportional Value Method,” online: <http://www
gap is due to discrimination.” See Pay Equity Commission, .payequity.gov.on.ca/en/tools/Pages/proportional_
“What Is the Gender Wage Gap?” online: <http://www calculator.aspx>.
.payequity.gov.on.ca/en/GWG/Pages/what_is_GWG.aspx>. 56. For a history and explanation of the Ontario proxy model,
48. See J. Fudge & P. McDermott, “Conclusion: Pay Equity in a see Pay Equity Commission, “Proxy Comparison Method,”
Declining Economy: The Challenge Ahead,” in J. Fudge & online: <http://www.payequity.gov.on.ca/en/tools/Pages/
P. McDermott, eds, Just Wages: A Feminist Assessment of guide_to_act11.aspx>. Note that the proxy model was
Pay Equity (Toronto: University of Toronto Press, 1991) repealed in 1996 by the Ontario Conservative Party, but an
281 at 283: “Pay equity is not designed to close the entire Ontario court ruled in 1997 that the repeal violated s. 15 of
wage gap; rather, it is designed to reduce that part of the the Charter, the equality section. See Service Employees
gender wage gap that is attributable to the systemic under- International Union, Local 204 v. Ontario (Attorney
valuation of women’s work.” General), 1997 CanLII 12286 (Ont. Gen Div).
49. See, for example, Alberta Human Rights Act, RSA 2000, 57. See, for example, Pay Equity Act, RSO 1990, c. P.7, s. 8.
c. A-25.5, s. 6; and Employment Standards Act, 2000, SO 58. Equal Pay Coalition, “History of Pay Equity Advocacy in
2000, c. 41, s. 42. In British Columbia, the Human Rights Ontario,” online: <http://equalpaycoalition.org/history-of
Code, RSBC 1996, c. 210, s. 12, lists only skill, effort, and -pay-equity-advocacy-in-ontario>. See also P. Singh &
responsibility (not working conditions). P. Peng, “Canada’s Bold Experiment with Pay Equity”
50. Human Rights Code, supra note 49, s. 12(3). (2010) 25 Gender in Mgmt 570.
51. M. Gunderson, “Spline Function Estimates of the Impact 59. J. Kainer & P. McDermott, “Pay Equity in the Sky” (2004)
of Equal Pay Legislation: The Ontario Experience” (1985) 23 Can Woman Stud 78 at 78; and K. England & G. Gad,
40 Indus Rel 775; and England, supra note 14 at 169. “Social Policy at Work? Equality and Equity in Women’s
Paid Employment in Canada” (2002) 56 GeoJournal 281.
52. A good summary of pay equity laws in Canada appears in
Pay Equity Commission, “An Overview of Pay Equity in


C H A P T E R 19
Regulating Hours of Work,

Time Off, and Overtime
II. A (Very) Brief History of Working Time Laws in Canada 306
• Describe the origins of working time regulation in Canada.
III. The Justifications for and Limitations of Contemporary Working
• Discuss the policy objectives that drive working time regulation. Time Regulation 308
• Describe the basic legal approach to hours of work regulation, overtime IV. Contemporary Working Time Regulation in Canada 309
pay, statutory holidays, paid time off, and statutory leave entitlements A. Hours of Work and Overtime Pay 309
in Canada. B. Statutory Holidays, Paid Time Off (Vacation Pay), and Food
Breaks 313
C. Leaves of Absence 316
I. Introduction
We could leave the setting of working time purely to market forces. Employers and employees
could bargain hours of work and the right to take occasional leaves of absence, and the state
could stay out of it. That is what the neoclassical perspective (see Chapter 3) argues should hap-
pen. Yet that is not the approach taken in Canada. The old master and servant law (see Chapter
5) conferred on “masters” almost complete control over their “servants” lives, including when
they would work, rest, and play. The industrialization of the Canadian economy in the late 19th
century and the accompanying transition from master and servant law to the common law of
the employment contract precipitated some of the greatest labour battles of the 20th century, as
workers sought to gain greater control over their working hours.
Regulating working time involves persistent challenges because it engages so many compet-
ing interests. Employers want flexibility and the ability to assign longer hours when needed to
meet business deadlines, without incurring large labour costs. Employees want to work enough
hours to earn a decent standard of living for themselves and their families, but not so many
hours that they never get to see those families or have too little time for rest, sleep, and some
fun. Governments are concerned with encouraging a distribution of available work among the
population that produces optimal employment levels, including low unemployment rates. How
best to use legal rules to achieve a sensible balance between all of these competing interests is
one of the biggest issues in the law of work. This chapter explores this issue and the ways in
which Canadian governments have responded to it.
305

II. A (Very) Brief History of Working Time Laws in Canada

Like much of the story of employment regulation in Canada, hours of work regulation followed
on the heels of improvements bargained by unions for their members. Unions first bargained
reduced hours, vacations, leaves, and paid holidays into their collective agreements and then,
eventually, governments enacted hours of work legislation of more general application.1
Throughout the 1800s, many employees worked 12- to 16-hour days, sometimes seven days a
week. Canadian workers in early unions went on strike in the 1830s, seeking a standard ten-
hour workday. As the Canadian economy industrialized in the late 19th century, union-led
Nine-Hour Leagues formed to pressure employers and governments to introduce a nine-hour
workday. That demand by the Typographical Union at the Toronto Globe newspaper in 1872 led
to one of the most important labour strikes in Canadian history.2 The Globe’s editor, George
Brown, refused the shorter workweek and charged the union leaders with criminal conspiracy.
A mass public protest in support of the strikers marched through Toronto’s streets that year,
starting an annual tradition that continued until 1894, the year that Labour Day was formally
recognized as a national holiday.3
As the result of the 1872 Printers’ Strike, the Trade Union Act was passed, which
established the legality of labour organizations.
Nine-Hour Leagues: Organizations active in the late 19th century that attempted to pressure and persuade employers and
governments to implement a mandatory maximum nine-hour workday.

Chapter 19 Regulating Hours of Work, Time Off, and Overtime 307
Professors Eric Tucker and Judy Fudge described the guiding philosophy of Canadian gov-
ernments of the 19th and early 20th century as “liberal voluntarism,” a belief that governments
should intervene only minimally in the operation of labour markets.4 Women and children were
considered special cases. They were perceived to be particularly vulnerable to market-based
exploitation because they were unlikely to join unions. Moreover, women’s reproductive role in
society was thought to require state protection, including protection from long working hours.
As well, cheap female labour threatened higher male union wages.5 For these reasons, the late
19th-century Factories Acts enacted in Ontario and Quebec fixed maximum hours of work for
women and children at 60 hours per week and ten hours per day. Legislators gave male workers
the odd day off: the 1906 federal Lord’s Day Act declared Sundays a day of rest, and by the 1920s
some provinces had begun to legislate mandatory days off from work, such as the descriptively
named One Day’s Rest in Seven Act of Ontario.
However, it would be decades later before governments regulated men’s working hours. In
1919, the Royal Commission on Industrial Relations observed high levels of worker discontent
with long working hours and recommended an eight-hour day. That recommendation was con-
sistent with an important convention of the newly formed International Labour Organization
(ILO): the Hours of Work (Industry) Convention (1919), which encouraged governments to
legislate an eight-hour day and a 48-hour week (see Chapter 27).6 By the 1920s, full-time Can-
adian employees worked an average of 48 to 56 hours per week.7 However, an eight-hour work-
day was already common in the unionized skilled trades.8 Although Canada did not ratify the
ILO’s Hours of Work (Industry) Convention until 1935, in 1923 the BC government enacted
legislation implementing the ILO’s core recommendation of an eight-hour workday and a
48-hour workweek for non-managerial employees in industrial workplaces, the first Canadian
province to do so.9
The effects of the Great Depression of the 1930s overtook much of the momentum toward
working time legislation. However, during World War II and in its aftermath, Canadian govern-
ments moved to restrict working time in a number of ways. Ontario’s Hours of Work and Vaca-
tions with Pay Act of 1944 exemplified this development.10 That act, like the earlier BC
legislation, introduced a standard eight-hour workday and a 48-hour workweek to sectors of the
economy that were already heavily unionized. The Ontario government explained that the hours
of work rules reflected those already bargained for by unions in those sectors and were intended
to “spread employment over a greater number of employees and also to prohibit an employer
from requiring his employees to work excessive hours.”11 The new idea of mandatory paid vaca-
tion spread to other provinces thereafter.
In 1965, the federal government consolidated several existing statutes into the Canada
Labour (Standards) Code, which provided for a standard 40-hour workweek, an eight-hour
workday, and mandatory overtime pay at a rate of 1.5 times the regular rate for hours worked
above the standard. The code also included eight statutory holidays. Again, the idea of statutory
holidays reflected provisions that unions had bargained into collective agreements for years.
Over time, and to this day, the standard workweek has varied from province to province, rang-
ing from 40 to 48 hours per week.
Statutory leaves of absence prohibit employers from dismissing employees who take time off
work for reasons the state feels deserving of protection; they also require that the employers
reinstate the employees to their previous job once the leave is over. The leaves are unpaid, but
ratify: A term used to describe the process in which a national government endorses and agrees to implement into its legal
system the requirements of an international legal convention or other legal instrument.
overtime pay: A premium above the normal wage rate of an employee that must be paid for every hour worked above the
threshold of standard working hours. The premium is usually 1.5 times the normal wage rate, but sometimes it is higher than that.

over time the federal government has amended employment insurance laws to permit workers
to claim employment insurance benefits during some periods of leave (maternity and parental).
In this way the costs of statutory leaves are publicly funded rather than imposed on individual
employers.12 As discussed later in the chapter, maternity leave came first (originally in British
Columbia in 1921), followed by parental leave protections, and then a list of other leaves to deal
with a variety of situations governments have felt deserving of protection, including leaves for
bereavement, jury duty, family care or responsibility, compassionate care, emergencies, and
military reserve service. The details of these laws vary, but all involve a right to unpaid leave
from work without reprisals for a designated period of time.
III. The Justifications for and Limitations of Contemporary Working

Time Regulation
From this brief history, it is possible to identify common justifications for working time regula-
tion.13 First, maximum hours of work laws are part of the government’s pursuit to make the lives
of working people safer and healthier. Long working hours are associated with greater incidence
of workplace accidents, higher stress, poorer physical health, and a less cohesive family life.14
Second, governments have used working time regulation and overtime pay rules to fight
unemployment: by limiting working hours and imposing a financial penalty (overtime pay) on
employers for assigning long hours, the intention is to encourage employers to hire more work-
ers rather than retain fewer workers who work long hours.15 Third, working time regulation is
a tool by which governments seek to balance competing social and economic values. Govern-
ments want efficient and flexible labour markets that will attract and benefit employers, but also
recognize the need to ensure people can balance work with other valuable activities, such as
caring for children and the infirm, enjoying leisure time, and performing important civic duties,
such as jury duty and military service.
The contemporary Canadian labour market produces difficult policy challenges for working
time regulation. On the one hand, many workers complain about working too many hours.16
These workers want more leisure/family time, but the demands of their job or fears of employer
reprisals leave them unable to cut back. On the other hand, millions of Canadians are underem-
ployed or precarious workers who work part-time or temporary jobs, who perform unpaid
work, or who are self-employed and want more work. Many of these workers piece together
multiple low-wage jobs just to get by. Studies indicate that this division is not gender, age, or race
neutral. Proportionately, more middle-aged white men fall into the former category (long hours
in full-time jobs), and more women, youth, and racialized minorities fall into the latter category
(too few working hours).17 Then there are the unemployed—people who want paid employment
but cannot find it (the unemployment rate has hovered between approximately 5 and 9 percent
in the past decade).
Lawmakers are aware of this problem of work distribution, and many of the legal rules we
discuss in this chapter are intended, at least in part, to address it. The extent to which those legal
rules achieve this goal is debatable. Recall that employment standards legislation applies to
employment contracts only (see Chapter 2). A concerning trend in recent years is the reclassi-
fication by businesses of workers from employee status to non-employee status (i.e., independent
contractor or “self-employed”) to avoid employment-related laws, including working time laws.
A study by the Organisation for Economic Co-operation and Development (OECD) found that
25 percent of the increase in income inequality in Canada over the past 30 years is due to the
rise in “self-employment,” since the self-employed generally earn less than the employed.18
precarious worker: A worker whose labour market participation is characterized by low pay, job insecurity, lack of job tenure,
or multiple part-time or temporary jobs.
income inequality: A measure of the extent to which income in a country is unevenly distributed.

Many self-employed workers today are really “disguised employees” in the sense that they tend
to be completely dependent on the work provided to them by one “customer” and lack the usual
traits of entrepreneurs.19 Yet that disguise may oust them from regulatory coverage if the defin-
ition of employee in the statute is narrowly applied.
IV. Contemporary Working Time Regulation in Canada

The precise details of working time regulation in all of Canada’s jurisdictions are far too diverse
and complex to recount in detail here. Our mission is to paint in broad strokes the general
approach taken in Canada to balancing work and leisure time. This section summarizes the
main components of that strategy.
A. Hours of Work and Overtime Pay

Every Canadian jurisdiction attempts to control working hours in some manner. Three primary
approaches are used, as summarized in Table 19.1. The “market-based approach” does not
impose a hard cap on the number of hours an employee can work, but discourages long hours
by requiring employers to pay a premium (overtime pay) at a higher rate than the usual pay rate
to employees who have exceeded the standard working hours threshold fixed by the govern-
ment.20 The standard working hours threshold can be either a daily or weekly number of hours
(or both), and that threshold varies across the country. For example, in British Columbia and
Manitoba, employers must pay the overtime rate after an employee works eight hours per day
or 40 hours per week, in Ontario after 44 hours in a week, and in Nova Scotia, overtime pay is
not triggered until an employee works more than 48 hours per week.21 The overtime rate is usu-
ally 1.5 times the regular hourly rate of pay (“time and a half ”), although in some situations in
some provinces it rises to 2 times the regular rate.22
TABLE 19.1 Methods of Regulating Hours of Work

Market-Based The law defines a number of hours in a “standard” workday or workweek and then requires
Approach the employer to pay a premium (overtime pay) for every hour worked above the standard.
No maximum hours of work is legislated, but the law requires mandatory time off between
shifts or weekly rest periods.
Regulatory The law requires the employer to pay a premium (overtime pay) above a defined number of
Approach hours in a day or week, and in addition fixes a maximum number of hours the employee can
work in a day or week.
Averaging The law permits an employee and employer to agree to average out the number of hours
Agreements worked over a defined period of time (i.e., two weeks), and overtime pay at a premium is
only payable when the average number of hours worked in a week over the period is greater
than the threshold number of hours required to qualify for overtime pay.
Although in the “market-based approach” there is not maximum hours of work imposed, the
law prevents employers from working employees 24 hours a day by requiring mandatory time
off from work between shifts or over the course of week. For example, in British Columbia,
employees are entitled to at least eight consecutive hours free from work between shifts and 32
hours off per week.23 In Newfoundland and Labrador, overtime is payable after 40 hours per
week and employees must be given at least eight consecutive hours off per day and 24 hours off
per week.24 Effectively, that could mean a work day of 16 hours and a six-day workweek, which
sounds a lot like 19th-century hours!
standard working hours: The number of working hours in a day or week after which overtime pay is required, as defined
in an employment standards law.
mandatory time off: A provision in employment standards legislation requiring that employees be given a specified amount
of time off work in a day or week.

The “regulatory approach” also requires employers to pay employees overtime pay after they
have worked a defined number of hours, but in addition it includes a fixed cap on the number
of hours that can be worked per day or week. For example, in Ontario, while overtime is payable
after 44 hours worked per week, the Employment Standards Act, 2000 also caps the number of
hours an employee can be required to work per week at 48 hours. In Alberta, 12 hours is the
maximum workday. Exceptions exist to all of these rules, which makes hours of work legislation
complicated to apply in practice. Also, employers and employees can usually agree that paid
time off will be given in lieu of overtime pay, calculated as one and half hours of paid time off
for each hour of overtime worked.25
An interesting question that sometimes arises in applying hours of work and overtime pay
requirements is whether an employer must pay overtime pay for overtime hours worked in
contravention of a workplace rule that employees receive prior approval to work overtime. This
issue is critical in a series of class action lawsuits filed recently by bank tellers against some of
Canada’s largest chartered banks, including Scotiabank and Canadian Imperial Bank of Com-
merce (CIBC), alleging millions of dollars in unpaid overtime pay. The banks defended the
actions by arguing, among other things, that the overtime work was unauthorized and contrary
to the banks’ policy of requiring pre-approval for overtime work.
Scotiabank recently settled a claim by employees for unpaid overtime by agreeing to pay out up to $95 million
in payments to the employees.
class action: A lawsuit in which a group of people join together and act as one common plaintiff on the basis that they all
allege to have suffered the identical or a similar legal wrong at the hands of the same defendant. A class action must be ap-
proved by a court before it can proceed.

The Canada Labour Code, which applies to banks, says that overtime pay is payable if an em-
ployee is “required or permitted” to work more than the standard hours.26 In the CIBC litiga-
tion, the Ontario Court of Appeal wrote in a preliminary decision, without yet deciding the
issue, that it is “arguable that the pre-approval requirement in CIBC’s Current Policy served as
an institutional impediment to claims for overtime that would otherwise have been compen-
sable” under the code.27 Scotiabank recently settled its case by agreeing to pay upwards of $95
million in damages for unpaid overtime.28 Some jurisdictions, like Ontario, have legislated a
clearer answer to the problem of whether overtime pay can be conditioned on the employer’s
pre-approval, as explained in the decision in Box 19.1.

Must an Employer Pre-Approve Overtime Work for Overtime Pay to Be Owing?
TCS Express Inc. v. Yasin ESA then clarify when an employee is deemed to have per-
2006 CanLII 19423 (Ont. LRB) formed work. Section 6 (now s. 1.1) of Regulation 285/01
provides the following guidance:
Key Facts: Yasin was hired as a customer service representative
on a salary of $1,800 per month. Her regular hours were 9 a.m. 6. … work shall be deemed to be performed by
to 6 p.m., Monday to Friday, but in practice she worked varied an employee for the employer,
hours and her time cards indicated that she had worked close (a) where work is (i) permitted … to be done by
to 90 hours of overtime in her nine months of employment. the employer, or (ii) in fact performed by an em-
However, the employer argued that its policy prohibited over- ployee although a term of the contract of em-
time unless it was pre-approved by a manager. Yasin’s manager ployment expressly forbids or limits hours of
had approved only 3.5 hours of overtime pay. Yasin filed a work or requires the employer to authorize hours
complaint under the Employment Standards Act seeking pay- of work in advance; …
ment for the remaining overtime hours worked.
According to the OLRB, this section “deems whatever work
Issue: Is Yasin entitled to overtime pay for overtime hours
Yasin did for TCS to be work performed,” even if TCS had not
worked that had not been pre-authorized by the employer?
granted pre-authorization for Yasin to work the hours. The
Decision: Yes. The Ontario Labour Relations Board (OLRB) OLRB concluded that TCS could discipline Yasin for working
ruled that the legislation provided a “complete answer.” The unauthorized hours, but once the hours have been worked, it
ESA requires that overtime pay be paid to an employee who could not refuse to pay her. The employer was ordered to pay
works greater than 44 hours in a week. The Regulations to the Yasin the outstanding amount of overtime owed.
The third approach to regulating hours of work and overtime pay involves the use of averag-
ing agreements, which are now permitted in most Canadian jurisdictions (but not in Quebec,
Newfoundland and Labrador, or Prince Edward Island). The details of averaging agreement
schemes vary by jurisdiction. In general terms, the averaging agreement approach can operate
in tandem with either the market-based or regulatory approach, but it adds a new element of
flexibility, essentially allowing the parties to contract out of the general rule on payment of
overtime. An averaging agreement is an agreement between an employer and employee to
average out the number of hours worked over a longer period than the standard workweek. The
usual purpose of an averaging agreement is to avoid the payment of overtime pay when an em-
ployee works sporadic hours over multiple weeks. To demonstrate, consider the following
example:
Jean works 50 hours in week one and only 24 hours in week two. He works in a province in which
overtime is payable after 44 hours worked per week. Therefore, he would normally be entitled to six
averaging agreement: A legislative device designed to facilitate flexibility in the calculation of an employee’s entitlement
to overtime pay. An averaging agreement permits an employer and employee to agree to average hours worked over a period
longer than the standard period of time used to calculate overtime pay entitlement.

hours’ overtime pay in week one and zero overtime pay in week two. However, he entered into an
averaging agreement with his employer that provides that hours would be averaged over a two-week
period. The average hours worked per week is 37 (74 / 2), and since 37 is less than 44, Jean is not
entitled to overtime pay.
Proponents of averaging agreements argue that the flexibility they introduce benefits employ-
ers and employees alike. Employees sometimes want variable hours, and averaging agreements
allow them to work additional hours during some weeks in exchange for more leisure time in
other weeks without imposing a financial burden on the employer. Employers obviously benefit
from the reduction in overtime pay required when working hours vary widely from week to
week. However, averaging agreements also introduce the potential for employers to exploit their
position of power to avoid overtime pay requirements. Although averaging agreements require
employee consent, in practice many employees may be afraid to refuse their employer’s request
for an averaging agreement for fear of irritating their boss. In an effort to protect employees
from feeling compelled to sign averaging agreements, such agreements have sometimes been
made conditional on government approval.29
A maddening feature of Canadian hours of work and overtime pay law—similar to wage
regulation discussed in the preceding chapter—is the large number of exemptions and special
rules. Many occupations are excluded from the legal rules altogether, such as certain professions
and agricultural workers. Some occupations are excluded from a few of the legal rules. In
Ontario, for example, a person employed in a job related to mushroom growing is excluded from
both maximum hours of work and overtime pay provisions, but a person employed in landscape
gardening or pool maintenance is excluded only from overtime pay requirements!30 In some
cases, it is also possible for an employer to obtain government consent to entirely avoid compli-
ance with hours of work and overtime law or to enter into an agreement with the employee to
waive certain employment standards in whole or in part.31
A popular misconception is that salaried employees are not entitled to overtime pay, the
assumption being that the salary includes payment for all hours worked. That is false. Employ-
ment standards rules apply equally to salaried and hourly employees. Canadian employment
standards laws do often exempt “managers” from some statutory protections, including hours of
work and overtime pay requirements. “True” managerial employees, who have effective power to
hire, fire, discipline, or control budgets, are presumed to be an arm of the employer and to be paid
at a level that recognizes the potential for longer hours. However, it is important to pay close
attention to the language in the statute that defines the “managerial exemption.” The managerial
exception is much narrower than most people appreciate. For example, in British Columbia, a
“manager” is not covered by hours of work and overtime laws.
“Manager” is defined as
(a) a person whose principal employment responsibil-

ities consist of supervising or directing, or both
supervising and directing, human or other re-
sources, or
(b) a person employed in an executive capacity.32
Applying this definition, it is not enough that the employee

has some supervisory powers; supervision must be the
employee’s “principal” responsibility.33 Ontario’s legislation
similarly defines the “managerial exclusion” narrowly, as the
decision described in Box 19.2 illustrates, a case that also
serves as a useful reminder that a person’s job title is not deter-
minative of whether someone is a “manager” in a legal sense.34


Overtime Pay and the Managerial Exclusion
1748271 Ontario Inc. v. Patterson the managerial exemption from hours of work and overtime
2015 CanLII 26117 (Ont. LRB) pay entitlements: (1) that the employee’s work is supervisory
and managerial in character; and (2) that the person performs
Key Facts: Patterson worked initially as a customer retention non-supervisory or non-managerial tasks only on an irregular
specialist (CRS) at a small furniture and appliance store, but or exceptional basis, if at all. Although Patterson held the
was later promoted to the position of store manager when the position of store manager and was responsible for running
existing manager took a leave of absence. Patterson claimed the store, in practice the store was so small (only 4 or 5 em-
overtime pay, but the employer argued that the store manager ployees) that Patterson was required to perform non-mana-
was a manager in the truest sense of the word—the store gerial and non-supervisory tasks regularly. At least one day
manager essentially “runs the store in every respect.” per week he was the only person at the store, and on those
days he was required to deal with any customer who came
Issue: Is Patterson exempted from the entitlement to overtime
into the store. He also continued to perform duties associated
pay because he exercises managerial functions?
with his old CRS job. Therefore, Patterson’s performance of
Decision: No, Patterson is entitled to overtime pay. The OLRB non-supervisory and non-managerial tasks was regular and
explained that an employer needs to demonstrate two re- non-exceptional.
quirements in order to establish that an employee falls within
B. Statutory Holidays, Paid Time Off (Vacation Pay), and Food Breaks
All Canadian jurisdictions designate a list of dates as statutory holidays on which employees
must either be given the day off work or be paid at a premium rate if they do work. Some holi-
days are grounded in the Christian roots of the early English and French settlers, such as Christ-
mas Day, Good Friday, and Easter Monday. Others celebrate key moments in Canadian, British,
or French history, such as Labour Day, Canada Day, Remembrance Day, Quebec’s Journée
nationale des patriotes, and Victoria Day. Some holidays, like Civic Holiday and Family Day,
celebrate little more than a day off work (for many) to rest and hang out with friends and family.
Table 19.2 lists Canada’s statutory holidays. Statutory holidays are immensely popular with
workers. However, proponents of the neoclassical perspective (see Chapter 3) and many
employer-based organizations (e.g., the Retail Council of Canada, chambers of commerce)
routinely argue against them on the basis that statutory holidays impose costs on employers with
no corresponding productivity increase.35
The details of the statutory holiday provisions and the conditions under which an employee
qualifies vary across jurisdictions. Generally, the laws assume that most employees will get the
day off work but still be paid their usual daily rate. The intention of the holiday pay laws is to
encourage employers to shut down for the day, or at least minimize the number of employees
scheduled that day. However, some employers want to open on a holiday and, therefore, employ-
ees and employers are permitted to agree that the employee will work but be paid a premium
rate, sometimes up to as much as 2.5 times the regular hourly rate of pay.36 Sometimes, employ-
ees and employers are permitted to agree that when an employee works on a statutory holiday,
that employee will receive another paid day off in the future.
statutory holiday: A day designated in employment standards legislation on which employees are entitled to receive either
time off with pay or a wage premium if they work.

TABLE 19.2 Canada’s Statutory Holidays
Remembrance Day
New Year’s Day
Easter Monday
Christmas Day
Thanksgiving
Civic Holiday
Good Friday
Victoria Day
Canada Day
Labour Day
Boxing Day
Family Day
Other
Federal (9) ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Alberta (9) ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
British Columbia (10) ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ • British Columbia Day
Manitoba (8) ✓ ✓ ✓ ✓ ✓ ✓ ✓ • Louis Riel Day
New Brunswick (7) ✓ ✓ ✓ ✓ ✓ ✓ • New Brunswick Day
Newfoundland and Labrador (6) ✓ ✓ ✓ ✓ ✓ ✓

Northwest Territories (10) ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ • National Aboriginal Day
Nova Scotia (6) ✓ ✓ ✓ ✓ ✓ • Nova Scotia Heritage Day
Nunavut (12) ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ • Nunavut Day
Ontario (9) ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Prince Edward Island (7) ✓ ✓ ✓ ✓ ✓ ✓ • Islander Day
• Journée nationale des patriotes

Quebec (8) ✓ ✓* ✓* ✓ ✓ ✓ ✓ • Fête nationale du Québec
Saskatchewan (10) ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ • Saskatchewan Day
Yukon (9) ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ • Discovery Day
* In Quebec, either Good Friday or Easter Monday must be treated by the employer as a statutory holiday.
Ontario was the first province to introduce mandatory paid vacation, in 1944, and over the
next two decades the other jurisdictions followed. The legal rights to statutory vacation time
and statutory vacation pay are separate but related entitlements. Statutory vacation time refers
to the amount of time an employee is legally entitled to take off work during a year. Again, the
details vary, but generally the laws require employers to provide employees with a specified
amount of paid time off work in a year. Two weeks’ vacation is a common standard, although
relatively new employees are sometimes excluded, and in some provinces paid vacation time
increases to three or four weeks after a certain period of service, such as five or ten years.37 Statu-
tory vacation pay refers to the amount of pay a vacationing employee is legally entitled to receive
while taking vacation time. That amount is usually calculated according to a formula designed
to approximate the employee’s average weekly pay, such as 4 to 6 percent of the employee’s gross
annual pay.38
statutory vacation time: The amount of time an employee is legally entitled to take off work during a year.
statutory vacation pay: The amount of pay a vacationing employee is legally entitled to receive while taking vacation time.

A 2013 study by the Center for Economic and Policy Research found that Canada (using the
federal legal model) ranked third last among nations within the OECD in terms of the amount
of paid time off workers receive (see Box 19.3).39 European nations are most generous with em-
ployee time off. The United States, where the neoclassical perspective is most influential, is the
outlier—it guarantees its workers no paid time off. Most jurisdictions in Canada permit employ-
ees to waive their vacation time, and a Canadian study based on 2010 data found that about
36 percent of full-time Canadian workers do not use their full statutory vacation time, and
19.3 percent use none of it at all.40

Canada Lags Behind Most Western Nations on Paid Time Off
According to a 2013 study by the Center for Economic and shows the paid holidays and paid vacation of the OECD’s
Policy Research, Canada has not kept pace with most of the wealthiest nations. The Canadian figures are based on federal
Western world in terms of the number of legislated holidays entitlements in the Canada Labour Code.
and paid vacation it guarantees employees. The chart below
40
Paid Holidays
35 Statutory Minimum Annual Leave

1
30
Number of Working Days
30 0
28 13 2 0 0 0
25 10
25 25 25 25 25
24 13 12
20 22 22 11 10 10 9 8 6 0 0
20 20 20 20 20 20 20 20
15
9 0 0
10
10 10 0
5
0
e a y n d k y l n d y a e d s a n s
nc om stri wa de lan ar an uga Spai alan Ital lgium land trali reec rlan land nad apa tate
Fra ingd Au Nor Swe Fin enm erm Port Ze B e Ire Aus G itze her Ca J dS
K D G w t ite
ite
d Ne Sw Ne Un
Un
Source: Center for Economic and Policy Research, Washington, DC, <http://wwwcepr.net>.

Finally (and briefly), Canadian employment standards legislation also requires employers to
provide employees with a break (usually of at least a half hour) when they can rest and eat, usu-
ally at a time that will ensure the employee does not work more than five hours without taking
a break.41
C. Leaves of Absence

A statutory leave grants an employee a defined period of time off work, without pay, and
requires that the employer save the employee’s job until they return, provided the employee
returns within the allowed time period.42
British Columbia’s Maternity Protection Act of 1921 was Canada’s first legislation granting
maternity leave.43 It granted the right to employees to take six weeks off after giving birth. Most
other jurisdictions waited to follow British Columbia’s lead until the 1970s, in tandem with a
significant expansion of female labour force participation that began in the 1960s.44 The details
of the various contemporary Canadian maternity laws vary, but generally they require employ-
ers to grant a pregnant employee a leave from work without pay ranging from 15 weeks
(Alberta) to 18 weeks (British Columbia, Quebec, and Saskatchewan), with most jurisdictions
requiring 17 weeks. Statutory rules specify when leaves may begin, usually based on a period of
time before the due date and extending to a period after the birth, and in some provinces the
employee must have worked a minimum period of time in order to qualify.45
We noted in Chapter 17 that the Constitution grants the federal government jurisdiction over
unemployment insurance. The federal government has used that power to provide funding for
some workers who take statutory maternity or parental leave (see the online chapter “Regulat-
ing Unemployment”). Employment standards legislation grants employees the right to take
leave without reprisals, and the federal employment insurance scheme provides eligible workers
with a source of income during the leave.46 In 1990, paid parental leave benefits were introduced
for up to 10 weeks at a rate of 55 percent of the employee’s regular earnings, which could be
taken by one parent or split between both. In 2019, paid parental benefits available under the
Employment Insurance Act are available for either 40 weeks based on a benefit rate of 55 percent
or 69 weeks based on a lower rate of 33 percent.47
Many other types of leave are recognized in Canadian law. Each type functions in a similar
manner, although the details vary in terms of eligibility requirements and duration. The follow-
ing protected leaves are recognized in some or all Canadian jurisdictions:
• Family medical, family caregiver, and critically ill child leaves to care for critically or ser-
iously ill family members.
• Organ donor leave to undergo and recover from surgery due to an organ donation.
• Bereavement leave to attend funerals or be with family when an immediate family mem-
ber dies.
• Crime-related child death or disappearance leave to allow a parent to recover from the
trauma of a crime-related death or disappearance of a child.
maternity leave: A statutory rule requiring an employer to grant a pregnant woman time off from work without pay in the
weeks immediately before or after giving birth (also known as pregnancy leave).
parental leave: A statutory rule that requires an employer to grant the parents of a newborn or newly adopted child a period
of time off work without pay to care for the child.
parental benefits: A rule in employment insurance legislation that entitles new parents to receive benefits (financial assist-
ance) while caring for a newborn or newly adopted child.

• Personal emergency leave to deal with select, sudden, and defined personal
emergencies.
• Sick leave to recover from short-term illnesses.
• Reservist leave to permit an employee enlisted in a military reserve to attend to reservist
responsibilities.
V. Chapter Summary

This chapter described the extensive scope of legal intervention into working hours in Canada.
Modern working time legislation is deeply tied to its historical roots and the struggles of work-
ers and unions to win back from employers greater control over their non-working lives. For
governments, complex and sometimes competing policy objectives drive the design of working
time regulation. On the one hand, governments want employers to have flexibility to respond to
economic contingencies. On the other hand, governments are aware that economic and social
benefits are associated with avoiding very long working hours. The laws described in this chap-
ter reflect governments’ attempts to strike a balance between these competing concerns.

1. Describe the market-based approach and the regulatory approach to regulating working
time in Canada.
2. What is an averaging agreement? Describe one argument in favour of and one against a
law permitting averaging agreements.
3. Explain the difference between statutory vacation time, statutory vacation pay, and a statu-
tory holiday.
4. Is an employee who has just given birth entitled to time off with pay in Canada? Explain
your answer.
5. What competing policy objectives are Canadian governments balancing when they enact
working time legislation?
APPLYING THE LAW

1. Agnus worked 35 hours two weeks ago and 50 hours “assistant food manager” and the employer told him
last week in her job at McDonald’s. In the province managers do not get overtime pay. Jim’s job entails
where she works, overtime pay is required for every scheduling the kitchen staff and ensuring that the
hour worked above 44 in a week, and there is no maxi- kitchen runs efficiently, so he spends much of his time
mum number of hours permitted per week. She is paid supervising the cooks. He has the power to hire kitchen
$16 per hour. staff, and his comments about employees to the store
a. How much overtime pay is Agnus entitled to under manager has on one occasion led to a cook being ter-
this scenario? minated. When the store is busy, Jim helps prepare
b. Now assume that Agnus had entered into an aver- food. This happens at least twice per shift, including
aging agreement with McDonald’s that required around lunch and dinner rushes.
working hours to be averaged over a period of two
weeks. How much overtime is Agnus entitled to Using the CanLII website (<https://www.canlii.org>), locate the
under this scenario? language in the employment standards legislation or regula-
2. Jim works alongside Agnus at the same McDonald’s. tion in your province that explains whether managers are ex-
Jim worked the same amount of hours over the past cluded from receiving overtime pay. Considering that language,
two weeks as Agnus. However, Jim does not believe do you believe that Jim is excluded from receiving overtime
that he is entitled to overtime pay because his title is pay because he is a manager?


1. P. Malles, Canadian Labour Standards in Law, Agreement, <http://www.theglobeandmail.com/report-on-business/
and Practice (Ottawa: Economic Council of Canada, 1977). careers/canadas-work-life-balance-more-off-kilter-than
2. J. Battye, “The Nine Hour Pioneers: The Genesis of the -ever/article4673216>; and M. Bittman, J. Brown, &
Canadian Labour Movement” (1979) 4 Lab 25; and D. J. Wajcman, “The Mobile Phone, Perpetual Contact, and
Morton, Working People, 5th ed (Montreal, QC: McGill- Time Pressure” (2009) 23 Work, Employment & Soc 673.
Queen’s University Press, 2007) at 21-25. 17. C. Cranford & L. Vosko, “Conceptualizing Precarious
3. The arrest of the strike organizers also resulted in the Employment: Mapping Wage Work across Social Location
enactment of the Trade Unions Act in 1872, which repealed and Occupational Context,” in L. Vosko, ed, Precarious
the application of criminal conspiracy laws to union or- Employment: Understanding Labour Market Insecurity in
ganizing (more on this in Part IV of this text). See an inter- Canada (Montreal, QC: McGill-Queen’s University Press,
esting discussion of this history in P. Craven, “Workers’ 2006) 43 at 43; and S. Procyk, W. Lewchuk, & J. Shields,
Conspiracies in Toronto, 1854 – 72” (1984) 14 Lab 49. Precarious Employment: Causes, Consequences, and Rem-
edies (Winnipeg, MB: Fernwood, 2017).
4. J. Fudge & E. Tucker, Labour Before the Law: The Regula-
tion of Workers’ Collective Action in Canada, 1900 – 1948 18. Organisation for Economic Co-operation and Develop-
(Toronto: Oxford University Press, 2001). ment, “Divided We Stand: Why Inequality Keeps Rising:
Canada” (December 2011), online (pdf): <http://www
5. M. Thomas, “Setting the Minimum: Ontario’s Employment
.oecd.org/social/soc/49177689.pdf>.
Standards in Postwar Years, 1944 – 1968” (2004) 54 Lab 49
at 57. 19. J. Fudge, E. Tucker, & L. Vosko, “Changing Boundaries in
Employment: Developing a New Platform for Labour Law”
6. International Labour Organization, “C001—Hours of
(2003) 10 CLELJ 329.
Work (Industry) Convention, 1919 (No. 1),” online:
<http://www.ilo.org/dyn/normlex/en/f?p=NORMLEXPU 20. See Donner, supra note 13 at 56. See also I. Christie, G.
B:12100:0::NO::P12100_INSTRUMENT_ID:312146>. England, & W.B. Cotter, Employment Law in Canada, 2nd
ed (Toronto: Butterworths Canada, 1993) at 212-14.
7. M. Altman, “New Estimates of the Hours of Work and
Real Income in Canada from the 1880s to 1930” (1999) 21. In British Columbia, however, an employer is prohibited
45:3 Rev of Income and Wealth 353. from assigning “excessive hours or hours detrimental to
the employee’s health or safety.” See Employment Standards
8. “Reports and Enquiries: Hours of Work in Canada” (1924)
Act, RSBC 1996, c. 113, s. 39.
9 Intl Lab Rev 387 at 388.
22. See, for example, Employment Standards Act, supra note
9. An Act Limiting the Hours of Work in Industrial Undertak-
21, s. 40 (double pay required for hours worked over
ings, 1923, 14 Geo. 5, c. 22.
12 hours per day).
10. Thomas, supra note 5 at 65.
23. Employment Standards Act, supra note 21, s. 36. An em-
11. Ibid. ployee can agree to take overtime pay for some hours that
12. This approach is consistent with that of the International would cut into that 32-hour rest period.
Labour Organization as reflected in ILO “Convention 24. Labour Standards Act, RSNL 1990, c. L-2, part III.
No. 103, Maternity Protection Convention (Revised),
25. See, for example, Ontario’s Employment Standards Act,
1952,” online: <http://www.ilo.org/dyn/normlex/en/f?p=
2000, SO 2000, c. 41, s. 22(7); and Alberta’s Employment
NORMLEXPUB:12100:0::NO::P12100_ILO_
Standards Code, RSA 2000, c. E-9, s. 23.
CODE:C103>.
26. Canada Labour Code, RSC 1985, c. L-2, s. 174.
13. See A. Donner, Working Times: Report of the Ontario Task
Force on Hours of Work and Overtime (Toronto: Ontario 27. Fresco v. Canadian Imperial Bank of Commerce, 2012
Ministry of Labour, 1987). ONCA 444 at para 75.
14. H. Arthurs, Fairness at Work: Federal Labour Standards for 28. Fulawka v. Bank of Nova Scotia, 2014 ONSC 4743. See also
the 21st Century (Ottawa: Human Resources and Skills De- V. Lu, “Settlement Reached in Scotiabank Overtime Case
velopment Canada, 2006) at 110-11. Involving Retail Branch Workers,” Toronto Star (24 July
2014), online: <http://www.thestar.com/business/2014
15. Donner, supra note 13 at 108. Whether working hour caps
/07/24/settlement_reached_in_scotiabank_overtime_
and overtime pay rules actually do affect employment
case_involving_retail_branch_workers.html>.
levels is debatable. See J. Friesen, “Overtime Pay and
Weekly Hours of Work in Canada” (2002) 8 Lab Econ 691. 29. M. Thomas, Regulating Flexibility: The Political Economy of
Employment Standards (Montreal, QC: McGill-Queen’s
16. J. O’Kane, “Canada’s Work-Life Balance More Off-Kilter
University Press, 2009). The trend is toward dropping the
Than Ever,” Globe and Mail (October 2012), online:

requirement for government approval of averaging 41. See, for example, Alberta Employment Standards Code,
agreements. supra note 25, s. 18.
30. See O. Reg. 285/01, When Work Deemed to Be Performed, 42. Ontario ESA, supra note 25, s. 53 (reinstatement duty) and
Exemptions and Special Rules. D. Doorey, “This Blog Entry s. 104 (reinstatement order).
Is about the Lunacy of Employment Standards Exemptions 43. See A. ten Cate, “The Impact of Provincial Maternity and
(and it has alpacas, emus, and minks too!)” online, Law of Parental Leave Policies on Employment Rates of Women
Work (blog): <http://lawofwork.ca/?p=8523>. with Young Children in Canada” (McMaster University,
31. See the discussion in B. Arai, “Re-Organizing Flexibility Department of Economics Working Paper, 2003-03),
and the Employment Standards Act in Ontario” (2007) 7 J online (pdf): <https://socialsciences.mcmaster.ca/econ/
Change Mgmt 89; and Thomas, supra note 29. rsrch/papers/archive/2003-03.pdf>.
32. BC Employment Standards Regulation 36/2019, ss. 1, 34. 44. New Brunswick enacted maternity leave provisions in
33. See J.P. Metal Masters 2000 v. Director of Employment Stan- 1964, but other jurisdictions did not take this step until the
dards, 2006 BCSC 928. 1970s. The rate of married women in the labour force
increased from 11 percent in 1951 to about 50 percent in
34. See O. Reg. 285/01, s. 8(b). Also Newrick v. 2439436
1980. See S. Crompton & M. Vickers, “One Hundred Years
Ontario Ltd., 2015 CanLII 78646 (Ont. LRB); Glendale
of Labour Force” (2000) 57 Can Soc Trends 2 at 8.
Golf and Country Club Limited v. Sanago, 2010 CanLII
4265 (Ont. LRB); Tri Roc Electric Ltd. v. Butler, 2003 45. For example, in Ontario an employee must have worked
CanLII 11390 (Ont. LRB); and Tsakiris v. Deloitte & for at least 13 weeks before her due date to qualify for
Touche LLP, 2013 ONSC 4207. pregnancy leave, and she must start her leave no earlier
than 17 weeks before her due date. See Employment Stan-
35. See, for example, N. Veldhuis & A. Karabegovi, “BC
dards Act, 2000, supra note 25, s. 46.
Family Day Will Cost BC Families,” Fraser Forum (Sep-
tember/October 2012), online: <https://www.fraserinsti 46. In 1971, unemployment insurance legislation was
tute.org/article/bc-family-day-will-cost-bc-families>. reformed to permit 15 weeks’ entitlement to paid mater-
nity benefits at a rate of 67 percent of the employee’s pay
36. See, for example, Ontario Employment Standards Act,
rate (today the rate is 55 percent). For a discussion of the
2000, supra note 25, s. 27.
development of maternity and parental leave in Canada,
37. See, for example, BC Employment Standards Act, supra see J. Pulkingham & T. Van Der Gaag, “Maternity/Parental
note 21, s. 57. Leave Provisions in Canada: We’ve Come a Long Way, but
38. Ontario Employment Standards Act, 2000, supra note 25, s. There’s Further to Go” (2004) 23:3/4 Women’s Lab Rts J
35.2: based on 4 percent for employees with less than five 116; and K. Meehan, “Falling Through the Cracks: The
years’ service and 6 percent for employees with five or Law Governing Pregnancy and Parental Leave” (2004) 35
more years’ service. Ottawa L Rev 211.
39. R. Ray, M. Sanes, & J. Schmitt, No-Vacation Nation Revis- 47. For a summary of current (2019) employment insurance
ited (Washington, DC: Center for Economic and Policy benefits for leaves, see <https://www.canada.ca/en/
Research, 2013) at 2, online (pdf): <http://www.cepr.net/ services/benefits/ei/ei-maternity-parental.html>. Although
documents/publications/no-vacation-update-2013-05 fathers can take parental leave, and many do, studies show
.pdf>. that parental leave is overwhelming claimed by women:
40. Canadian Index of Wellbeing, “All Work and No Play” K. Marshall, “Fathers’ Use of Paid Parental Leave” (2008)
(July 2014), online: <https://uwaterloo.ca/canadian-index 9:6 Perspectives, online (pdf): <http://www.statcan.gc.ca/
-wellbeing/blog/post/all-work-and-no-play>. pub/75-001-x/2008106/pdf/10639-eng.pdf>.


CHAPTER 20
Regulating the End of

II. Statutory Minimum Notice of Termination Requirements 322
• Explain how Canadian governments legislate the end of
A. Common Features of Statutory Notice of Termination Provisions in
employment contracts. Canada 322
• Describe the rules related to statutory notice of termination and B. The Interrelationship Between Statutory and Contractual Notice of
severance pay. Termination Requirements 327
• Discuss the interrelationship between the statutory requirements III. Severance Pay (Ontario and Federal) 330
and the common law rules of employment contract termination. IV. Statutory Protection Against Unfair Dismissal 330
• Discuss why employees might prefer to accept the statutory A. Laws That Prohibit Dismissals Contrary to Public Policy 330
minimum notice of termination entitlements rather than pursue B. Unjust Dismissal Laws 331
the potentially much greater contractual entitlements available V. Chapter Summary 332
under the common law rule of “reasonable notice.” Questions and Issues for Discussion 333
• Describe the laws that protect employees from unfair dismissal in Notes and References 333
the federal jurisdiction, Nova Scotia, and Quebec.
I. Introduction
Dylan, a manager of a large grocery store in Ontario for 20 years, was dismissed without notice
for stealing a box of cereal. The problem is that he did not steal a box of cereal, and after spend-
ing $60,000 on lawyer fees, enduring the stress of a trial, and waiting almost two years for a
decision, a judge finally agreed with him. Dylan was 55 years old when he was fired and has been
unable to find a new job since his wrongful dismissal. He is realistic about his slim chances of
ever getting another job, especially a management job, given his age. What company will hire a
person over 55 years old to work in retail management? The court ordered Dylan’s former em-
ployer to pay him wrongful dismissal damages, but Dylan cannot understand why he will not
just get his job back. If not for the employer’s mistake and faulty investigation, he would likely
still have his job and probably could have eventually retired with dignity and a pension.
In Part II, we learned that in the common law model, employees who have been dismissed
are not reinstated, even when the employer was clearly wrong and the dismissal has had devas-
tating effects on the employee. Unions have addressed this situation by negotiating just cause
provisions in their collective agreements that require employers to prove that an employee was
dismissed for a valid business reason. In Part IV, we will learn that Canadian governments
supplemented this collectively bargained model of employment termination law by granting
labour arbitrators the power to reinstate employees who have been dismissed without just cause,
a power that arbitrators exercise regularly. A vast divide exists between the job security rights of
just cause provision: A term in a collective agreement between a union and an employer that requires the employer dem-
onstrate “just cause,” or a good business reason, to discipline or dismiss an employee.
321

unionized and non-union employees in Canada. If Dylan had been unionized, he would almost
certainly have gotten his job back, with full back pay.
About one-third of Canadians (mostly the unionized ones) enjoy just cause protection. In
theory, non-union employees could bargain their own just cause provisions, but few do, either
because they believe (wrongly) that the law already requires the employer to have a good reason
to fire them, because they are not aware that they could, or because they lack the bargaining
power to do so. Governments could intervene and legislate a requirement for employers to show
a valid business reason to take away an employee’s livelihood, comparable to the just cause pro-
visions unions negotiate in collective agreements. The International Labour Organization called
for governments to do so in its Termination of Employment Convention, 1982, which states that
the “employment of a worker shall not be terminated unless there is a valid reason for such ter-
mination connected with the capacity or conduct of the worker or based on the operational
requirements” of the business.1 Canada has not ratified that convention, but some Canadian
governments have introduced a form of legislated just cause protection, albeit a much narrower
version of the just cause protection found in most collective agreements.
Most jurisdictions have elected not to require employers to justify why they dismiss employ-
ees or to reinstate wrongfully dismissed employees. A legal model that permits employers to
dismiss employees without cause is justified by its advocates as the best means of promoting
freedom of contract as well as labour market flexibility and efficiency. Yet, as noted in Chap-
ter 10, Canadian governments have not gone as far as American governments in this regard. In
the United States, employment contracts are presumed to be “at will”—which gives an employer
the right to dismiss an employee at any time for any reason with no notice—while in Canada,
employment standards legislation requires that most employees be given at least a minimum
amount of warning. Since bringing a lawsuit in court for breach of an employment contract is
so expensive and time consuming, many if not most Canadians treat the statutory termination
provisions found in employment standards legislation as the full extent of their legal entitle-
ments. This chapter considers that legislation.
II. Statutory Minimum Notice of Termination Requirements

As described in Chapter 10, the implied obligation for employers and employees to give “rea-
sonable notice” to terminate an indefinite-term employment contract had crystalized in Can-
adian common law by the 1920s. Later, as unions expanded their reach in the post-World War
II period, they bargained collective agreement terms that require employers to give employees
warning of terminations and layoffs.2 Therefore, when governments finally introduced statutory
minimum notice of termination provisions in the early 1960s, they were mimicking develop-
ments already long entrenched in the common law regime and the collective bargaining regime.
These regulatory initiatives are an outcome of the internal feedback loop, discussed in Chapter
2. Like the common law implied term of reasonable notice, the statutory minimum notice provi-
sions are intended to supply a cushion to employees to enable them to plan for unemployment
and seek alternative employment. Studies have found that employees who receive notice of ter-
mination have an easier time finding alternative employment.3
A. Common Features of Statutory Notice of Termination Provisions in Canada

Absent a statutory notice of termination requirement, employers and employees would be able
to agree to zero notice contracts similar to American “at will” employment contracts. Therefore,
Canada’s statutory notice provisions reflect governments’ rejection of “at will” employment
contracts for those employees eligible for statutory notice. Employers can choose either to pro-
statutory notice of termination: The requirement found in employment standards legislation for employers (and sometimes
employees) to provide a defined amount of notice that they are terminating the employment contract.

Chapter 20 Regulating the End of Employment Contracts 323
vide working statutory notice of termination or to pay an amount equal to the amount of wages
and benefits the employee would have received had they worked the statutory notice period
(called termination pay). Notice of termination must be in writing so that disputes over
whether notice was given and when it was given are reduced or eliminated. Termination pay
(and severance pay, discussed later in this chapter) is not subject to the common law rule of the
duty to mitigate, which we considered in Chapter 14, because it does not constitute damages for
breach of contract.4 It is a statutory entitlement that an employee has the right to receive, regard-
less of whether they earn new income during the notice period. Although Canada’s statutory
notice of termination provisions vary from one jurisdiction to another, they share some com-
mon features.
1. Minimum Notice of Termination: Qualifying Periods and Length of Notice

Each Canadian jurisdiction includes a minimum notice of termination qualification period—a
period of time from the date the employee was hired—ranging from 30 days in Manitoba, to
three months in Ontario, to six months in several other provinces. This qualification introduces
a form of statutory probationary period, which allows an employer to dismiss an employee
without any notice until the employee has been employed long enough to meet the qualification
threshold.5 The employment standards legislation in each jurisdiction also stipulates the min-
imum amount of notice of termination required, which ranges from one week’s notice to eight
weeks’ notice, depending on the length of time the employee was employed and the jurisdiction
(see Table 20.1).
2. Greater Notice Period for Mass Terminations

All provinces (except Alberta) and the federal jurisdiction require a greater period of notice in
the case of “mass terminations” that occur within a finite period of time (such as two, four, or
six months) based on the presumption that it will be harder for a large group of dismissed
employees to find new employment and mass terminations can impose heavy costs on the gov-
ernment and the community. The number of dismissed employees required to trigger the higher
notice periods varies from 10 in some provinces to 50 in others. For example, in Ontario, an
employer that dismisses from 50 to 199 employees in a four-week period must provide at least
eight weeks’ notice to each employee; for 200 to 499 employees, notice rises to at least 12 weeks;
and for 500 or more employees, notice rises to at least 16 weeks.6
3. Definition of Termination of Employment

Only an employee who has been terminated is entitled to statutory notice of termination, and
what constitutes a termination of employment is defined in the statutes. In most cases, it is ob-
vious when a termination occurs—the employer tells the employee that they are fired and that
is that. However, as we learned in the common law part of this text, sometimes it is less clear
when a termination has occurred. Constructive dismissals are an example. Recall from Chapter
13 that a constructive dismissal occurs when the employer commits a fundamental breach of
the employment contract that the employee treats as having terminated that contract. Employ-
ment standards legislation incorporates the common law doctrine of constructive dismissal into
the definition of termination, so that a constructive dismissal triggers the employee’s entitlement
termination pay: The payment owing to a dismissed employee under employment standards legislation that is in lieu of
working statutory notice.
probationary period: A period of time at the beginning of an employment contract during which the employer evaluates
an employee’s suitability for further employment.

TABLE 20.1 Statutory Minimum Notice of Termination Provisions in Canada
Time Employed
1–2 2–3 3–4 4–5 5–6 6–7 7–8 8–9 10–15
Less than 1 year years years years years years years years years years 15+ years
Federal 2 weeks 2 weeks* 2 weeks* 2 weeks* 2 weeks* 2 weeks* 2 weeks* 2 weeks* 2 weeks* 2 weeks* 2 weeks*
Alberta 1 week (after 3 months) 1 week 2 weeks 2 weeks 4 weeks 4 weeks 5 weeks 5 weeks 6 weeks 8 weeks 8 weeks
British
1 week (after 3 months) 1 week 2 weeks 3 weeks 4 weeks 5 weeks 6 weeks 7 weeks 8 weeks 8 weeks 8 weeks
Columbia
Manitoba 1 week (after 30 days) 2 weeks 2 weeks 4 weeks 4 weeks 6 weeks 6 weeks 6 weeks 6 weeks 8 weeks 8 weeks
New
2 weeks (after 6 months) 2 weeks 2 weeks 2 weeks 2 weeks 4 weeks 4 weeks 4 weeks 4 weeks 4 weeks 4 weeks
Brunswick
Newfoundland
1 week (after 3 months) 1 week 2 weeks 2 weeks 2 weeks 3 weeks 3 weeks 3 weeks 3 weeks 4 weeks 6 weeks
and Labrador
Northwest
2 weeks (after 3 months) 2 weeks 2 weeks 3 weeks 4 weeks 5 weeks 6 weeks 7 weeks 8 weeks 8 weeks 8 weeks
Territories
Nova Scotia 1 week (after 3 months) 1 week 2 weeks 2 weeks 2 weeks 4 weeks 4 weeks 4 weeks 4 weeks 8 weeks 8 weeks
Nunavut 2 weeks (after 3 months) 2 weeks 2 weeks 3 weeks 4 weeks 5 weeks 6 weeks 7 weeks 8 weeks 8 weeks 8 weeks
Ontario 1 week (after 3 months) 2 weeks 2 weeks 3 weeks 4 weeks 5 weeks* 6 weeks* 7 weeks* 8 weeks* 8 weeks* 8 weeks*

Prince Edward
1 week (after 6 months) 1 week 1 week 1 week 1 week 4 weeks 4 weeks 4 weeks 4 weeks 6 weeks 8 weeks
Island
Quebec 1 week (after 3 months) 2 weeks 2 weeks 2 weeks 2 weeks 4 weeks 4 weeks 4 weeks 4 weeks 8 weeks 8 weeks
Saskatchewan 1 week (after 13 weeks) 2 weeks 2 weeks 4 weeks 4 weeks 6 weeks 6 weeks 6 weeks 6 weeks 8 weeks 8 weeks
Yukon 1 week (after 6 months) 2 weeks 2 weeks 3 weeks 4 weeks 5 weeks 6 weeks 7 weeks 8 weeks 8 weeks 8 weeks

* Severance pay is required for qualifying employees in addition to notice of termination.
to statutory notice.7 Look at the definition of termination in the Ontario Employment Standards
Act as an example:
An employer terminates the employment of an employee … if,

(a) the employer dismisses the employee or otherwise refuses or is unable to continue employing
him or her;
(b) the employer constructively dismisses the employee and the employee resigns from his or her
employment in response to that within a reasonable period; or
(c) the employer lays the employee off for a period longer than the period of a temporary lay-off.
Applying this language, the Ontario Labour Relations Board ruled in the case of 1542335
Ontario Inc. v. Tuka that an employer that unilaterally changed an employee’s compensation
from a base salary plus commission to commissions alone (resulting in a significant pay cut) and
reduced the employee’s job status was found to have terminated the employment contract, enti-
tling the employee to statutory notice of termination.8
The inclusion of constructive dismissal in the definition of termination of employment in
employment standards legislation is another example of how the regulatory standards regime
mimics rules developed in the common law regime. However, sometimes the regulatory stan-
dards and common law regimes diverge. One example is the treatment of temporary layoffs. We
saw in Chapter 13 that in the common law regime, a temporary layoff can be treated by the
employee as a constructive dismissal, thereby entitling the employee to notice of termination,
unless the contract includes a right of the employer to temporarily lay off the employee.9 In Can-
adian employment standards legislation, in contrast, temporary layoffs are not considered a
constructive dismissal (or a termination), at least not initially.10 That’s because the statutes define
when a “temporary layoff ” becomes a permanent layoff, or a “termination” for the purposes of
the legislative entitlement to notice of termination. For example, in the Alberta legislation, a
temporary layoff is considered to last 60 consecutive days or less, while in the Ontario and BC
statutes, a temporary layoff is considered to last no more than 13 weeks in any period of 20 con-
secutive weeks. The right of an employee to statutory notice is not triggered until a layoff lasts
longer than a temporary layoff. Once that occurs, most statutes deem the termination to have
taken place on the first date of the layoff.11
All of this can get confusing, because it means that a temporary layoff may be a termination
under the common law (a constructive dismissal), even though it does not meet the definition of
a “termination” under employment standards legislation. The employer may be breaching
the employment contract by temporarily laying off the employee and yet not be in violation of the
employment standards legislation.12 The employee may be entitled to “reasonable notice”
of termination in the common law because they have been constructively dismissed, but not en-
titled to statutory notice of termination in the regulatory regime because they have not yet been
“terminated” according to the definition in the legislation. This is an example of why it is important
to keep the two regimes distinct in your mind when thinking about legal ques-
tions. Ask first whether the employer’s actions violate the contract according to the common
law rules we considered in Part II of the book, and then whether they violate a statute. The fact that
an action may be lawful under one regime does not mean that it is also lawful under another.
4. The Exemption of Certain Employees from Statutory Notice Entitlements

Finally, consistent with the pattern we have identified previously in Part III, many employees are
exempt from the legal entitlement to statutory notice. Some occupations are excluded from the
statutory notice provisions altogether—construction workers, for example, who often work on
discrete projects with no predetermined end date or who regularly move between job sites.
Some of the exemptions mirror those found in common law contract rules we learned about
earlier, such as employees whose contracts have become “frustrated” (see Chapter 11) and
employees who are employed under a fixed-term or fixed-task contract whose contract ends as

agreed (see Chapter 8).13 An employee who has been lawfully laid off and then is recalled to
work forfeits the entitlement to statutory notice if they do not return to work. These are just a
few examples. Exemptions from statutory notice vary across jurisdictions, and it is a good idea
to be aware of the exemptions for your jurisdiction.
In every jurisdiction, an employee is disqualified from statutory notice when they have
engaged in serious misconduct leading to termination for cause.14 This rule closely parallels the
common law doctrine of summary dismissal considered in Chapter 12. If an employee’s miscon-
duct would allow the employer to dismiss the employee for cause, without notice, in the com-
mon law regime, then the odds are that the statutory requirement to provide minimum notice
is also exempted. So, for example, an employee who repeatedly refused a direct order to remove
her earrings for safety reasons was denied statutory notice of termination because she had been
fired for cause (insubordination).15 Similarly, an employee who was terminated for “continuing
and flagrant disregard” for the employer’s rules regarding punctuality, and an employee who was
terminated for long-standing poor performance and a failure to improve, had both forfeited
their right to statutory notice.16
However, in some provinces the employment standards statute imposes a standard of just
cause that it is more difficult for the employer to satisfy than the test for summary dismissal in
the common law. For example, in Ontario, the legislation disqualifies from statutory notice (and
severance pay) “an employee who has been guilty of wilful misconduct, disobedience or wilful
neglect of duty that is not trivial and has not been condoned by the employer.”17 The element of
“wilfulness” means that conduct that could justify summary dismissal under the common law
test may not meet the test for disqualifying an employee from statutory entitlements.18 This situ-
ation is demonstrated in the case discussed in Box 20.1.

Disqualification from Statutory Notice for Wilful Misconduct
Oosterbosch v. FAG Aerospace Inc. It is my opinion that the plaintiff demonstrated a
2011 ONSC 1538 sustained course of casual and careless conduct that
was inconsistent with the continuation of his em-
Key Facts: Oosterbosch was dismissed by FAG Aerospace Inc. ployment but I do not accept the defendant’s sub-
after 19 years of employment for cause, without notice. The mission that his conduct was wilful.
employer relied on its progressive discipline policy as grounds All of the leaders who testified indicated that the
for dismissal, pointing to a series of four disciplinary warnings plaintiff was an experienced, competent machine
for shoddy job performance and lateness. The employee filed operator with an apparent attitude problem but
a lawsuit for wrongful dismissal and included in that action as none suggested his misconduct was intentional. …
well a claim for statutory notice.* He was undoubtedly careless and the persis-
Issue: Did the employer have cause to dismiss Oosterbosch tence of that carelessness justified his dismissal. I
without providing contractual notice or statutory notice? would not, however, characterize his offending be-
haviour as “wilful misconduct, disobedience or wilful
Decision: Yes, and no. The court ruled that the employer had neglect of duty” that would disentitle him to receipt
satisfied the common law standard of cumulative just cause, of termination and severance payments under the
which we considered in Chapter 12. A pattern of wrongful acts provisions of the Employment Standards Act, 2000.
by Oosterbosch had led to clear warnings and a failure to
improve. Therefore, Oosterbosch was not entitled to contrac- Therefore, Oosterbosch was entitled to statutory notice
tual notice. However, the court found that Oosterbosch’s mis- and severance pay.
conduct did not rise to the level of “wilfulness,” which is * In Ontario, an employee can claim employment standards damages as
required to forfeit entitlement to statutory notice and sever- part of a larger wrongful dismissal lawsuit, which is what happened in
ance pay: this case. See also Stewart v. Park Manor Motors Ltd., 1967 CanLII 243
(Ont. CA).

5. An Employee’s Statutory Obligation to Provide Notice of Termination

We learned in Chapter 15 that a common law implied term requires that employees provide
reasonable notice of termination to their employer. We noted that relatively few employers seek
damages when employees breach that term, since the harm an employer suffers when an em-
ployee quits without proper notice is often small. Since employment standards legislation is
principally designed to protect vulnerable employees, and there is already a contractual duty to
provide reasonable notice of termination, it is not obvious why governments would statutorily
require employees to provide notice to their employers. And indeed, many governments have
not. However, a few provinces (Manitoba, Saskatchewan, Alberta, Newfoundland and Labrador,
and Nova Scotia) do require employees to provide a small amount of notice to their employer,
ranging from one to two weeks, depending on the employee’s length of service. Newfoundland
and Labrador is the only jurisdiction in which the length of notice required is the same for both
employers and employees, ranging from one week’s notice to six weeks’ notice, depending on
the length of employment.19
B. The Interrelationship Between Statutory and Contractual Notice of

Termination Requirements
The statutory notice of termination requirements found in employment standards legislation
across Canada operate alongside the contractual requirement to provide notice of termination.
We can use an example to demonstrate how the two regimes relate. Consider Dylan’s case, which
appeared in the introduction of this chapter. Figure 20.1 describes Dylan’s contractual and statu-
tory entitlements.
It’s easy to figure out how much statutory notice is required because minimum notice
requirements are tied directly to length of service. In Ontario, for example, Dylan would be en-
titled to a “minimum” of eight weeks’ notice because the Ontario Employment Standards Act
requires that employers give employees with eight years’ or more service eight weeks’ notice.20
If the employer fails to provide at least that amount, then it would be in violation of the legisla-
tion, and Dylan could file a complaint with the Ontario Ministry of Labour seeking damages
based on a failure of the employer to provide eight weeks’ worth of wages.

How to File an Employment Standards Complaint
While it is possible for workers to file common law “wrongful of the complaint, sometimes as a precondition of filing the
dismissal” lawsuits in court on their own behalf, in practice, complaint with the government.
due to the complexities of the law and judicial processes, most You can find the details of how to file a complaint in your
of the time they retain lawyers to represent them. In contrast, province by searching “employment standards complaint” and
it is common for workers to file their own employment stan- the jurisdiction in which you are interested on the Internet.
dards complaints. This can be done by obtaining a complaint For example, a search of “employment standards complaint
form in hard copy from the provincial Ministry of Labour Ontario” leads you the Ministry of Labour’s website with the
website or offices and then completing and submitting it to electronic complaint form: <https://www.labour.gov.on.ca/
the government. Alternatively, nowadays it is possible and english/es/forms/claim.php>. Once the form is submitted, the
quicker to complete the complaint form online. In some prov- government will investigate whether a statutory breach has
inces, the worker is required to serve the employer with a copy occurred and make an order if any is justified.
Dylan’s contractual notice entitlements depend on what his contract states, if anything. Four
possible scenarios are described in Figure 20.1. In all but scenario two, Dylan is entitled to more
notice under the notice term in the employment contract than under the statute. An employer
can be in compliance with the statutory minimum notice of termination provisions and yet still
be in breach of the contractual notice of termination provisions. In scenarios 1 and 3, the con-

tract requires common law reasonable notice, which, as we learned in Chapter 10, judges deter-
mine by applying the Bardal factors (length of service, age of the employee, character of the
employment, availability of similar work, etc.). An employee in Dylan’s situation—a 55-year-old
manager with 20 years’ service—could easily be entitled to 18 to 24 months’ reasonable notice,
far more than the eight weeks’ statutory minimum notice.
FIGURE 20.1 An Example of the Interplay Between Statutory and Contractual

Notice of Termination Entitlements
Dylan is dismissed without cause and

without notice after 20 years’ employment
as a grocery store manager in Ontario.
He was 55 years old when he was fired.
How much notice is Dylan entitled to?
Contractual Entitlement Statutory Entitlement

Scenario Entitlement Ontario
Eight weeks’ notice
1 The employment contract

does not include a notice
of termination clause.
Reasonable notice, likely in the
range of 18–24 months, applying
the Bardal factors (see Chapter 10).
(Employment Standards Act,
2000)
Means of Enforcement

permits termination with
notice equal to the
Eight weeks’ notice (see Chapter 8
for a discussion of conditions for a
legal notice of termination
To enforce his statutory notice
entitlement, Dylan could file a
complaint under the
statutory minimum. contract clause). Employment Standards Act,
2000. An employment

permits termination with
no notice or less notice
Reasonable notice (likely in the
range of 18–24 months) because
the contract term is void. See the
standards officer (ESO)
employed by the government
would investigate and decide
than required by statute. discussion of Machtinger v. HOJ if proper notice was given. If
Industries Ltd. in Box 8.6). not, the ESO can issue an
4 The employment contract The amount of notice in the order for the employer to pay
permits termination with contract term. Dylan the wages he would
an amount of notice that have earned during the
is greater than the eight weeks. Either party can
maximum amount of appeal the ESO’s decision to
notice required in the an expert administrative
statute (i.e., six months’ tribunal called the Ontario
notice). Labour Relations Board.
Means of Enforcement
To enforce his contractual notice entitlement, Dylan would need to file
a lawsuit in a court for wrongful dismissal.
So why would Dylan accept only the eight weeks’ notice required by the statute when he is
entitled to so much more notice under his employment contract? The answer is probably

twofold. First, Dylan may not be aware of his contractual entitlement, especially in scenarios 1
and 3, since most people know little about implied contract terms such as “reasonable notice.”
Second, even if Dylan is aware that his contract entitles him to more than statutory notice, he
may not want to incur the cost, stress, and time required to litigate a wrongful dismissal lawsuit
to recover the additional contractual notice. A lawyer’s fees in a relatively straightforward
wrongful dismissal lawsuit can easily start at $50,000, and it can take years to get a decision. If
Dylan wins the lawsuit, the court may order the employer to pay a portion of his lawyer’s fees,
usually around 60 percent of the actual fees. If he loses, he may be ordered to pay a large share
of the employer’s legal costs in addition to paying his own lawyer’s fees.
Wrongful dismissal lawsuits are usually only prudent for employees with very long service
who are entitled to reasonable notice (because the difference between the contractual notice and
the statutory minimum notice will be largest for these employees) and high-income employees
(since the damages for each week added to the period of notice are relatively high). For the vast
majority of employees, a wrongful dismissal lawsuit makes little economic sense. Governments
recognize this and also want to limit the number of wrongful dismissal lawsuits filed in the
courts. The statutory minimum notice requirements were enacted to provide a cheaper, quicker,
and less complex legal notice model accessible to employees who are disinclined to pursue their
often much more extensive contractual notice entitlements. The prohibitive cost of litigating
wrongful dismissal lawsuits puts the common law courts out of reach for many workers, which,
as Box 20.3 describes, creates an access to justice concern.

Access to Justice and the Interplay Between Statutory and Contractual Entitlements
If employees cannot afford to enforce their contractual notice Ontario judge described one such employer’s approach to
of termination entitlements, they are left to rely on the em- dismissing employees:
ployer’s integrity to comply with the contract or statutory
minimum notice, even if their contract entitles them to much It is obvious that [the employer] has adopted a cor-
more notice than that. Applying the law of work frame- porate policy that it will only pay the statutory min-
work introduced in Chapter 2, we can observe that the em- imum to employees dismissed without cause,
ployer’s internal inputs (its power, values, and goals) play an compelling the employees to commence actions to
important role in determining whether the employer complies seek any further amounts.*
with notice of termination provisions in the employment
contract. The employer’s strategy of giving only the statutory min-
Many employers comply with their contractual obligations imum amount of notice when the employment contract re-
to provide employees with reasonable notice of termination, quires much more reflects an ethical or value choice—cost
or at least offer an amount of notice that is “in the ballpark” of savings over contractual compliance. The employer’s goal is
what a judge would order in a wrongful dismissal lawsuit. to minimize the cost of terminations, and the high cost to
However, some employers use the high cost of litigation to employees of enforcing notice of termination clauses in em-
their tactical advantage. They give their employees only the ployment contracts confers considerable power on the em-
statutory minimum notice, even if the employment contract ployer. A challenge for the legal system is how to make access
requires considerably more notice. This type of employer as- to justice—the ability to recover contractual entitlements—
sumes that most employees will not sue them, and if some available to all workers and not just to those with considerable
occasionally do, the employer can absorb whatever damages economic means.
it is ordered to pay. In the case of Moldovanyi v. Kohler Ltd., an * Moldovanyi v. Kohler Ltd., 2009 CanLII 7094 (Ont. Sup Ct J) at para 15.
See also Brito v. Canac Kitchens, 2011 ONSC 1011.
III. Severance Pay (Ontario and Federal)

Ontario and the federal jurisdiction require employers to pay additional money beyond what-
ever is required in terms of statutory notice obligations to qualifying employees.21 These pay-

ments are called severance pay. The amount of severance pay is tied to length of service, so it is
a benefit targeted at longer service employees. In Ontario, only employees with at least five years’
service are eligible for severance pay, whereas in the federal jurisdiction the minimum threshold
is 12 consecutive months’ service. Section 64(1) of the Ontario Employment Standards Act, 2000
also restricts severance pay to employers who meet one of the following two conditions:
(a) the severance occurred because of a permanent discontinuance of all or part of the
employer’s business at an establishment and the employee is one of 50 or more employees who
have their employment relationship severed within a six-month period as a result; or
(b) the employer has a payroll of $2.5 million or more.
These requirements are designed to limit severance pay costs to larger employers or employers
who undertake mass terminations flowing from workplace closures. There remains some debate
in Ontario about whether the $2.5 million threshold is to include only payroll for employees
working in Ontario, or whether it includes total company payroll, including payroll for employ-
ees working outside of Ontario.22
The amount of severance pay an employee is entitled to receive in Ontario is one week’s pay
per year of service (or part thereof) up to a maximum of 26 weeks’ pay. In the federal jurisdic-
tion, the formula is two days’ pay for each complete year of service, with no maximum but with
a minimum benefit of five days’ pay.23 The exemptions that disqualify an employee from statu-
tory notice tend to be mirrored in the severance pay provisions. For example, an employee who
quits or is dismissed for cause, as defined in the legislation, is disqualified from severance pay.
Severance payments (as well as termination pay) made by an employer are deducted from a
wrongful dismissal damage award so that the employer does not pay twice.24
IV. Statutory Protection Against Unfair Dismissal

Notice of termination and severance pay laws do not restrain employers from dismissing
employees, although they do impose costs on termination. However, statutory protection
against unfair dismissal does exist in Canada, and it restricts employers from dismissing
employees by regulating the reason for termination. There are two types of statutory protection
against unfair dismissal in Canada: laws that prohibit dismissals contrary to public policy and
unjust dismissal laws.
A. Laws That Prohibit Dismissals Contrary to Public Policy

A number of statutes prohibit the dismissal of employees for reasons contrary to public policy.
A prime example is human rights legislation, which prohibits a dismissal based on certain dis-
criminatory grounds (see Chapters 21 – 23). Collective bargaining legislation makes it unlawful
for an employer to dismiss an employee for joining a union or engaging in lawful union activ-
ities (see Part IV). These sorts of statutes restrict freedom of contract by prohibiting termination
for reasons that the government believes should not be relevant to employment decisions. The
available remedies for dismissals contrary to public policy usually include reinstatement as well
as back wages and reimbursement for lost benefits.
severance pay: Compensation that an employer must pay to a qualifying employee who has been dismissed; this compensation
is in addition to what is required by statutory notice obligations.
unjust dismissal law: A statutory law that imposes restrictions on the contractual right of employers to dismiss employees
for any reason at all.

Most employment-related statutes also include anti-reprisal provisions that make it unlaw-
ful to dismiss an employee for attempting to enforce their statutory rights.25 For example, an
employee who asserts their legislative employment standards or occupational health and safety
rights cannot be dismissed in retaliation. This makes sense, because if an employee could be
terminated for insisting on their statutory rights, then those rights would be hollow. In recent
years, attention has turned to protecting whistle-blowers—employees who disclose information
about wrongdoing committed by their employer.26 Most of this legislation applies to govern-
ment employees only. For example, Manitoba’s Public Interest Disclosure (Whistleblower Protec-
tion) Act creates a legal right for a government employee who “reasonably believes that he or she
has information that could show that a wrongdoing has been committed or is about to be com-
mitted” to report that wrongdoing to a supervisor, a senior official, or an ombudsperson
appointed by the government. If the disclosure is made, then the statute prohibits any reprisal
against the employee, including dismissal, and grants the power to the labour board (an expert
tribunal) to reinstate a dismissed employee.27 Other jurisdictions have enacted similar
legislation.28
B. Unjust Dismissal Laws

Employment standards legislation in only three jurisdictions—federal, Nova Scotia, and
Quebec—prohibits the dismissal of certain non-union employees without good or “just”
cause.29 Nova Scotia was the first to enact the just cause protection, in 1975, followed by the
federal government in 1978 and Quebec in 1979. These laws were modelled after Recommenda-
tion 119 of the International Labour Organization’s Termination of Employment Recommenda-
tion, 1963 (see the ILO’s influence on Canadian work law in Chapter 27).30 To qualify for this
protection, a non-union employee must have been employed for a specific time period: at least
12 consecutive months in the federal jurisdiction, ten years in Nova Scotia, and two years in
Quebec. Beyond that qualification, other differences exist in the details of the unjust dismissal
laws of the three jurisdictions, but we will not explore those details in this brief summary.31
Unjust dismissal laws do not prohibit a dismissal for valid business reasons, such as a permanent
layoff due to lack of work. They apply mostly to terminations in which the employer alleges there
was cause for dismissal. The employee can challenge that decision and, if they win, the law pro-
vides for the possibility of reinstatement with back pay, among other remedies.32
This statutory reinstatement power marks a fundamental change from the common law
model of wrongful dismissal considered in Chapter 12. Here again we see an example of the
regulatory regime learning from and adopting legal rules developed in another regime—in this
case, from the collective bargaining regime and “just cause” provisions negotiated by unions into
collective agreements.33 However, while it might seem fair to provide non-union workers with
parallel rights to protection from unfair dismissal that are enjoyed by unionized employees, only
the three jurisdictions mentioned have taken this step. Many politicians fear that a general
unfair dismissal law will prove too expensive to administer and impose costs and rigidities on
employers that will lead to job losses.34
The standard of cause applied by adjudicators and courts when enforcing statutory protec-
tion against unfair dismissal is similar to that applied by labour arbitrators who interpret
“just cause” for termination clauses in collective agreements (see Part IV) and by courts that
assess whether the employer had cause for summary dismissal (see Chapter 12).35 If the em-
ployer alleges cause for termination, an employee covered by the legislative protection can
anti-reprisal provisions: A statutory rule that prohibits an employer from dismissing or otherwise punishing an employee
for attempting to enforce their statutory rights.
whistle-blower: An employee who discloses information about harmful or illegal conduct of their employer or co-workers.

file an unfair dismissal complaint, and the employer must then demonstrate that it had a
good reason to dismiss the employee. Dylan, in the story that opened this chapter, would
probably get his job back if his contract were governed by one of the laws that protects
employees from unfair dismissal, since the employer’s reason for termination (alleged theft)
was unfounded.36
In 2016, the Supreme Court of Canada considered whether the unjust dismissal provision in
the Canada Labour Code prohibited an employer from terminating an employee without cause
but with a lengthy period of notice. Section 240 of the code states that a non-union employee
with at least 12 consecutive months of continuous employment “may make a complaint in writ-
ing to an inspector if the employee has been dismissed and considers the dismissal to be unjust.”
The Supreme Court ruled that section 240 eliminated the employer’s common law right to ter-
minate employees without cause and with notice, as explained in Box 20.4.37

Is Dismissal Without Cause and With Notice an “Unjust Dismissal” Under the Canada Labour
Code?
Wilson v. Atomic Energy of Canada Limited protect employees from termination without good cause, simi-
2016 SCC 29 lar to “just cause” applied in the unionized setting. While the
section does not prohibit terminations due to a legitimate lack
Key Facts: Wilson was terminated without cause after four- of work (i.e., a permanent layoff ), it does prohibit an employer
and-a-half years’ service at Atomic Energy of Canada Limited, from terminating an employee for other reasons simply by
a company that is regulated by federal employment legisla- giving them notice, as is permitted in the common law regime.
tion. Atomic Energy offered Wilson a severance package of six The unfair dismissal law overrides the common law right of
months’ pay if he signed a release promising not to bring any employers to terminate by giving notice and requires the em-
legal action against the Crown corporation. Wilson refused to ployer to demonstrate “just cause” for the termination.
sign the release and instead filed an “unjust dismissal” com- In assessing what constitutes just cause, adjudicators have
plaint under section 240 of the Canada Labour Code. An ad- correctly looked to guidance from labour arbitrators interpret-
judicator appointed under the code ruled that Wilson had ing “just cause” provisions in unionized collective agreements
been unfairly dismissed, but before he issued a remedy, the (see Chapter 36). Arbitrators have long applied the concept of
employer applied to the court for judicial review of that deci- “progressive discipline,” requiring employers to demonstrate
sion. The case ended up at the Supreme Court of Canada. that the employee had been warned of problems and given a
Issue: Is dismissal without cause and with notice an “unjust fair opportunity to improve. In this case, the employer did not
dismissal” according to section 240 of the Canada Labour Code? allege cause but instead insisted it could terminate Wilson
simply by giving him notice. That course of action is prohibited
Decision: Yes. The Supreme Court ruled that the purpose of by section 240 of the Canada Labour Code. The adjudicator’s
the unfair dismissal section of the Canada Labour Code was to decision was therefore correct.
V. Chapter Summary

This chapter reviewed the manner in which governments have intervened in the common law
regime’s model of employment contract termination. Most Canadian governments have refused
to legislate a requirement for employers to have a reason to terminate an employment contract
and, instead, have settled for a requirement for employers (and sometimes employees) to pro-
vide at least a minimum amount of notice of termination. This refusal has left unionized
employees with considerably greater job security than non-union employees, since unions usu-
ally successfully bargain “just cause provisions” for termination into their collective agreements,
as we will learn in Part IV. Moreover, it has left non-union employers with greater flexibility to
dismiss employees at a lower cost than is the case for unionized employers.


1. What came first, the common law implied term requiring “reasonable notice” of termina-
tion or statutory notice requirements in Canadian legislation?
2. Is an “at will” employment contract—a contract that can be terminated with no notice for
any or no reason—ever lawful in Canada?
3. What is the difference between notice of termination, termination pay, and severance pay?
Does every jurisdiction in Canada require that employers provide both termination and
severance pay?
4. Is it possible for an action by an employer to amount to a termination of the employment
contract in the common law regime but not in the regulatory standards regime? Explain.
5. What two types of statutory protection against unfair dismissal exist in Canada? Describe
each.
APPLYING THE LAW

1. Jonas was dismissed without cause from his job as a ation clause in his employment contract and that his
data processor at IBM after 20 years’ employment. He employer provided him only with the amounts to
was 58 years old at the time of his dismissal. Assume which he was entitled under the employment stan-
that none of the exemptions from notice and sever- dards legislation in your province.
ance pay apply. Jonas was earning $2,000 per week. a. Estimate how much reasonable notice a court
Applying the employment standards legislation in would order if Jonas sued IBM for wrongful dismiss-
your home province, determine the amount of statu- al. Based on your assessment, approximately how
tory notice of termination to which Jonas is entitled. Is much more money would Jonas be entitled to
he entitled to severance pay in your province? Why or under his contract as compared to under employ-
why not? If Jonas is entitled to severance pay, how ment standards in your province?
much severance pay is he entitled to? b. Considering your estimates, discuss why Jonas
2. Think back to Chapter 10, when we examined the re- might nevertheless decide not to sue IBM for
quirement of employers to provide “reasonable notice” wrongful dismissal.
of termination. Assume Jonas had no notice of termin-

1. International Labour Organization, “C158—Termination 5. In theory, an employee with less service length than
of Employment Convention, 1982 (No. 158),” Part II, Div- needed to qualify for statutory notice could still be entitled
ision A, Article 4, online: <http://www.ilo.org/dyn/ to “reasonable notice” under the common law or an
normlex/en/f?p=NORMLEXPUB:12100:0::NO::P121 expressed contract term, but that notice period would
00_ILO_CODE:C158>. likely be very short.
2. P. Malles, Canadian Labour Standards in Law, Agreement, 6. Employment Standards Act, 2000, SO 2000, c. 41, s. 58; and
and Practice (Ottawa: Economic Council of Canada, 1977). O. Reg. 288/01, s. 3(1).
3. C. Ruhm, “Advance Notice and Post Displacement Job 7. The language used in the Employment Standards Act, 2000,
Losses” (1992) 10 J Lab Econ 1. supra note 6, is typical of the language used in Canadian
4. Brake v. PJ-M2R Restaurant Inc., 2017 ONCA 402; The- employment standards statutes. Section 56(1)(b) provides
berge-Lindsay v. 3395022 Canada Inc. (Kutcher Dentistry that a termination occurs when “the employer construct-
Professional Corporation), 2019 ONCA 469; and Boland v. ively dismisses the employee and the employee resigns
APV Canada Inc., 2005 CanLII 3384 (Ont. Sup Ct J (Div from his or her employment in response to that within a
Ct)). reasonable period.”

8. See 1542335 Ontario Inc. v. Tuka, 2004 CanLII 29576 (Ont. 18. See Plester v. Polyone Canada Inc., 2011 ONSC 6068;
LRB). aff ’d 2013 ONCA 47 (statutory test of wilful misconduct is
9. Collins v. Jim Pattison Industries Ltd., 1995 CanLII 919 more rigorous than the common law test, essentially
(BCSC); McLean v. The Raywal Limited Partnership, 2011 “being bad on purpose”); Khashaba v. Procom Consultants
ONSC 7330; Pryor v. Taylor’s Feed, 2009 NBQB 346; and Group Ltd., 2018 ONSC 7617; and Oosterbosch v. FAG
Davies v. Fraser Collection Services Limited, 2008 BCSC Aerospace Inc., 2011 ONSC 1538.
942. 19. Newfoundland, Labour Standards Act, supra note 17, s. 52.
10. Note that an indefinite-term layoff is a termination. See 20. Ontario ESA, supra note 6, s. 57.
Stolze v. Addario, 1997 CanLII 764 (Ont. CA) 21. See Ontario ESA, supra note 6, s. 64; and Canada Labour
11. See Alberta Employment Standards Code, RSA 2000, c. E-9; Code, RSC 1985, c. L-2, division XI.
Ontario Employment Standards Act, 2000, supra note 6, s. 22. Doug Hawkes v. Max Aicher (North America) Limited, 2018
56(5); and British Columbia Employment Standards Act, CanLII 125999 (Ont. LRB) (includes only Ontario
RSBC 1996, c. 113, s. 63(5). payroll). Contrast with Paquette c. Quadraspec Inc., 2014
12. Collins v. Jim Pattison Industries Ltd., supra note 9; Janice ONCS 2431 (calculation not limited to Ontario payroll).
Wiens v. Davert Tools Inc., 2014 CanLII 47234 (Ont. Sup 23. For more details on the severance pay provisions, see
Ct J); Besse v. Dr. A.S. Machner Inc., 2009 BCSC 1316; Canada, Labour Program, “Terminations: Pamphlet 10—
Style v. Carlingview Airport Inn (1996), 90 OAC 83 Labour Standards,” online (pdf): <https://www.canada.ca/
(Ont. Ct J (Gen Div)); and Turner v. Uniglobe Custom content/dam/canada/employment-social-development/
Travel Ltd., 2005 ABQB 513, but see Vrana v. Procor Ltd., migration/documents/assets/portfolio/docs/en/reports/
2003 ABQB 98; aff ’d on other grounds in Vrana v. Procor labour_standards/termination/termination.pdf>; and
Limited, 2004 ABCA 126: finding that the statutory right Ontario Ministry of Labour, “Severance Pay,” online:
to temporarily layoff an employee in Alberta usurps the <https://www.ontario.ca/document/your-guide
common law doctrine of constructive dismissal. On the -employment-standards-act-0/severance-pay>.
flip side, a contract term permitting a temporary layoff to
24. Stevens v. Globe and Mail, 1996 CanLII 10215 (Ont. CA).
extend beyond the date it would become a termination
under employment standards legislation is void: Elsegood 25. See, for example, Ontario ESA, supra note 6, s. 74 (anti-
v. Cambridge Spring Service (2001) Ltd., 2011 ONCA 831. reprisal section) and s. 104 (power to reinstate a termin-
ated employee).
13. See, for example, O. Reg. 288/01, s. 2. See Ontario Nurses’
Association v. Mount Sinai Hospital, 2005 CanLII 14437 26. For a good summary of whistle-blower laws in Canada, see
(Ont. CA), which ruled that the law that excludes from Y. Saint-Cyr, “The State of Whistleblowing in Canada,”
statutory severance pay employees whose contracts Slaw (June 2013), online: <http://www.slaw.ca/2013/06/06/
become frustrated due to pay received during illness vio- the-state-of-whistleblowing-in-canada>. See also Mani-
lates s. 15 of the Charter. That decision led to an amend- toba’s The Public Interest Disclosure (Whistleblower Protec-
ment, creating new sections 9(1)2 and 9(2) of O. Reg. tion) Act, CCSM c. P217, s. 10 (disclosure) and s. 28
288/01. (remedies for reprisals, including reinstatement to
employment).
14. See, for example, BC ESA, supra note 11, s. 63(3); Alberta
ESC, supra note 11, s. 55(2); O. Reg. 288/01, s. 2(1)3; 27. The Public Interest Disclosure (Whistleblower Protection)
Manitoba The Employment Standards Code, CCSM, Act, supra note 26.
c. E110, s. 62(1)(h). 28. Including the federal jurisdiction, Ontario, Alberta, Sas-
15. Scherling v. Martin Pet Foods, 2002 CanLII 20640 (Ont. katchewan, and New Brunswick. Only Saskatchewan and
LRB). New Brunswick have whistle-blower protection legislation
that protects private sector employees from reprisals for
16. Lawrence v. StarTek Canada Services Ltd., 2009 CanLII
reporting illegal behaviour of the employer: The Saskatch-
9265 (Ont. LRB); and Services Plus Aquatics Inc. v. Clarke,
ewan Employment Act, SS 2013, c. S-15.1, s. 2-42, and New
2006 CanLII 39099 (Ont. LRB). See also North Perimeter
Brunswick Employment Standards Act, SNB 1982, c. E-7.2,
Service Centre, Inc. v. JH, 2013 CanLII 18602 (Man. LB)
s. 28. See Merk v. International Association of Bridge, Struc-
(applying common law standard to statutory “just cause”
tural, Ornamental and Reinforcing Iron Workers, Local 771,
provision, finding no just cause for repeated absenteeism).
2005 SCC 70.
17. See O. Reg. 288/01, s. 2(1)3 (notice exemption) and s.
29. Canada Labour Code, supra note 21, s. 240; Nova Scotia
9(1)6 (severance pay exemption). See also Newfoundland
Labour Standards Code, RSNS 1989, c. 246, s. 71; and
and Labrador, Labour Standards Act, RSNL 1990,
Quebec An Act Respecting Labour Standards, CQLR c.
c. L-2, s. 53(1)(a): “wilfully refused to obey a lawful
N-1.1, s. 124.
instruction … .”

30. International Labour Organization, “R166 - Termination relationships results in labour market disruptions and inef-
of Employment Recommendation, 1982 (No. 166),” online: ficiencies has proven highly influential. See R.
<http://www.ilo.org/dyn/normlex/en/f?p=1000:12100:327 Epstein, “In Defense of the Contract at Will” (1984) 51 U
14915435288:12100:NO::P12100_INSTRUMENT_ Chicago L Rev 947. See also the discussion in R. Arnow-
ID:312504>. See also G. England, Individual Employment Richman, “From Just Cause to Just Notice in Reforming
Law, 2nd ed (Toronto, ON: Irwin Law, 2008) at 364. Employment Termination Law” in M.L. Wachter & C.
31. For a fuller discussion of the unjust dismissal laws of the Estlund, eds, Research Handbook on the Economics of
three jurisdictions, see England, supra note 30 at 364-91. Labor and Employment Law (Cheltenham, UK: Edward
Elgar, 2012).
32. In Slaight Communications Inc. v. Davidson, [1989] 1 SCR
1038, the Supreme Court of Canada dismissed an employ- 35. England, supra note 30; and Sutherland v. Advance Furni-
er’s freedom of expression Charter challenge against an ture Distribution Inc., 2010 NSLST 12.
order by an adjudicator for the employer to prepare a ref- 36. A review of the “‘Unjust Dismissal’ Provisions in the
erence letter for a dismissed employee drafted by the Canada Labour Code” appears in P. Neumann & J. Sack’s
adjudicator. eText on Wrongful Dismissal and Employment Law,
33. I. Christie, G. England, & B. Cotter, Employment Law in online: <https://commentary.canlii.org/w/
Canada, 2nd ed (Toronto, ON: Butterworths, 1993) at 669: canlii/2012CanLIIDocs1?zoupio-debug#!fragment/
the unfair dismissal laws were intended to “provide the zoupio-_Toc20919009/BQCwhgziBcwMYgK4DsDWsz
non-unionized employee with substantially similar protec- IQewE4BUBTADwBdoAvbRABwEtsBaAfX2zgCYAGATg
tions against unjust discharge as the unionized employee EYeXXgEoANMmylCEAIqJCuAJ7QA5CtERCYXAjkLlaj
enjoys under a collective agreement.” See also G. England, Vp0gAynlIAhZQCUAogBk7ANQCCAOQDCd0aTAAj
“Section 240 of the Canada Labour Code: Some Current VRVhYSA>.
Pitfalls” (1999) 27 Man LJ 17; Champagne v. Atomic Energy 37. In Wilson v. Atomic Energy of Canada Ltd., 2016 SCC 29,
of Canada Limited, 2012 CanLII 97650 (CALA); and the court rejected a small line of contrary authority that
Roberts v. Bank of Nova Scotia (1979), 1 LAC (3d) 259. had ruled that the common law right to terminate with
34. In this area of the law, the neoclassical view (see Chapter notice only survived the passage of section 240. The
3) that government intervention in employment leading decision in this contrary line of authority was
Knopp v. Westcan Bulk Transport, [1994] CLAD No. 172.


C H A P T E R 21
Introduction to Human
Rights at Work
II. A (Very) Brief History of Human Rights Law in Canada 338
• Describe the history and development of human rights law in Canada.
III. Common Features of the Canadian Human Rights Model 340
• Explain how events at the international level following World War II A. Anti-Discrimination Provisions Apply to the Entire Life
influenced the development of human rights law in Canada in the Span of the Employment Relationship 340
1940s and 1950s. B. Human Rights Commissions 342
• Explain how Canadian human rights laws regulate job C. The Process for Filing, Investigating, and Litigating Human
advertisements, application forms, and job interviews. Rights Complaints 343
• Describe the origins and role of human rights commissions in Canada. D. The Remedial Powers of Human Rights Tribunals 343
E. The Limits on Raising Human Rights Complaints in Multiple
• Describe how human rights complaints are filed, investigated, and Legal Forums 345
litigated. IV. What Is Discrimination? 345
• Describe the broad range of remedies available to human rights V. Chapter Summary 347
tribunals to redress workplace discrimination. Questions and Issues for Discussion 347
• Describe the limits on pursuing human rights - based complaints in Notes and References 348
multiple legal forums.
• Define “direct” and “indirect” discrimination.
I. Introduction
We considered Seneca College v. Bhadauria in Chapter 6, a case in which the Supreme Court of
Canada refused to recognize a new tort of discrimination in the formation of employment con-
tracts.1 If Bhadauria believed that she had been denied employment because of her ethnicity, the
court explained, then her legal means for redress were under provincial human rights legisla-
tion, not in the common law courts. It’s now time to explore that legislation, and that is the task
of the next three chapters. In this chapter, we look at Canadian human rights law from a high-
level vantage point by considering some common features of the Canadian human rights model
before diving into the important question of what exactly constitutes “discrimination.”
Like all work-related legislation, human rights statutes impose restrictions on the rights of
buyers and sellers of labour power. While an employer in a system based on freedom of contract
might be able to hire all the workers it needs from within a homogeneous category of appli-
cants—such as all-white or all-male workers—modern human rights statutes make it unlawful
to choose workers based on skin colour or sex. Human rights statutes are an attempt by govern-
ments to inject public policy into contract law by prohibiting distinctions among workers that
the state believes are, or should be, irrelevant. Which distinctions the state chooses to prohibit
and the extent to which human rights statutes actually prevent discrimination are among the
most interesting questions that arise from this area of the law.
337

II. A (Very) Brief History of Human Rights Law in Canada

Let’s begin with a short history lesson. Consistent with the idea introduced in Chapter 2 that
law influences and is influenced by changes and developments in social and cultural values
(external feedback loop), human rights statutes reflect the evolution of social values over time;
as society comes to abhor a discriminatory practice, pressure grows on governments to enact
statutes to prohibit that discrimination. Among the earliest examples of anti-discrimination
statutes in Canada was Ontario’s Racial Discrimination Act, 1944. It prohibited advertisements
or notices from being published that discriminated against or indicated an intention to dis-
criminate against a person or group on the basis of “race or creed.”2 That law sought to abolish
the infamous “Whites Only” job advertisements common in Canada into the 1940s.3 But the
real push for rights-based legislation in Canada arose from the atrocities of World War II and
the rise of fascism that preceded it. Indeed, we cannot understand the history of Canada’s
human rights statutes in isolation from these broader international developments, as Box 21.1
describes.

The Law of Work Framework: How the Broader Political and Legal Subsystems Influence
Canadian Work Law
Prior to the 1940s, Canadian governments intervened in labour
markets minimally. The prevailing political orthodoxy aligned
most closely with what we described in Chapter 3 as the neo-
classical perspective, which is the view that labour practices
are best left to market forces, with limited state intervention.
However, the atrocities of the Nazi regime demonstrated to the
victorious allied forces, including Canada, that democracy
alone “could not guard against the rise of tyranny and oppres-
sion.”* In the aftermath of World War II, a broad international
consensus emerged in favour of greater state intervention in
the form of human rights statutes to protect people against
injustices, persecution, and discrimination by governments
and private actors—including employers—possessing eco-
nomic power.
John Humphrey and Eleanor Roosevelt.
A number of important international instruments were
developed immediately after World War II that would heavily
influence the direction of Canadian human rights law. The most
important was the United Nations’ 1948 Universal Declaration • the right to work … to just and favourable conditions
of Human Rights (UDHR), a non-binding statement of funda- of work and to protection against unemployment
mental human rights that national governments were encour- (article 23(1));
aged to implement through national human rights statutes. • without any discrimination … the right to equal pay for
John Humphrey, a McGill University law professor, alongside equal work (article 23(2));
Eleanor Roosevelt, activist and former First Lady of the United • the right to just and favourable remuneration ensuring
States, played an integral role in drafting the document. Article for himself and his family an existence worthy of
2 of the UDHR declared that “everyone” was entitled to the human dignity, and supplemented, if necessary, by
rights and freedoms described in the document “without other means of social protection (article 23(3));
distinction of any kind, such as race, colour, sex, language, • the right to form and to join trade unions for the pro-
religion, political or other opinion, national or social origin, tection of his interests (article 23(4)); and
property, birth or other status.”† Among the fundamental rights • the right to rest and leisure, including reasonable limit-
and freedoms listed in the UDHR were several for workers, ation of working hours and periodic holidays with pay
including the following: (article 24).‡

Chapter 21 Introduction to Human Rights at Work 339
Canada signed the UDHR in 1948, and in the decade that † United Nations General Assembly, “Universal Declaration of Human
Rights” (1948), online: <https://www.un.org/en/universal-declaration
followed the federal government and the provinces enacted
-human-rights/index.html>.
Canada’s early human rights statutes targeting discrimination
in employment practices, as well as formative collective bar- ‡ Ibid.
gaining statutes (discussed in Part IV).§ § W.A. Schabas, “Canada and the Adoption of the Universal Declaration of
Human Rights” (1998) 43 McGill LJ 403.
* A. Davies, Perspectives on Labour Law, 2nd ed (Cambridge, UK:
Cambridge University Press, 2009) at 39.
In 1951, Ontario enacted the Fair Employment Practices Act, which prohibited discrimina-
tion in employment based on race, creed, colour, nationality, ancestry, and place of origin.4 That
legislation referenced in its preamble the desire of the province to observe the UDHR. Other
jurisdictions followed with similar legislation, including Manitoba (1953), the federal govern-
ment (1953), Nova Scotia (1955), British Columbia (1956), New Brunswick (1956), and Quebec
(1964). The structure of these statutes was similar.5 They forbade discrimination by employers
(with some exceptions, such as small employers or some non-profit organizations), unions, and
employment agencies on the basis of a small list of prohibited grounds. They also permitted
employees to file complaints to a government-appointed commission, which could investigate
and determine whether an “offence” had been committed.6 The remedial powers in these stat-
utes were weak; for example, the Ontario Fair Employment Practices Act included the authority
to order a limited fine, but not to reinstate an employee dismissed as a result of
discrimination.
The number and content of prohibited grounds of discrimination have also expanded to
reflect evolution within the social, cultural, and religious subsystem (see Chapter 2). An obvious
example is the introduction in the 1990s of “sexual orientation” as a prohibited ground (see
Chapter 22), a legal development that would have been unimaginable in 1950s Canada. The
1950s Canadian legislation did not prohibit employment discrimination based on sex, political
opinion, or language, all grounds listed in the UDHR. Some jurisdictions had legislated equal
pay for women and men by the 1950s (see Chapter 18), but it was still lawful to refuse to hire
women altogether. Not until the late 1960s and early 1970s, when the women’s rights movement
gained momentum, did “sex” (and “marital status”) enter the list of prohibited grounds in Can-
adian employment discrimination legislation, accompanied by an exemption that allowed dis-
crimination on these grounds when sex or marital status was a “bona fide occupational
requirement” of a job, an exemption still found in our human rights statutes, as we will discuss
in Chapter 23.7
Other prohibited grounds of discrimination were added to human rights statutes over time
and with some variation among the jurisdictions, including family status (in the 1960s and
1970s), record of offences (in the 1970s), disability/handicap (in the 1970s), sexual orientation
(in the 1990s), and gender identity and expression (in the 2000s). “Age” was added to human
rights statutes beginning in the late 1960s, although the definition of “age” differed according to
place and time. For example, in Ontario, “age” was initially defined in 1966 as “40-65,” so that it
was lawful to discriminate against workers of other ages.8 Years later the definition was changed
to “18-64,” and then in 2006 to its current “18 or older.” Certain grounds are included in some
jurisdictions and not others (e.g., “political opinion” is a prohibited ground in nine jurisdictions
only), reflecting different political beliefs and priorities across the country. We explore the pro-
hibited grounds of discrimination in Canadian human rights law in detail in Chapter 22.
In the 1960s (led by Ontario in 1962), Canadian governments began to consolidate the vari-
ous anti-discrimination statutes dealing with employment, housing, and other services into

comprehensive human rights codes and acts, the basic models of which remain in effect today.9
Governments established new expert human rights tribunals and human rights commissions
to administer the legislation and promote human rights compliance.10 The tribunals were
granted broad remedial powers to redress unlawful discrimination, including the power to
reinstate dismissed workers, to order damages or workplace reorganization to eliminate dis-
criminatory barriers, and to order offenders to complete human rights awareness training.
Among the most significant developments in human rights law over the past 40 years was the
introduction of a duty to accommodate as a central pillar in the pursuit of discrimination-free
workplaces. The duty to accommodate was borrowed from the United States and was first rec-
ognized by the Supreme Court of Canada in the 1985 case of Ont. Human Rights Comm. v.
Simpsons-Sears (“O’Malley”) that we will discuss later in this chapter.11 The duty to accommo-
date imposes substantive and procedural duties on employers to alter workplace schedules,
rules, or physical impediments, and sometimes to build new structures or introduce new tech-
nologies to remove barriers to employment, unless taking those steps would cause undue
hardship (see Chapter 23).
This quick tour of historical developments in Canadian human rights at work is sufficient for
now. As we work our way through our discussion of human rights, we will note other important
events in the development of human rights law.
III. Common Features of the Canadian Human Rights Model

Human rights legislation has been enacted in every Canadian jurisdiction governing discrimin-
ation in various spheres of life, including in housing and the provision of services and, of course,
employment, which is our concern. As always, the details of the human rights regimes in Can-
ada’s various jurisdictions vary. However, if we survey the map from above, we can identify four
common features of the Canadian human rights legal model. We consider these features in this
section.
A. Anti-Discrimination Provisions Apply to the Entire Life Span of the

Employment Relationship
All Canadian human rights statutes include a general prohibition on discrimination in employ-
ment (among other areas, such as in housing and services). Section 5(1) of the Ontario Human
Rights Code is typical:
Every person has a right to equal treatment with respect to employment without discrimination
because of race, ancestry, place of origin, colour, ethnic origin, citizenship, creed, sex, sexual orien-
tation, gender identity, gender expression, age, record of offences, marital status, family status or
disability.
That section, and others like it in human rights statutes across the country, creates a legal
right to “equal treatment with respect to employment without discrimination.” That language is
human rights tribunal: An expert administrative tribunal created by a government to hear and decide human rights com-
plaints and interpret and apply human rights statutes.
human rights commission: An organization created by a government to investigate human rights complaints and promote
human rights compliance through education, public outreach, and training.
undue hardship: The legitimate defence that an employer may raise to justify why it could not provide an accommodation to
an employee. This standard is demanding and requires the employer to demonstrate that significant difficulties—beyond mere
inconvenience—would result if it had to accommodate the employee.

broad: it covers all employment-related decisions, from the recruitment and hiring decision to
termination of the contract and everything in between, including decisions about promotions
and job assignments. Human rights statutes regulate the recruitment process by imposing rules
relating to the content of job advertisements and the questions employers ask in job interviews
and on job application forms, as summarized in Box 21.2.

Human Rights Law and the Recruitment Process
Since the early 1950s, human rights statutes in Canada have when the discriminatory preference listed “is a bona fide
prohibited discriminatory job advertisements. For example, occupational requirement,” which is a human rights defence
section 23(1) of the current Ontario Human Rights Code, which we consider in Chapter 23 that permits some types of dis-
has barely changed since 1951, reads as follows: crimination when the discrimination is justified for business
reasons and there is no way to accommodate the worker
The right … to equal treatment with respect to em- without the employer suffering “undue hardship”:
ployment is infringed where an invitation to apply
for employment or an advertisement in connection A person must not publish or cause to be published
with employment is published or displayed that dir- an advertisement in connection with employment
ectly or indirectly classifies or indicates qualifications or prospective employment that expresses a limita-
by a prohibited ground of discrimination. tion, specification or preference as to race, colour,
ancestry, place of origin, political belief, religion,
This section was violated, for example, when an employer marital status, family status, physical or mental dis-
advertised for “female” servers and another for a “maintenance ability, sex, sexual orientation, gender identity or
man.”* expression, or age unless the limitation, specification
The BC Human Rights Code (s. 11) similarly prohibits dis- or preference is based on a bona fide occupational re-
criminatory job ads, but also creates an expressed exception quirement. [Emphasis added]
Restaurants can no longer advertise gender-specific employment opportunities.

An employer that advertised for a “young apprentice” on the A legal rule barring questions that elicit information about
basis that the job required heavy lifting violated this section prohibited grounds is distinct from a legal rule that regulates
and was ordered to pay a 40-year-old complainant $2,500 in the hiring decision. An employer might ask a job applicant an
damages for injury to dignity, feelings, and self-respect.† There unlawful question, but then make a hiring decision that is
was no evidence that being young was a requirement to be lawful because it is untainted by the information about the
able to do the lifting involved. prohibited ground. However, once an employer receives infor-
Canadian human rights statutes (except in British Columbia) mation relating to a prohibited ground, either because it asks
also prohibit employers from asking questions on application the employee for that information or it found the information
forms or in job interviews that elicit information related to on social media,# it must be prepared to persuade a human
prohibited grounds. Consider section 8(1) of the Alberta Human rights tribunal that its hiring decision was completely un-
Rights Act as an example: tainted by it. Damages, which is the usual remedy in cases of
unlawful ads or questions, can be awarded as a remedy for an
No person shall … make any written or oral inquiry unlawful question even if the tribunal rules that the hiring
of an applicant … decision itself was not discriminatory.
(b) that requires an applicant to furnish any infor- Note finally that sometimes it is lawful for some employers
mation concerning race, religious beliefs, colour, to ask questions about prohibited grounds because the human
gender, physical disability, mental disability, age, rights statute creates an exception that permits those ques-
ancestry, place of origin, marital status, source of tions. We will look at the various exceptions carefully in Chapter
income, family status or sexual orientation. 23, but to provide a quick example, human rights statutes
sometimes permit religious institutions to give hiring prefer-
The language in this section, which is similar to that found ence to people who adhere to that religion.** In that case, the
in other provinces, prohibits questions that directly ask about religious institution may be permitted to ask a job applicant
prohibited grounds, such as the question posed by the em- about their religion, because the law permits that particular
ployer in Bouraoui v. Ottawa Valley Cleaning and Restoration, employer to discriminate on the basis of religion. However,
who asked an applicant in a telephone interview if he was most employers would be breaking the law by asking appli-
black.‡ Asking a job applicant for their date of birth is also cants about their religion.
unlawful, since that question clearly seeks the applicant’s age.
Asking a gay applicant how he would respond if a customer
raised concerns about his sexual orientation and whether he * Cenanovic v. 2332489 Ontario Inc., 2014 HRTO 1811; and Wedley v.
Northview Co-operative Homes Inc., 2008 HRTO 13.
believed in God also violated section 8(1) of the Alberta act
cited above.§ † Miu v. Vanart Aluminum and Tam, 2006 BCHRT 219.
More often, though, the questions that run afoul of human ‡ Bouraoui v. Ottawa Valley Cleaning and Restoration, 2014 HRTO 1303.
rights statutes involve more subtle attempts to elicit informa-
§ Landry v. Vegreville Autobody (1993) Ltd., 2017 AHRC 1.
tion related to prohibited grounds, such as these:
# See the discussion of employer use of social media to research job
• What does your husband think of you moving to take applicants in this “Fact Sheet” prepared by the Ontario Human Rights
this job? [marital status] Commission: “Interview Questions and Facebook (Fact Sheet)” (2012),
online: <http://www.ohrc.on.ca/en/interview-questions-and-facebook-
• Oh, you just got married, that’s great. So do you think
fact-sheet>.
you want to have children? [family status]
• Where did you grow up? [origin, citizenship, ethnicity] ** See, for example, Ontario Human Rights Code, RSO 1990, c. H-19, s.
24(1)(a).
• Is your surname Croatian or Serbian? [ethnicity]
B. Human Rights Commissions

Human rights commissions play a prominent role in preventing discrimination and promoting
and protecting human rights in their jurisdiction. Between 1963 and 1977, the provinces and
the federal government established human rights commissions (British Columbia abolished its
commission in 2002, and today only British Columbia and Nunavut do not have one).12 The
work of human rights commissions includes promoting compliance with human rights legisla-
tion and the abolition of illegal discrimination through education, public outreach, and training.
Human rights commissions are also granted statutory power to investigate and sometimes settle

human rights complaints. In some jurisdictions, they act as gatekeepers, deciding which cases
are sufficiently meritorious to proceed to a tribunal hearing if not settled, and then act as a liti-
gant representing the complainant.13 In recent years, commissions have been criticized by some
commentators for a variety of reasons, including for being too slow, too costly, too one-sided,
or altogether unnecessary.14
C. The Process for Filing, Investigating, and Litigating Human Rights
Complaints
Canadian human rights statutes are primarily complaint based. People who believe they have
experienced unlawful discrimination can file a complaint alleging a violation of one or more
sections of the jurisdiction’s human rights statute. In some jurisdictions, the human rights com-
mission can file its own complaint.15 In British Columbia, Ontario, and Nunavut, complaints can
be filed directly to a human rights tribunal, like filing a lawsuit directly to a court. However, in
the rest of Canada complaints are filed and initially vetted and investigated by a human rights
commission. The commission may decide not to proceed with a complaint, in which case the
complaint is dismissed without a hearing.16 The commission may also attempt to reach a settle-
ment of a complaint. In some jurisdictions, both the commission and the tribunal are authorized
to dismiss a complaint if a complainant refuses to accept a reasonable settlement offer.17 If a
complaint is not dismissed or settled, it may proceed to litigation. In every jurisdiction except
Saskatchewan (where complaints are referred directly to the courts),18 complaints are referred
to a human rights tribunal. Tribunals conduct hearings and issue binding legal decisions.
D. The Remedial Powers of Human Rights Tribunals

The objective of human rights statutes is to eliminate discrimination based on prohibited
grounds. If all discrimination arose from the deliberate, isolated, bad acts of rogue individuals,
then a legal model that sanctioned those bad apples for their discriminatory acts might be suf-
ficient. However, governments understand that discrimination is often a more complex prob-
lem, resulting from ignorance of the laws and from processes and norms that are deeply
embedded within organizations and society more generally. Thus, Canadian human rights
statutes confer broad remedial powers on human rights tribunals not only to compensate vic-
tims of discrimination but also to take proactive steps to promote future compliance with the
law.19 All Canadian human rights statutes grant human rights tribunals the power to order four
main types of remedies, as described in Box 21.3.

The Broad Remedial Powers of Human Rights Tribunals
Governments have conferred on human rights tribunals broad • Reinstatement and hiring orders to place an employee
remedial powers so that they can resolve claims of discrimin- unlawfully denied employment back into the position
ation. In general, all Canadian human rights tribunals have the they would have been in but for the unlawful
authority to order the following types of remedies: discrimination.
• Broader-based remedial orders intended to eliminate or
• Compensatory (or pecuniary) damages for lost employ-
discourage future discrimination and promote future
ment-related income suffered by victims of unlawful
compliance, including mandatory human rights train-
discrimination.
ing and, in some jurisdictions, mandatory hiring quotas
• General damages for harm suffered by the victim in the
or other orders intended to correct systemic
form of hurt feelings, injury to dignity and self-respect,
discrimination.
and loss of the right to be free from discrimination.

Human rights tribunals have the authority to compensate victims of human rights violations
by crafting a “make whole” remedy. This type of remedy attempts to put the victim back into the
position they would have been in had the discrimination not taken place. In practice that means
compensating the victim for “reasonably foreseeable” financial losses due to the discrimina-
tion.20 Those losses would include forgone wages and benefits if a worker is denied employment
or promotion, dismissed, or forced to resign as a result of the unlawful discriminatory actions
of the employer. Human rights damages are not restricted to lost income for a period compar-
able to what a court would order in a wrongful dismissal lawsuit. They also compensate the
victim for the loss they actually suffered as a result of the discrimination.21 In some provinces,
the amount of lost wages that can be recovered is capped by the statute. For example, in Alberta
the damages for lost wages are capped at two years.22 A duty to mitigate (see Chapter 14) applies,
so income earned from alternative sources or income that could have been earned had the em-
ployee engaged in reasonable efforts to find alternative employment is deducted from the mon-
etary damages award.23
General damages to compensate a victim for hurt feelings, loss of self-esteem and self-
respect, pain and suffering, and the loss of the right to be free from discrimination are regularly
ordered in human rights violation cases.24 In some jurisdictions, a statutory cap is imposed on
the amounts that can be awarded under this head of damages. For example, in the federal juris-
diction, the Canadian Human Rights Act provides that an award can be given for “pain and
suffering” that is not to exceed $20,000.25 However, in most jurisdictions, there is no statutory
cap.26
A tribunal can order an employer to hire (a hiring order) or reinstate an employee who has
been denied a job for discriminatory reasons. A hiring order will not be issued unless the tri-
bunal is persuaded that the victim of discrimination would have been hired but for the dis-
crimination.27 An employer might be ordered to either reinstate an employee to the next
available position (if there is no vacancy at the time of the tribunal’s reinstatement order) or
create a new position.28 In the 2016 decision Fair v. Hamilton-Wentworth District School Board,
the Ontario Court of Appeal upheld a decision of the Human Rights Tribunal ordering the em-
ployer to reinstate an employee who had been fired in violation of the Human Rights Code even
though almost a decade had passed since she was fired. Because her skills had lapsed over this
time, the employer was also ordered to provide the employee with up to six months’ training so
that she could perform her job. The employer was ordered to pay her nearly ten years’ worth of
lost wages, which was in the range of $400,000, and general damages in the amount of $30,000
for injury to dignity, feelings, and self-respect.29
Finally, human rights tribunals have broad powers to order remedies intended to overcome
systemic problems that contribute to discrimination. In some provinces, the tribunals are
granted the authority to order a guilty party to “do or refrain from doing anything” in order to
achieve compliance with the legislation.30 A common remedy ordered in employment dis-
crimination cases involves ordering managers to take human rights training.31 In some jurisdic-
tions (federal, British Columbia, Manitoba, Saskatchewan, and Nunavut), the legislation grants
the tribunal authority to order the implementation of an employment equity program to
redress a pattern of systemic discrimination at a workplace.32
hiring order: An order issued by a human rights tribunal or court requiring an employer to offer employment to a person
previously denied employment for discriminatory reasons.
employment equity: A legal model or remedial order that creates a positive obligation on an employer to redress historical
discrimination by giving preference in hiring to designated groups, such as women, visible minorities, Indigenous peoples, or
people with disabilities.

E. The Limits on Raising Human Rights Complaints in Multiple Legal Forums
We learned in the Bhadauria decision back in Chapter 6 that an employee cannot sue their em-
ployer in court for violating human rights legislation. However, sometimes the employer’s
wrongful action can amount to both a violation of human rights legislation and a breach of a “no
harassment” contract clause or a tort, such as intentional infliction of mental suffering (see
Chapter 16). In that case, the legal model grants workers the option to select the forum. Provided
that the employee alleges the discrimination amounts to a tort or a contract breach, and does not
rely exclusively on human rights legislation, then a court will allow the case to proceed.33
However, the law also protects employers from having to defend their actions in multiple
forums.34 Generally, an employee cannot pursue complaints relating to the same allegation of
discrimination in multiple legal forums (a strategy called forum shopping). For example, if an
employee elects to sue their employer for constructive dismissal, alleging sexual harassment that
made continued employment intolerable (see Chapter 13), that employee will not also be per-
mitted to proceed with a human rights complaint based on the same allegations.35 Human rights
tribunals in Canada are provided with a general right to dismiss complaints when the substance
of the complaint has already been dealt with in another legal proceeding, including in a court
or before a different administrative tribunal.36
IV. What Is Discrimination?

We know by now that human rights legislation prohibits “discrimination” in employment. But
what is discrimination? If your professor asked you to define discrimination, what would you say?
Consider the following scenario:
Jaspinder is Sikh and wears a turban. He applied for a job as a security guard with Bulldog Security
Inc. and got the job. He was assigned to provide security at a construction site. When he arrived at
the work site, he was told by his employer to wear a hard hat. Jaspinder protested that he could not
wear the hard hat because it would not fit over his turban. His supervisor told him to just remove the
turban for the shift, since the hard-hat rule was a mandatory safety rule at the work site; everyone
must wear a hard hat, even visitors to the work site. There were no exceptions. Jaspinder said that
removing his turban would conflict with his religious beliefs and he could not do it. The supervisor
told Jaspinder that he would need to leave the work site unless he wore the hard hat.37
Is Jaspinder a victim of discrimination in this scenario? To answer this question, we need to

unpack what we mean by “discrimination.” Maybe you answered your professor by saying that
discrimination means treating people differently. For example, if an employer adopted a pay
scale that paid men more than women, then it would be discriminating based on sex; the rule is
treating men and women differently. The discriminatory rule is benefiting men, but disadvan-
taging women.
When an employer intentionally applies different rules or standards to employees in this
manner, it is engaging in direct discrimination. Direct discrimination used to be quite com-
mon in Canada, and early human rights statutes were enacted to prohibit it. When employers
used to hire “Whites Only” or paid men more than women for identical jobs, they were directly
discriminating on the basis of skin colour and sex. Nowadays, blatant direct discrimination of
this sort is less common, although direct discrimination still occurs. It is not uncommon to see
forum shopping: The practice whereby a litigant attempts to litigate the same legal issue or the same facts in multiple legal
forums to find the most favourable outcome.
direct discrimination: A type of discrimination in which a rule, standard, or practice distinguishes an individual or group
based on a personal characteristic, such as separate pay scales for men and women or the practice of hiring people of only one
gender or one skin colour.

big signs in the windows of restaurants that read “Waitresses Wanted” like that in the photo in
Box 21.2. That type of sign qualifies as direct discrimination.
Direct discrimination is usually fairly easy to spot because it involves singling out a person
or a group based on a personal attribute. But that is not what is happening to Jaspinder. The
workplace rule causing Jaspinder problems does not single him out for special adverse treat-
ment. Jaspinder’s problem is that he is being treated the same as everybody else when he is not
like everybody else. He has an attribute or characteristic—his religion—that leaves him in a
different, less favourable, situation than other workers whose religion (or lack thereof) does not
similarly require the wearing of a turban.
Jaspinder is experiencing a type of discrimination known as indirect discrimination (also
known as adverse impact, disparate impact, or constructive discrimination). Indirect discrimin-
ation occurs when a rule or requirement treats everyone the same on its face, yet has an adverse
impact on some people because of a personal attribute or characteristic. Indirect discrimination
is usually unintentional. The rule requiring all people to wear hard hats at the work site in-
directly discriminates against Jaspinder because it adversely impacts him because of his religion.
The concept of indirect discrimination was first applied to the employment context in the 1971
American case of Griggs v. Duke Power Co., where the employer’s requirement that all employees
have a high school diploma was found to have a much greater adverse effect on black workers
than white workers.38 In Canada, the scope of indirect employment discrimination contrary to
human rights statutes was confirmed and developed in several important Supreme Court of
Canada decisions in the 1980s and early 1990s, including the decision described in Box 21.4.39

What Is Indirect Discrimination?
Central Alberta Dairy Pool v. Alberta (Human Rights Decision: Yes. The Supreme Court of Canada explained that
Commission) this was a case of indirect (adverse impact) discrimination. The
[1990] 2 SCR 489 rule requiring Easter Monday work applied to all employees,
and was based on legitimate business concerns: Mondays were
Key Facts: Christie became a member of the World Wide particularly busy days, and the employer required all employ-
Church of God during his employment with Central Alberta ees to be present. However, an intention to discriminate is not
Dairy Pool. He requested to be absent on days that conflicted necessary for a finding of unlawful discrimination.
with the religion’s Sabbath, and the employer granted some of In the case of indirect discrimination, the workplace rule is
these requests. However, the employer refused to give Christie not struck down as unlawful. However, the onus shifts to the
Easter Monday off because operational needs required em- employer to demonstrate (1) that the rule is rationally con-
ployees to be at work that day. When Christie did not report to nected to the performance of the job; and (2) that it cannot
work on Easter Monday, he was fired. He filed a complaint accommodate the employee’s religion without suffering “un-
under Alberta’s human rights statute alleging discrimination due hardship.” In this case, the rule requiring Monday work was
on the basis of religion. The human rights tribunal found a rationally connected to the performance of the job, but the
violation of the statute and ordered the employer to pay partial employer failed to demonstrate that giving Christie the day off
lost wages. The employer appealed, and the case eventually would cause it undue hardship. People call in sick on Mondays
made it before the Supreme Court of Canada. or take vacations, and the employer has contingencies to deal
with that possibility. Therefore, it could have allowed Christie
Issue: Was the employer’s refusal to grant Christie a regularly the day off for religious observance.
scheduled workday off to observe a religious holiday indirect
discrimination on the basis of religion, contrary to the Alberta
Individual’s Rights Protection Act?
indirect discrimination: A type of discrimination in which a rule, standard, or practice treats everyone the same on its face,
yet has an adverse impact on some people because of a personal characteristic.

Most work-related human rights cases today involve indirect discrimination. Sometimes the
discriminatory effect on the worker is obvious, such as in Christie’s situation in the Central
Alberta Dairy Pool case. However, in other situations, the question of whether a workplace rule,
standard, or practice indirectly discriminates is less clear and the worker must present evidence
to establish a prima facie case of discrimination. For example, in the landmark case of British
Columbia (Public Service Employee Relations Commission) v. BCGSEU that we will consider
more fully in Chapter 23, in order to establish that a physical fitness standard indirectly dis-
criminated against women, a female complainant entered expert evidence demonstrating that
because of natural physiological differences between men and women, males were, on the
whole, more likely to meet the standard than females.40 In another case, a requirement to lift
50-pound boxes was found to indirectly discriminate against female employees because
females failed the test 16 times more often than males.41 The Supreme Court of Canada has read
the concept of indirect discrimination into the definition of discrimination in human
rights legislation, and statutes in some jurisdictions now expressly prohibit indirect
discrimination.42
So, to summarize, when a Canadian human rights statute prohibits “discrimination,” it pro-
hibits both direct and indirect forms of discrimination. The fact that the employer does not in-
tend to discriminate is not a defence, because intention is not required in human rights law. This
does not mean that every instance of discrimination at work is unlawful. As we will discuss in
following chapters, only some types of discrimination are prohibited—discrimination based on
“prohibited grounds”—and even discrimination based on prohibited grounds may not be
unlawful. That’s because Canadian human rights statutes also include a variety of defences or
exemptions that permit discrimination in some circumstances.
V. Chapter Summary

The story of human rights regulation in Canada begins primarily at the end of World War II.
Before that, Canadian governments did not perceive discrimination in employment as a prob-
lem requiring legal intervention. Over time, the range of discriminatory conduct prohibited by
human rights statutes has evolved to reflect changes in social and cultural values. Human rights
legislation is complex, and in this chapter we considered the Canadian human rights legal model
at a high level of generality, focusing on four of its common features: (1) human rights commis-
sions; (2) the process for filing, investigating, and litigating human rights complaints; (3) the
remedial powers of human rights tribunals; and (4) the limits on pursuing human rights com-
plaints in multiple legal forums. We then considered the meaning of “discrimination” and its
two forms, direct and indirect discrimination. The following chapters dive deeper into the
application of human rights law to the Canadian workplace.

1. What events precipitated the enactment of human rights legislation in Canada in the
middle years of the 20th century?
2. What is the role of human rights commissions in Canada?
3. Describe the range of remedial powers available to human rights tribunals in Canada. Why
is it considered necessary to grant the tribunals such broad remedial powers?
4. What is “forum shopping,” and how does the human rights model in Canada regulate it?
5. Explain the difference between “direct” and “indirect” discrimination.

APPLYING THE LAW

1. Which of the following scenarios are examples of dir- a. She places an ad on a popular electronic job board
ect discrimination, and which are examples of indirect seeking “Warehouse Men.” Does her job ad raise
discrimination? What prohibited ground(s) might apply any human rights issues in your opinion? Would the
in each case? ad be unlawful if only the common law applied?
a. A rule requires all employees to stand for their en- b. Amanda interviews three applicants, including a fe-
tire seven-hour shift. male applicant who assumed the reference in the
b. A women’s prison advertises jobs for “female prison ad to “men” was just a typo. Before the interviews,
guards.” Amanda does social media searches of all three ap-
c. A bar hires only women to be servers and only men plicants. She learns on Facebook that the female
to be kitchen staff. applicant is recently married and that her husband
d. An airline requires pilots to retire at age 60. is an airline pilot with Air Canada. Amanda knows
e. An employer stipulates that all employees must from past personal experience that pilots often get
be able to carry 20-kilogram boxes from one relocated to different hubs. At the interview, Aman-
side of the factory to the other several times da asks the female applicant what type of work her
per day. husband does, and when she answers that he is a
2. Amanda is the human resources manager for a large pilot, Amanda asks whether there’s any chance he
manufacturing company that is hiring warehouse might be transferred. She also asks the applicant if
workers to perform a variety of jobs that require heavy she has any children or plans to have children. Has
lifting and strength. Alison behaved unlawfully in your opinion?

1. Seneca College v. Bhadauria, [1981] 2 SCR 181. This 8. See Age Discrimination Act, 1966, SO 1966, c. 3, s. 1(a);
finding was more recently affirmed in Honda Canada Inc. and Human Rights Code, 1981, SO 1981, c. 53, s. 9(1).
v. Keays, 2008 SCC 39 at paras 63-67. 9. Human Rights Code, SO 1961 – 62, c. 93.
2. Racial Discrimination Act, 1944, SO 1944, c. 51, online 10. See D. Johnson & B. Howe, “Human Rights Commissions
(pdf): <http://historyofrights.ca/wp-content/uploads in Canada: Reform or Reinvention in a Time of Restraint?”
/statutes/ON_Racial.pdf>. (1997) 12 CJLS 1.
3. A. Hunter, “Human Rights Legislation in Canada: Its 11. Ont. Human Rights Comm. v. Simpsons-Sears, [1985] 2
Origin, Development and Interpretation” (1976) 15 UWO SCR 536.
L Rev 21 at 24.
12. See G. Brodsky & S. Day, “Opinion: B.C. Only Province
4. Fair Employment Practices Act, SO 1951, c. 24. The legisla- Without a Human Rights Commission,” Vancouver Sun
tion applied to employers with five or more employees and (December 2014), online: <http://www.vancouversun
provided for a commission to investigate complaints and .com/Opinion+only+province+without+human+rights+
convict offenders. commission/10454168/story.html>.
5. Hunter, supra note 3 at 26. 13. For example, in Alberta, Manitoba, and Saskatchewan the
6. The Fair Employment Practices Act, supra note 4, exempted human rights commission decides whether human rights
domestic workers, employers with fewer than five employ- complaints can proceed to a tribunal hearing, but in
ees, and any “exclusively religious, philanthropic, educa- Ontario a complainant can file a complaint directly with
tional, fraternal or social organizations not operated for the Human Rights Tribunal of Ontario.
private profit” as well as non-profit organizations operated 14. See G. England, Individual Employment Law, 2nd ed
primarily to “foster the welfare of a religious or ethnic (Toronto: Irwin Law, 2008) at 246; C. Rootham, “Are
group” (s. 2(b)). Human Rights Commissions Still Relevant?” (2005) 12
7. See Human Rights Code, SO 1972, c. 119, s. 4 (now RSO CLELJ 199; Canadian Human Rights Review Panel, Pro-
1990, c. H.19). moting Equality: A New Vision—Report of the Canadian

Human Rights Review Panel (Ottawa: Department of 26. See the discussion in ADGA Group Consultants Inc. v.
Justice, 2000); P. Eliadis, Speaking Out on Human Rights: Lane, 2008 CanLII 39605 (Ont. Sup Ct J).
Debating Canada’s Human Rights System (Montreal, QC: 27. See, for example, Chapdelaine v. Air Canada, 1991 CanLII
McGill-Queen’s University Press, 2014); A. Pinto, Report of 553 (CHRT) at para 17.031; and Ontario (Human Rights
the Ontario Human Rights Review 2012 (Toronto: Queen’s Commission) v. Ontario (Liquor Control Board) (1987), 8
Printer for Ontario, 2012), online: <http://www.attorney CHRR D/4076.
general.jus.gov.on.ca/english/about/pubs/human_rights>.
28. See Hamilton-Wentworth District School Board v. Fair,
15. See, for example, Manitoba’s Human Rights Code, CCSM, 2016 ONCA 421; and Carasco v. University of Windsor,
c. H175, s. 22(3). Other jurisdictions in which the com- 2010 HRTO 2090 and 2010 HRTO 1968 (tribunal has the
mission can file its own complaints include federal, Nova authority to order the employer to hire the complainant to
Scotia, Saskatchewan, Ontario, and the Northwest the position of dean of the law school if it later ruled that
Territories. she had been denied the job unlawfully, even if an interim
16. See the discussion in Slattery v. Canada (Human Rights dean had already been appointed; this case was settled,
Commission) (1996), 205 NR 383 (FCA) (the federal com- so the tribunal was not asked to decide the case on its
mission was granted broad discretion to vet and dismiss merits).
complaints it considered to be not meritorious and, pro- 29. Hamilton-Wentworth District School Board v. Fair, supra
vided that the commission complies with its duty of fair- note 28.
ness in processing the complaint, courts will not
30. See, for example, Manitoba’s Human Rights Code, supra
intervene).
note 15, s. 42(2)(a); and Ontario Human Rights Code,
17. See, for example, the Alberta Human Rights Act, RSA 2000, supra note 19, s. 45(2).
c. A-25.5, s. 22(1)(b); and Manitoba’s Human Rights Code,
31. Islam v. Big Inc., 2013 HRTO 2009.
supra note 15, s. 37.1. A similar right to dismiss a com-
plaint for failure to accept a reasonable offer 32. See, for example, BC’s Human Rights Code, RSBC 1996, c.
exists in Saskatchewan, Prince Edward Island, Nunavut, 210, s. 37(2)(c). See the discussion in CN v. Canada (Can-
and Yukon. adian Human Rights Commission), [1987] 1 SCR 1114.
18. The Saskatchewan Human Rights Tribunal was abolished 33. See L’Attiboudeaire v. Royal Bank of Canada, 1996 CanLII
in 2011. Human rights complaints now proceed to the 1411 (Ont. CA); MacDonald v. 283076 Ontario Inc., 1979
Court of Queen’s Bench. See Saskatchewan Human Rights CanLII 1947 (Ont. CA); Jaffer v. York University, 2010
Code, SS 1979, c. S-24.1, s. 29.6. ONCA 654; and Sparrow v. The Manufacturers Life Insur-
ance Company, 2004 MBQB 281 (the court distinguished
19. Ontario Human Rights Code, RSO 1990, c H.19, s. 45.2. On
the Bhadauria decision on the basis that, unlike the legisla-
the objective of human rights law to eliminate discrimina-
tion under consideration in Bhadauria, the Manitoba
tion, see Robichaud v. Canada (Treasury Board), [1987] 2
human rights statute did not confer exclusive jurisdiction
SCR 84 at 92.
on the tribunal to decide human rights matters). In
20. England, supra note 14 at 254; and Ontario Human Rights Ontario, the human rights legislation now expressly
Commission v. Impact Interiors Inc., 1998 CanLII 17685 permits a court to interpret human rights legislation and
(Ont. CA). award human rights remedies in a lawsuit, provided the
21. Piazza v. Airport Taxicab (Malton) Assn., 1989 CanLII lawsuit alleges a breach of contract or a tort and is not
4071 (Ont. CA); and Ontario Human Rights Commission v. based solely on a violation of the human rights legislation:
Impact Interiors Inc., supra note 20. Ontario Human Rights Code, supra note 19, s. 46.1. See
22. Alberta Human Rights Act, supra note 17, s. 34. In Prince Wilson v. Solis Mexican Foods Inc., 2013 ONSC 5799 (in
Edward Island, damages for lost wages are capped at one addition to damages for wrongful dismissal, an employee
year from the date the discriminatory act occurred: dismissed for reasons related to disability was awarded
Human Rights Act, RSPEI 1988, c. H-12, s. 29.6. $20,000 for injury to dignity, hurt feelings, and self-respect
pursuant to the code). See also Madadi v. British Columbia
23. Moore v. B.C. (Ministry of Social Services) (1992), 17
College of Teachers, 2014 BCSC 1062 (BC courts have
CHRR D/426; and Morgan v. Canada (Armed Forces)
jurisdiction to determine human rights issues in the prov-
(1991), 85 DLR (4th) 473 (FCA). The onus is on the em-
ince, but no authority to grant human rights remedies).
ployer to prove that mitigation efforts were inadequate.
34. See discussion in British Columbia (Workers’ Compensation
24. Sanford v. Koop, 2005 HRTO 53; and Seguin v. Great Blue
Board) v. Figliola, 2011 SCC 52.
Heron Charity Casino, 2009 HRTO 940.
35. Ontario Human Rights Code, supra note 19, s. 34(11). See,
25. Canadian Human Rights Act, RSC 1985, c. H-6, s. 53(2)(e).
for example, Lloyd v. Novopharm, 2009 HRTO 377; and
See also Saskatchewan Human Rights Code, supra note 18,
Kinkley v. Home Depot Canada, 2009 HRTO 1551.
s. 31.4(b).

36. See, for example, BC’s Human Rights Code, supra note 32, 38. Griggs v. Duke Power Co., 401 US 424 (1971). See the dis-
s. 27(1)(f); Ontario Human Rights Code, supra note 19, s. cussion in Ont. Human Rights Comm. v. Simpsons-Sears,
45.1; and the Alberta Human Rights Act, supra note 17, supra note 11 at paras 16-18.
s. 22(1.1). See also Young v. Coast Mountain Bus Company 39. See also Ont. Human Rights Commission v. Simpson-Sears,
Ltd., 2003 BCHRT 28; Stuart v. Navigata Communications supra note 11.
and Others, 2006 BCHRT 562; and Laframboise v. Adam
40. British Columbia (Public Service Employee Relations Com-
Doyle Pharmacy Ltd., 2013 HRTO 866.
mission) v. BCGSEU, [1999] 3 SCR 3 (expert evidence was
37. These were roughly the facts in the case of Loomba v. admitted to demonstrate that owing to physiological dif-
Home Depot Canada, 2010 HRTO 1434. See also Bhinder ferences, women were less likely to be able to meet an
v. CN, [1985] 2 SCR 561. The Supreme Court of Canada aerobic standard in a job test than men, and therefore the
ruled in Bhinder that the hard-hat rule did not violate the standard indirectly discriminated against women).
Canadian Human Rights Act because the rule fell within
41. CUPE, Local 4400 and Toronto District School Board
the statutory defence of “bona fide occupational require-
(2003), OLAA No. 514 (Arbitrator Howe).
ment.” The court ruled that the employer had no duty
to accommodate. In subsequent decisions, the court ruled 42. See, for example, Manitoba’s Human Rights Code,
that Bhinder was wrongfully decided and the employer supra note 15, s. 9(3); Canadian Human Rights Act, supra
should have been required to accommodate Bhinder’s reli- note 25, s. 10; and Ontario Human Rights Code,
gion: see Central Alberta Dairy Pool v. Alberta (Human supra note 19, s. 11.
Rights Commission), [1990] 2 SCR 489.

CHAPTER 22
The Two-Step Human Rights

Model and the Prohibited Grounds
of Discrimination
II. A Two-Step Model for Analyzing Human Rights at Work 352
• Describe and apply the two-step model for evaluating human
III. The Prohibited Grounds of Discrimination 354
rights cases in the workplace.
A. Disability 357
• Explain what an employee must demonstrate in order to establish B. Sex 359
a “prima facie” case of discrimination. C. Race, Colour, Ethnic Origin (or Place of Origin), Nationality,
• Identify and explain the various prohibited grounds of Ancestry 361
discrimination in Canadian human rights statutes. D. Age 362
E. Religion or Creed 363
F. Marital Status, Family Status (and Civil Status in Quebec) 364
G. Sexual Orientation, Gender Identity, and Gender Expression 366
H. Political Opinion or Belief 366
I. Language 366
J. Source of Income, Social Condition, or Receipt of Public
Assistance 366
K. Record of Offence 367
I. Introduction
In the last chapter, we described the basic structure and some important features of the human
rights model in Canada. Now it is time to take a closer look at how human rights statutes regu-
late work-related discrimination. This chapter introduces the two-step framework for analyzing
human rights issues in the workplace. To apply this framework, we need to first grasp some key
human rights concepts. One concept is the meaning and scope of “discrimination” in Canadian
law, which we explored in the preceding chapter. Recall that discrimination encompasses both
direct and indirect discrimination. Keep this in mind as we move forward.
In this chapter, we move onto another important concept: the prohibited grounds of dis-
crimination. It is crucial to remember that not all forms of discrimination are unlawful.
prohibited grounds of discrimination: Personal characteristics that are protected from discrimination in human rights
statutes, including but not limited to sex, age, race, skin colour, and religion.
351

Employers are perfectly free to make distinctions on all sorts of grounds when assessing job
applicants or employees in hiring and firing decisions, or with respect to the distribution of
other job-related benefits, and they do so every day. Human rights law is only concerned with
discrimination that is based upon grounds that the government has decided are inappropriate
in the context of employment-related decisions.
Therefore, in order to know whether discrimination is unlawful, we need to know not only
what discrimination means, but also which types of discrimination our governments have
decided to outlaw. This is the central mission of this chapter. First, though, the chapter will
introduce and explain the standard “two-step model” that is used in the application of human
rights law to employment situations in Canada.
II. A Two-Step Model for Analyzing Human Rights at Work

An endless range of complex scenarios can give rise to human rights concerns at work. We re-
quire a model to help manage and organize how the law applies to these scenarios. The two-step
model we are about to discuss should guide your approach to human rights problems you
encounter in your course and in your working career. To begin, think back to the story of Jas-
pinder from the last chapter. Jaspinder, who is Sikh, was terminated from his job as a security
guard after he refused the employer’s order to wear a hardhat at work. The requirement to wear
a hardhat was based on a legitimate safety concern, but Jaspinder refused because to comply
with the rule he would need to remove his turban. The workplace rule put into direct conflict
Jaspinder’s job and his religion, and Jaspinder felt compelled to choose his religion with the
result that he lost his job.1
In Chapter 21, we discussed how the rule requiring that all employees wear hardhats in-
directly discriminates against Jaspinder on the basis of his religion. The rule had an adverse
effect on Jaspinder because of his religious beliefs. However, as we will now see, that conclusion
does not end the matter as far as human rights law is concerned. What if the rule is actually ne-
cessary in order to perform the job? What if the workplace is so dangerous that Jaspinder could
be killed if he goes to work without protective head gear? Should the employer not be entitled
to insist on rules that will protect workers from dying on the job? In fact, shouldn’t the law ac-
tually require employers to have such rules? Is the legal rule that employers must not dis-
criminate on the basis of religion absolute? Or are there exceptions, situations in which the law
permits discrimination?
The answer is that there are indeed exceptions. Sometimes, human rights legislation permits
discrimination on a prohibited ground. We need to know when that is. Human rights tribunals
and courts apply a two-step analysis when dealing with human rights complaints. The first step
involves assessing whether the employer has “discriminated” based on a “prohibited ground.” If
the answer is yes, then the second step requires an assessment of whether the human rights
legislation carves out an exception or creates a defence to that sort of discrimination in the cir-
cumstances. This two-step analysis is described in Box 22.1.

A Two-Step Model for Analyzing Human Rights Cases at Work
Human rights statutes are complex and must apply to a vast organize this complexity by applying a two-step analysis to
array of factual scenarios. Human rights tribunals and courts cases involving alleged work-related discrimination:

Chapter 22 The Two-Step Human Rights Model and the Prohibited Grounds of Discrimination 353
QUESTION ONE (Chapter 22)

Human rights legislation
Does a rule, standard, or practice discriminate against the complainant NO does not apply.
on the basis of a prohibited ground in the human rights statute?
YES
QUESTION TWO (Chapter 23)

The discrimination is a violation
Is that discrimination nevertheless permitted by a statutory defence NO of the human rights statute.
or an exemption in the human rights statute?
YES
The discrimination is not a violation

of the human rights statute.
The model presented in Box 22.1 looks straightforward, but it is actually quite complex. In
assessing Question One, human rights tribunals and courts require that the individual alleging
discrimination establish, on a “balance of probabilities,” a prima facie case of discrimination
based on a prohibited ground. As the Supreme Court of Canada explained recently in Stewart
v. Elk Valley Coal Corporation (see Box 22.4), that means that the individual must demonstrate
the following:
1. that he or she has a characteristic that is protected by a prohibited ground in the human
rights legislation;
2. that they have experienced an adverse impact; and
3. that the protected characteristic was at least a factor in the adverse impact (it does not
need to be the only factor).2
The adverse impact can result from either direct or indirect discrimination. If the applicant
establishes a prima facie case of discrimination, the burden shifts to the party accused of the
discrimination to establish that one of the exemptions or defences in the human rights legisla-
tion applies and, therefore, that their actions were lawful.
So, in order to apply the two-step model, we need to learn not only the meaning of “dis-
crimination” (considered in Chapter 21), but also the identity and scope of the prohibited
prima facie case of discrimination: In human rights law, when a complainant provides sufficient evidence that they have
been the victim of discrimination on a ground prohibited in a human rights statute, which shifts the burden to the employer to
establish that no unlawful discrimination occurred.

grounds (next), and the various statutory defences and exemptions and when they apply (exam-
ined in Chapter 23). While the meaning of “discrimination” is relatively consistent across
Canada,3 both the prohibited grounds and the statutory defences or exemptions to discrimina-
tion occasionally vary across the jurisdictions. What follows is a cross-country tour of the pro-
hibited grounds of discrimination in Canada.
III. The Prohibited Grounds of Discrimination

In a recent story in a Toronto newspaper, a former manager of a restaurant chain claimed that
he was instructed by his employer to ensure that “no uglies” were hired as servers (see Box 22.2).
He described a recruitment system in which managers made secret notes during interviews that
indicated whether an applicant was “attractive.”4 The most attractive female applicants were
hired. Assume that the manager is telling the truth, and that the restaurant hired job applicant
Jacqueline instead of Christine because, although Christine had more job experience, the man-
ager doing the interviewing thought Jacqueline was more attractive.

Can Employers Discriminate Based on Physical Appearance?
Human rights statutes do not prohibit all types of discrimina- Stacey Ball, a Toronto-based employment lawyer,
tion. They only prohibit discrimination that is based on a said a case could be made for job-seekers who are
ground that the government has chosen to include in human refused employment for being ugly.
rights legislation (“prohibited grounds of discrimination”). Can- “A case could definitely be made under the hu-
adian governments have elected not to prohibit discrimination man rights code. It’s a live issue,” Ball said. According
based on “physical appearance.” Therefore, people denied em- to human rights law in Ontario, similar to elsewhere
ployment based on their appearance need to point to another in Canada, employers cannot discriminate when
prohibited ground if they wish to challenge the decision under hiring based on age, religion, ethnic background,
human rights laws. This story describes an alleged employer sexual orientation or physical disability. “Let’s say
practice of hiring based on physical appearance. As you read you’re simply ugly due to your luck of the gene
the story and the rest of this chapter, think about whether the pool—is that a medical condition? That could be
practice would violate human rights statutes. argued. That’s your genetic composition,” Ball said.
To be sure no “uglies” even got an interview,
Trendy restaurants across the country are known for Hawker said he and other front of house staff were
more than their tapas. Their employees, gorgeous, directed to screen applicants coming through the
long-legged waitresses who strut over to tables like door at Moxie’s, and mark resumes with a “110” (one-
they’re on the catwalk, are not there by accident. ten) if they were unattractive. It’s an internal code
Just like each menu item is intricately plated, for “do not call,” he said. … Similar practices are al-
staff members are screened for their busts and rear- legedly in place at other restaurants across the coun-
ends, says a former restaurant manager. try. …
Darren Hawker, 40, a former assistant general Spokespeople for … Moxie’s … denied hiring for
manager at Yorkdale Moxie’s Classic Grill in Toronto, looks.
said he was directed by upper management to hire “It is possible that people who have come from
busty and thin applicants, regardless of whether or other companies have used (the 1-10 rating code),
not they were qualified. but it is not something we endorse or teach,” said
“If I wanted to hire someone the immediate Sue Thomson, vice president of marketing at
question was about their look …,” said Hawker, a Moxie’s.*
24-year restaurant industry veteran. “They had to
* Excerpt from K. Brownlee, “Uglies Need Not Apply,” Toronto Sun (March
have a good figure because that’s what attracted the 22, 2011), online: <https://www.pressreader.com/canada/the
men in to come drink.” -peterborough-examiner/20110322/282458525478829>. Reprinted by
But what if by the luck of the gene pool you’re permission.
not blessed with a perky chest and firm behind?

In that scenario, the manager is certainly discriminating against Christine by selecting Jac-
queline based on her physical appearance. But is it unlawful discrimination? The answer
depends on whether the human rights legislation protects against this type of discrimination.
Consider section 5(1) of the Ontario Human Rights Code:
Every person has a right to equal treatment with respect to employment without discrimination
because of race, ancestry, place of origin, colour, ethnic origin, citizenship, creed, sex, sexual orien-
tation, gender identity, gender expression, age, record of offences, marital status, family status or
disability.5
Physical appearance (or attractiveness) is not listed among the prohibited grounds of dis-
crimination in section 5. Therefore, if Christine brought a human rights complaint for being
denied the job, she would need to fit her situation into one of the other listed grounds. The
lawyer cited in the article in Box 22.2 suggests that the ground could be ancestry, based on
genetics—“I look this way because of my gene pool.” Maybe. If the manager’s opinion of attract-
iveness is really a proxy for skin colour, race, or ethnicity, then an applicant denied employment
for those reasons would have a case. However, if we assume that Christine and Jacqueline are
the same skin colour, race, and ethnicity, then those grounds would not help Christine. Can it
be sex discrimination, even though the competition was between two women? Perhaps it can,
especially if the attractiveness criterion is only applied to female applicants and not to male
applicants.6 What if the employer hires only “attractive” men, too, so the company policy is
really to hire only attractive employees, male or female? Would that undermine the sex dis-
crimination argument?
This example is useful because it reminds us again that only discrimination based on pro-
hibited grounds is regulated by human rights statutes. The prohibited grounds are the means by
which governments distinguish between acceptable and unacceptable distinctions at work. As
discussed in Chapter 21, the list of prohibited grounds has evolved over time in step with
changes in social and cultural attitudes. Within the context of the law of work framework (see
Chapter 2), this evolution reflects how changes in the social, cultural, and religious subsystem
influence the regulatory standards regime.
Table 22.1 presents prohibited grounds of discrimination in Canada by jurisdiction. The
grounds expressly prohibited in every jurisdiction are disability, sex, race, colour, ethnic origin,
age, creed or religion, marital status, family status, and sexual orientation. Other prohibited
grounds are listed in some jurisdictions but not others, including record of offence, ancestry,
income source or public assistance, gender identity or expression, political opinion or belief,
social disadvantage or condition, citizenship or nationality, language, and disfigurement. These
differences represent varying political views on what types of distinctions should be permissible
in the employment setting.
Sometimes human rights statutes define the prohibited grounds they include, so we should
always begin our assessment of whether a prohibited ground is involved by looking at the def-
initions section of the human rights legislation. For example, the Alberta Human Rights Act
provides the following definitions, which are similar to others found across the country:
(a) “age” means 18 years of age or older; …

(f) “family status” means the status of being related to another person by blood, marriage or
adoption;
(g) “marital status” means the state of being married, single, widowed, divorced, separated or
living with a person in a conjugal relationship outside marriage.7

TABLE 22.1 Prohibited Grounds of Discrimination in Employment in Canada

Grounds Prohibited in Every Jurisdiction
All Canadian jurisdictions prohibit discrimination on the grounds of disability, sex, race, colour, ethnic origin, age, creed or
religion, marital status, family status,* and sexual orientation.
Additional Prohibited Grounds of Discrimination, by Jurisdiction
Income Source/ Gender Political Social Disad-
Record of Public Identity/ Opinion/ vantage/ Citizenship/
Offence Ancestry Assistance Expression Belief Condition Nationality Other
Federal • •
Alberta • • •
British Columbia • • • •
Manitoba • • • • • •
New Brunswick • • • • •
Newfoundland
and Labrador • • • • • Disfigurement
Northwest • (in definition

Territories • • of social • • • •
conditions)
Irrational fear of
Nova Scotia • • • contracting an illness
or disease
Nunavut • • • •
• (receipt of
Ontario • • public • •
assistance)
Prince Edward
Island • • • • •
Quebec • • • Language, civil status
• (receipt of
Saskatchewan • public • •
assistance)
Yukon • • • • Linguistic origin
* In Quebec, “civil status” has been interpreted to include family status and marital status. See, for example, Brossard (Town) v. Quebec (Commission
des droits de la personne), [1988] 2 SCR 279.
However, often human rights statutes do not define the prohibited grounds, and so it falls to
tribunals and the courts to develop the meaning of those grounds through case law. The Su-
preme Court of Canada has affirmed that, since human rights statutes have the important public
policy purpose of protecting people from discrimination, they should be interpreted broadly or
“liberally” to protect as many people as their language can reasonably bear. This sentiment is
caught in the following passage from the Supreme Court’s decision in B. v. Ontario (Human
Rights Commission):
[T]his Court has repeatedly reiterated the view that human rights legislation has a unique quasi-
constitutional nature and ought to be interpreted in a liberal and purposive manner in order to
advance the broad policy considerations underlying it.8

Those policy considerations include the elimination of discriminatory barriers to employ-

ment. The remainder of this chapter describes the prohibited grounds of discrimination in rela-
tion to employment, as developed in Canadian jurisprudence.
A. Disability
Disability is the ground of discrimination most frequently raised in human rights complaints.
Table 22.2 breaks down the number of complaints by prohibited ground received by the Can-
adian Human Rights Tribunal in 2018. At a general level, disability includes both physical and
mental disabilities, although definitions vary across jurisdictions. Not every ailment constitutes
a disability. A disability requires “substantial ongoing limits on one’s activities” and does not
include temporary impairments of the type most people experience at one time or another, such
as the flu, a simple cold, allergies, or a sprained ankle.9
In some provinces, a physical disability is defined narrowly as one caused by “bodily
injury, birth defect, or illness.”10 That language excludes conditions that restrict performance
but that cannot be said to arise from injury, birth defect, or illness, such as obesity (unless the
obesity is caused by an “illness”).11 Newfoundland and Labrador includes “disfigurement” as a
separate ground. In British Columbia, where the human rights statute does not define “dis-
ability,” the termination of a female employee due to her height (she was 4 foot 11 inches) was
ruled to be disability discrimination.12 However, if the same case were adjudicated in Ontario,
“height” would only be treated as a disability if it were caused by an injury, a birth defect, or an
illness.
TABLE 22.2 Complaints Received by the Canadian Human Rights Tribunal

Prohibited Ground Number of Complaints Filed
Disability 55
Sex 43
National or ethnic origin 16
Race 9
Family status 18
Colour 2
Age 11
Religion 6
Marital status 8
Sexual orientation 3
Pardoned conviction 0
Source: Canadian Human Rights Tribunal, Annual Report 2018, online:

<https://www.chrt-tcdp.gc.ca/transparency/AnnualReports/2018-ar/2018-ar-en.html>.
The prohibition against disability discrimination also captures discrimination based on the
perception that a person is disabled (perceived disability) or was disabled in the past (past dis-
ability). Thus, even a worker who is not disabled can win a disability discrimination lawsuit,
provided the employer treated the worker as if they were disabled, as the case in Box 22.3
demonstrates.13


Disability Includes the Perception of a Disability
Quebec (Commission des droits de la personne et des Decision: Yes. The Supreme Court ruled that the purpose of
droits de la jeunesse) v. Montréal (City) human rights legislation is to “eliminate exclusion that is arbi-
2000 SCC 27 trary and based on preconceived ideas concerning personal
characteristics.” Arbitrary and preconceived ideas include an
Key Facts: Mercier was denied a job with the City of Montréal employer’s perception that someone suffers from a limiting
because the employer learned that Mercier had a minor spinal disability, even if the person does not. Therefore, for the pur-
anomaly. This condition did not restrict Mercier’s ability to poses of interpreting human rights legislation, a handicap (or
perform the job, but the employer believed it could cause her disability) includes not only discrimination based on a person’s
problems in the future. The Quebec human rights legislation actual disability but also discrimination based on the em-
prohibits discrimination on the basis of “handicap” but does ployer’s perception that a person has a disability. In this case,
not define that term. The Quebec Human Rights Tribunal ruled the employer discriminated against Mercier when it refused
that Mercier had not been discriminated against on the basis her employment based on the perception that she had a
of disability, since she was not disabled. That decision was disability.
appealed up to the Supreme Court of Canada.
Issue: Is an employer’s refusal to hire a worker that it believes

to be disabled, even if the worker is able to perform the job,
an act of discrimination on the basis of “handicap”?
Alcohol and drug addiction are disabilities.14 Therefore, employer policies, decisions, or
practices that adversely impact alcoholic or drug-addicted employees can run afoul of human
rights statutes. For example, if an alcoholic is terminated for reporting to work intoxicated or
for alcohol-related absenteeism, the employee may be able to establish prima facie discrimina-
tion based on disability.15 Similarly, where a drug addict is terminated for stealing drugs, a prima
facie case of discrimination may be established if the employee can show that the addiction
influenced the decision to steal.16 However, this does not mean that an employer can never dis-
miss a substance-addicted employee for work-related problems. The employer may still have a
defence (Step 2 of the human rights model) that will permit the discrimination in the circum-
stances, or the employee may not be able to establish that the termination is linked to the dis-
ability, as in the case described in Box 22.4.17

Being Terminated for Failing to Abide by a Drug Policy Not the Same as Being Fired for Drug
Addiction
Stewart v. Elk Valley Coal Corp. drugs and was terminated. S filed a human rights complaint
2017 SCC 30 arguing that he was addicted to cocaine (i.e., it was a disability)
and was unlawfully terminated because of this disability. The
Key Facts: Stewart (S) worked in a dangerous job driving a employer argued that S was terminated for breaching the drug
loader at a coal mine. To ensure workplace safety, the employer policy, not because of his disability.
adopted a policy requiring employees to disclose if they have
a drug addiction. If they disclosed an addiction, the employer Issue: Was S’s disability a cause of his termination?
would offer the employee treatment options. However, if they
did not disclose the addiction and were later in a workplace Decision: No. The Supreme Court explained that S must first
incident and tested positive for drugs, they would be termin- establish a prima facie case of discrimination. This required him
ated. S did not disclose that he used cocaine on his days off. to demonstrate that (1) he has a disability; (2) that he suffered
He was later involved in an accident, and he tested positive for an adverse impact; and (3) that the adverse impact was related

to his disability. The first two were satisfied here: he had a dis- disability. S had the same opportunity as all other employees
ability (drug addiction) and he lost his job (adverse impact). to comply, but he elected not to. Expert evidence established
However, the third requirement was not satisfied. S was ter- that although a symptom of addiction is denial of the addic-
minated because he failed to comply with the employer’s tion, S nevertheless retained the capacity to comply with the
policy requiring him to disclose his addiction, not due to his policy.
Since substance addiction, and the perception that someone suffers from an addiction, are
included within the meaning of disability, a mandatory drug- and alcohol-testing policy may
discriminate on the basis of disability. A mandatory random drug and alcohol policy will con-
stitute prima facie discrimination on the basis of disability if there are adverse employment
impacts associated with failing the test and the employer treats the employee who fails as if they
are substance addicted.18 This does not mean that all mandatory alcohol and drug testing is
unlawful discrimination. As we will see in Chapter 23 when we look at employer defences,
sometimes random testing, particularly in safety-sensitive jobs, is justified as a bona fide occu-
pational requirement (which is one of the defences we will learn about).
B. Sex
Sex discrimination includes treating employees of one sex less favourably than the other (such
as by refusing employment or advancement based on sex), physical touching, or other conduct
or words of a sexual nature, including gender-based name calling.19 It also includes sexual so-
licitation, such as promises or threats in exchange for sexual favours. Sex discrimination can also
take the form of standards or workplace rules that, while applying to both men and women, have
an adverse impact on women (see the discussion of indirect discrimination in Chapter 21). For
example, physical fitness standards that women are less likely than men to meet have been found
to be discriminatory on the basis of sex.20 A dress code that sexualizes women, such as a require-
ment to wear a bikini top to work at a bar, can constitute sex discrimination, especially if men
are not required to similarly expose their bodies.21
Workplace practices can produce systemic discrimination against women; that is, they can
produce an overall pattern of discrimination that perpetuates disadvantages for female workers.
Systemic discrimination is usually unintentional, but it results from long-standing practices and
norms within organizations that tend to favour men over women. To prove systemic discrimin-
ation, a complainant usually needs to present aggregate evidence of barriers faced by women in
an organization. For example, in CN v. Canada (Canadian Human Rights Commission), the Su-
preme Court of Canada found systemic sex discrimination based on evidence that only 0.7
percent of blue-collar jobs in a region where the employer operated were filled by women,
compared with 13 percent nationally.22 The employer was ordered to hire at least one female for
every four new hires until such time as 13 percent of employees in the job class were female.
Discrimination based on pregnancy, including the possibility that a woman may become
pregnant, falls within the scope of sex discrimination as only women can become pregnant.23 In
the leading case on this point, Brooks v. Canada Safeway Ltd., the Supreme Court wrote:
Combining paid work with motherhood and accommodating the childbearing needs of working
women are ever-increasing imperatives. That those who bear children and benefit society as a whole
systemic discrimination: Practices, behaviour, norms, or policies within an organization that may be unintentional and
unobserved yet perpetuate disadvantages for certain individuals because of a personal attribute or characteristic (e.g., race,
gender, age, disability, or religion).

thereby should not be economically or socially disadvantaged seems to bespeak the obvious. It is only
women who bear children; no man can become pregnant. … It is difficult to conceive that distinc-
tions or discriminations based upon pregnancy could ever be regarded as other than discrimination
based upon sex.24
Discrimination on the basis of pregnancy occurs when an employer dismisses an employee

for her pregnancy, refuses to hire a pregnant worker or a woman who the employer believes
might become pregnant, or otherwise disadvantages an employee because of her pregnancy—
such as by assigning her to less desirable shifts, denying her a promotion, or denying her benefits
that are available to other non-pregnant workers.25 See the case discussed in Box 22.5.

Discrimination Based on Pregnancy
Weihs v. Great Clips and Others (No. 2) Decision: Yes. The tribunal found that W had a characteristic
2019 BCHRT 125 (pregnancy) that was protected by a prohibited ground and
that she had suffered an adverse effect (termination). The more
Key Facts: Weihs (W) was hired in mid-January 2017 on a difficult issue was whether the termination was related to the
three-month probationary period as a hair cutter. W was as- pregnancy. The tribunal accepted the employer’s argument
signed nine shifts between January 15 and March 15. Her that W’s skills were deficient and that this was the reason for
performance during the first two months was acceptable but the termination. However, the tribunal ruled that the employer
not great, and she lacked skills in some areas. There were a was also influenced in part by the fact that W was pregnant.
couple of customer complaints about her cutting. On March The timing of the termination, eight days after W announced
15, 2017, W informed the employer she was pregnant. The she was pregnant and still a few weeks short of the end of the
employer congratulated her and made a comment to another three-month probationary period, was suspicious. Also, the
employee that she hoped none of the other employees were employer’s comment that she hoped no one else was pregnant
pregnant. After the announcement, W was assigned only four confirms that the employer was not enthusiastic about em-
more shifts. She was terminated on March 23. The employer ployees taking pregnancy leave. All that is required for a find-
claimed the termination was due to W’s poor performance, ing of discrimination is that some part of the decision was
and they told W she could reapply once her skills were up- influenced by the pregnancy, and that threshold was met here.
graded. W filed a human rights complaint alleging that she The employer was ordered to pay lost wages and tips from
was fired because of her pregnancy. the date of termination to the end of the probationary period,
Issue: Did the employer unlawfully discriminate against W on since the tribunal believed W would have been fired once the
the basis of her pregnancy? probation was over due to poor performance. W was also en-
titled to $9,000 for injury to her feelings, dignity, and
self-respect.
In the case of Janzen v. Platy Enterprises Ltd., the Supreme Court ruled that sexual harass-
ment is sex discrimination. The court also ruled that an employer could be held vicariously
responsible, under human rights legislation, for the sexual harassment committed by its employ-
ees and that employers have an obligation to redress harassment once they learn of it.26 Chief
Justice Dickson provided the following often referenced definition of sexual harassment: “sexual
harassment in the workplace may be broadly defined as unwelcome conduct of a sexual nature
that detrimentally affects the work environment or leads to adverse job-related consequences
for the victims of the harassment.”27
The requirement that the conduct be “unwelcome” and “detrimental” introduces a legal test
that attempts to distinguish between harmful harassment and consensual banter that sometimes
takes place in a workplace. Human rights tribunals and courts have been careful not to apply
sexual harassment: Unwanted conduct of a sexual nature that detrimentally affects the work environment or leads to job-
related consequences for the victim.

human rights legislation so broadly as to make unlawful every rude comment or flirtatious con-
duct, recognizing that adults sometimes engage in sexual banter or consensual conduct and that
the law should not attempt to prohibit all such behaviour.28
In deciding whether conduct is “unwanted,” tribunals and courts apply an objective test:
Would a reasonable person know that the conduct is unwanted in the circumstances?29 When
the conduct involves milder forms of sexual innuendo or banter, or the complainant has actively
participated in the sexual conduct or banter, complaints have often failed on the basis that the
conduct was neither detrimental nor unwanted.30 The conduct is more likely to be considered
“unwanted” when the perpetrator holds a position of power over the complainant, since tribu-
nals and courts recognize that lack of power can cause someone not to resist.31
C. Race, Colour, Ethnic Origin (or Place of Origin), Nationality, Ancestry
As we reviewed in Chapter 21, the first human rights statutes in Canada, dating from the 1950s,
prohibited discrimination in employment based on race, creed, colour, nationality, ancestry, and
place of origin, reflecting Canada’s growing multiculturalism and concerns that racial minorities
were experiencing labour market discrimination.32 These prohibited grounds are all distinct, in
the sense that discrimination may be based on just one, or some, but does not have to include
all of them at once. However, in many cases, these grounds intersect in a single episode of dis-
criminatory conduct. A racial slur or stereotype often engages colour, ethnicity, nationality,
ancestry, or all of these grounds at once. These prohibited grounds (along with creed) tackle
discrimination based on a person’s ethnic identity, background, blood line, or lineage.33 For ex-
ample, in the decision considered in Box 22.6, the complainants, most of whom were recent
immigrants from Central African nations, alleged discrimination on the basis of race, colour,
ancestry, and place of origin.

Discrimination Based on Race, Colour, Ancestry, and Place of Origin
Balikama obo Others v. Khaira Enterprises and Others adverse impacts with respect to their employment, and that
2014 BCHRT 107 their common background as workers from Central Africa was
a factor in this adverse impact. Conditions were worse at the
Key Facts: Over 50 Black employees of Khaira Enterprises al- worksite where these workers comprised almost the entire
leged they had worked as tree planters for the employer in workforce. The workers of African origin were not always paid
conditions of near servitude in an isolated area of British Col- their full pay, whereas non-Black workers were. Racial slurs
umbia. The allegations included deplorable living conditions were used, and it is no defence for an employer to argue that
and continuous racial harassment and verbal abuse by man- Black workers sometimes called each other racially derogatory
agement that was not directed at white or Asian workers. The names.
Black workers were called “lazy dogs,” among other derogatory
With the complainants having made out a prima facie case
epithets. The employer denied some allegations and argued
of racial discrimination, the onus shifted to the employer to
that while conditions may have been poor, they were poor for
provide a recognized defence for its behaviour. It provided
everyone and that the Black workers called each other deroga-
none. The employer was ordered to pay each complainant a
tory names, so that was just the culture of the workplace.
minimum of $10,000 for general damages for injury to dignity
Issue: Did the employer engage in discrimination based on and self-respect (some received slightly more than this), and
race, colour, ancestry, or place of origin? If so, what is the ap- conditions were attached to any future bids made by the
propriate remedy? employer on new contracts, including a requirement to pro-
vide each worker with a “rights document” in their mother
Decision: Yes. The complainants established a prima facie case tongue, explaining their legal entitlements and how to enforce
of discrimination. They demonstrated that they experienced them.

Discrimination on the basis of race, colour, ethnic origin (or place of origin), nationality, or
ancestry can take the form of offensive comments, harassment, jokes, and graffiti; in one case, a
refusal to hire an immigrant from India because he was “overqualified” was ruled to be dis-
crimination on the basis of ethnicity.34 In Perez-Moreno v. Kulczycki, a 2013 decision of the
Human Rights Tribunal of Ontario, an employee was found to have engaged in unlawful racial
discrimination against her manager when she posted a comment on her Facebook page calling
him a “dirty Mexican.”35 The reach of human rights legislation has expanded to social media
communications that relate to co-workers or management.
D. Age
The treatment of age discrimination in human rights statutes reflects ongoing and complex
policy tensions. When governments in Canada first prohibited age discrimination in the 1960s,
they protected only middle-aged workers. For example, in British Columbia “age” was
defined as 45 to 64, while in Ontario it was 40 to 64.36 Beginning in the 1980s, the protected age
range began to expand. The 1981 Ontario Human Rights Code defined “age” as 18 to 64, while
the definition in the BC Human Rights Act of 1992 was 19 to 64. Permitting discrimination
against workers under 18 (or 19) years of age was (and is) permitted on the basis that Canadian
age of majority statutes treat people under 18 as “infants,” still under the authority of their
parents.37
More recently, the exclusion of workers age 65 and older from the definition of age in human
rights statutes—and the employment practice of mandatory retirement it enabled—came
under scrutiny.38 When the cut-off employment age of 65 was adopted in the 1960s, relatively
few people actually worked until that age. Sixty-five was also the age that government-sponsored
pension plans, such as the Canada Pension Plan, and most private pension schemes fixed as the
typical retirement date.39 In the 2000s, Canadian governments repealed the upper parameter
(age 64) found in the “age” definitions in human rights statutes.40 As the baby boomer genera-
tion (people born from 1946 to 1965) aged, the percentage of Canadian workers approaching
their 60s grew exponentially, and their life expectancy was much longer than previous genera-
tions. Governments across Canada, uneasy about possible labour shortages, falling income tax
revenues, and drains on pension plan funds if mass numbers of baby boomers were all to retire
at 65, repealed the upper cap on the definition of “age” in human rights statutes.41
As a result, today an employment policy that forces employees over the age of 18 out of
their job simply because of their age is prima facie discriminatory, and an employer would
need to defend the policy by pointing to one of the statutory defences (see Chapter 23).
However, in most cases, the alleged discrimination is not that obvious, and the employee
must establish a link between their age and an adverse impact in order to demonstrate
discrimination.42
In the debates leading to the expansion of age discrimination protections to workers aged 65
and older, the concern was raised that employers who would have permitted aging workers to
retire with dignity in the past would now “be obliged to manage performance and even ter-
minate older workers who are having difficulty performing job duties.”43 Consider whether this
concern materialized in the decision described in Box 22.7.


Is the Dismissal of an Older Worker Who Cannot Meet Performance Standards Age
Discrimination?
Riddell v. IBM Canada Issue: Did the employer discriminate against Riddell on the
2009 HRTO 1454 basis of his age by offering him retirement packages and then
by “setting him up to fail” in jobs after he refused to accept any
Key Facts: Riddell was dismissed at 59 years of age for poor of them?
performance after 39 years’ service at IBM Canada. He filed a
human rights complaint, alleging age discrimination. He Decision: No. The Ontario Human Rights Tribunal noted that
claimed that prior to his termination, the employer offered it is not age discrimination to offer employees an early retire-
him “early retirement” packages on multiple occasions, all of ment package. Nor is it discriminatory to dismiss an older
which he refused. In response, Riddell alleged, the employer worker who is unable to meet performance standards, as long
initiated a campaign to assign him to jobs and apply job as those standards are not discriminatory. In this case, both
evaluation measurements it knew he could not meet so that the early retirement offer and the job performance standards
it could fire him for poor performance. The employer argued applied to Riddell were consistent with broader company pol-
that it had offered packages to many poor performers as icies and practices and did not single out older workers. Riddell
part of a company strategy to reduce the workforce. Riddell was unable to meet the standard, which was based on the
was assigned to various jobs in an attempt to find something average performance of all Canadian workers performing that
he could perform well, and the measurement standards job, and his performance standard fell far below that average.
were the same as, or lower than, those applied to other IBM Therefore, the dismissal was based on performance and not
employees. age discrimination.
E. Religion or Creed

Employers cannot discriminate on the basis of religion, which includes distinctions because a
person may adhere to the doctrine of one of the major recognized religions, believe in a newer
spiritual belief system (e.g., Falun Gong), or believe in the absence of all spiritual deities (athe-
ism).44 Human rights tribunals and courts have declined to engage in debates over the meaning
and application of religious doctrine. Rather, they have applied a test of sincerely held belief:
provided that the complainant holds a sincere and deep belief that a practice or obligation has
a relationship—or nexus—to religion, then that is sufficient to bring it within the scope of creed
or religion.45
As we saw in the case Central Alberta Dairy Pool (Box 21.4), an employer that insists that an
employee work on a religious Sabbath or holiday is engaging in prima facie discrimination on
the basis of religion that the employer would need to demonstrate is permitted by the legislation
(Step 2 of the human rights model).46 Employer dress codes can discriminate on the basis of
religion if they prohibit the wearing of religious clothing, as we discussed earlier when we con-
sidered Jaspinder’s refusal to remove his turban.47 The decision in Box 22.8 considers a variety
of other examples of religious and ethnic origin discrimination.
sincerely held belief: A legal test applied to determine whether a person has a religious belief that qualifies for protection
against discrimination on the basis of religion or creed. The test is met if the person holds a sincere and deep belief that a practice
(e.g., not working on Saturdays) has a relationship—or nexus—to religion.


Is a Requirement for a Muslim Chef to Taste Pork Religious Discrimination?
Islam v. Big Inc. adverse effects relating to that prohibited ground (harassment
2013 HRTO 2009; aff’d 2015 ONSC 2921 and constructive dismissal). The requirement to eat pork and
to eat during Ramadan were obvious cases of religious dis-
Key Facts: The employer was a French restaurant. It hired crimination. So was the refusal to permit time off for Eid, and
three employees to work in the kitchen, all of whom had im- the employer presented no argument that it could not accom-
migrated to Canada from Bangladesh and were Muslim. The modate the request.
employees filed human rights complaints alleging a number The rule requiring employees to primarily speak English in
of incidents they claimed amounted to religious discrimina- the kitchen was justified in some respects for safety reasons
tion, including that the employer forced them to eat pork in and because non-Bengali-speaking employees felt uncomfort-
violation of their religion, including during the Ramadan fast, able when the three employees made jokes and laughed in
and refused them time off work to observe Eid (a religious Bengali. However, the rule was applied inconsistently, and the
holiday); that the employer adopted an “English-only” rule in owner of the restaurant made mocking comments about
the kitchen and made derogatory and discriminatory com- Bengali, saying “blah, blah, blah.” The tribunal found that the
ments about the use of Bengali in the kitchen; and that the application of the English-only rule discriminated on the basis
employer threatened on multiple occasions to replace them of ethnic origin. The employer’s comments about replacing
all with “white staff.” The employees argued they had been the Muslim staff with “white staff” also constituted unlawful
constructively dismissed because the employer’s actions made harassment based on prohibited grounds.
continued employment intolerable. The employer denied the As a remedy, the tribunal ordered the employer to pay lost
allegations and argued that they had long hired Muslim em- wages from the date the employees left the employer until
ployees and had not acted in a discriminatory manner toward they found new work, plus additional payments ranging from
them. $12,000 to $37,000 to the employees to compensate them for
Issue: Did the employer discriminate against the Muslim kitch- the loss of the right to be free from discrimination and for
en staff on the basis of religion? injury to dignity, feelings, and self-respect. In addition, the
employer was ordered to complete a human rights training
Decision: Yes. The employees had a characteristic protected program offered by the Ontario Human Rights Commission.
by a prohibited ground (creed/religion), and they had suffered
In jurisdictions such as Ontario, where the Human Rights Code refers to “creed” rather than
“religion,” issues can arise as to whether the prohibited ground extends beyond formal recog-
nized religions to other non-religious systems of belief, such as political opinions or philoso-
phies. The Ontario Court of Appeal concluded in Jazairi v. Ontario (Human Rights Commission)
that “mere” political opinion—such as which political party one supports, or one’s thoughts on
conflict in the Middle East—is not included within the meaning of creed, but it left open the
possibility that a non-religious “cohesive belief system,” such as communism, could be.48 A case
before the Ontario Human Rights Tribunal at the time of writing argues that a firefighter was
discriminated against on the basis of creed when he was denied vegan food when on an assign-
ment in the northern wilderness. It remains to be seen whether veganism or vegetarianism will
be recognized as falling within the scope of “creed.”49
F. Marital Status, Family Status (and Civil Status in Quebec)

Marital status has been recognized as a prohibited ground in Canada since the 1970s; family
status was introduced as a prohibited ground slightly later.50 In B. v. Ontario (Human Rights
Commission), the Supreme Court ruled that the prohibited grounds of “family status” and “mari-
tal status” apply to discrimination based not only the status of the employee (i.e., being married
or having children) but also the particular identity of the employee’s spouse or family member.51
In this case, Mr. B was fired after his wife and daughter accused his boss of sexually assaulting

the daughter when she was a young child. Mr. B won his human rights complaint because the
court ruled that Mr. B’s dismissal constituted discrimination based on family and marital status.
Family status focuses on the relationship between parent and child.52 Therefore, it prohibits
an employer from refusing employment to an applicant because the person is (or is not) a par-
ent. More difficult is the question of whether family status also applies to work schedules that
interfere with parents’ obligations to care for their children or aging or ill family members.53 Is
it discrimination on the basis of family status for an employer to schedule employees to work
during times when they should be home caring for their children or elderly parent, or attending
their child’s sports event or school concert?54 Tribunals and courts have recognized that work
schedules regularly conflict with family, but that not every such conflict can amount to unlawful
discrimination. Where to draw the line is an ongoing source of legal uncertainty. The Federal
Court of Appeal considered this issue in the decision in Box 22.9.

Does “Family Status” Include Child-Care Responsibilities?
Canada (Attorney General) v. Johnstone (i) that a child is under his or her care and super-
2014 FCA 110 vision; (ii) that the childcare obligation at issue en-
gages the individual’s legal responsibility for that
Key Facts: Johnstone was an employee of the Canada Border child, as opposed to a personal choice; (iii) that he
Services Agency with two small children. Both she and her or she has made reasonable efforts to meet those
spouse worked at Toronto Pearson International Airport for the childcare obligations through reasonable alterna-
same employer. To qualify as a full-time employee, they were tive solutions, and that no such alternative solution
required to work at least 37.5 hours per week. Start times is reasonably accessible; and (iv) that the impugned
varied and covered hours in the mornings, afternoons, and workplace rule interferes in a manner that is more
evenings, with no predictable pattern. Johnstone requested a than trivial or insubstantial with the fulfillment of
fixed schedule that would enable her to be home with her the childcare obligation.
children during times when she could not find alternative
child-care arrangements. The employer offered to let her work In this case, Johnstone satisfied all of the conditions. She
a fixed schedule as a part-time employee, but not as a full-time was responsible for two small children, and it would be illegal
employee. She worked part time for a period, but then filed a for her to leave them alone, since both the Criminal Code and
human rights complaint alleging discrimination on the basis child welfare statutes impose care obligations on parents. She
of family status. made extensive efforts to find child care, but neither family
Issue: Did the employer discriminate on the basis of family nor paid services were available to cover the sporadic schedul-
status by refusing Johnstone’s request for a fixed-hour full-time ing hours both she and her spouse were required to work.
schedule that would enable her to care for her children? And, lastly, the scheduling conflict was not trivial: it created a
situation in which Johnstone would either have to give up her
Decision: Yes. The Federal Court of Appeal upheld the human full-time job or leave her children alone. The employer did not
rights tribunal’s decision that the employer had discriminated argue that it had a defence, so Johnstone won her case. The
on the basis of family status. The court explained that not every employer was ordered to pay lost wages based on the differ-
work schedule that makes child care difficult is discriminatory. ence between the hours Johnstone worked and the hours she
Rather, in order to make out a prima facie case of family status would have worked had she been assigned to a fixed 37.5-hour
discrimination, the employee must demonstrate the schedule as requested.
following:
Some human rights tribunals have refused to follow the test in Johnstone, arguing that
the test imposes a more rigorous standard of discrimination than is applied in respect of other
prohibited grounds. For example, the Johnstone test requires the employee to “self-accommodate”
by exhausting all reasonable alternatives before discrimination is found and limits

discrimination to cases where scheduling would conflict with a legal obligation.55 These more
stringent requirements to establish prima facie discrimination do not apply to other prohibited
grounds.
G. Sexual Orientation, Gender Identity, and Gender Expression

In 1977, Quebec became the first jurisdiction to add sexual orientation to the list of prohibited
grounds, but other jurisdictions did not add this ground until the 1990s, and some did not do
so until forced by the Supreme Court’s Charter-related decision in Vriend v. Alberta in 1998 (as
explained in Chapter 39).56 This prohibited ground captures blatant discrimination against
someone because they are gay, lesbian, bisexual, or heterosexual, or perceived to be so. It also
protects against harassment in the form of derogatory comments derived from stereotypes of
gay men, lesbians, and bisexuals, even if the target of the harassment is heterosexual.57 Since
2012, most Canadian jurisdictions (Nunavut and Yukon remained the sole outliers as of the time
of writing in summer 2019) have added “gender identity” and, in some cases, “gender expres-
sion” to the list of prohibited grounds applicable to employment. These grounds target dis-
crimination based on differences in how people experience and express their gender58 and
protect transgendered and transsexual workers from employment discrimination. Gender ex-
pression does not apply to personal fashion and grooming choices, such as hair and beard styles
or tattoos.59
H. Political Opinion or Belief

Political opinion or belief is protected in every jurisdiction except Ontario, Nunavut, Alberta,
Saskatchewan, and the federal jurisdiction. The omission of political opinion or belief from the
list of prohibited grounds in these jurisdictions leaves workers vulnerable to employment-
related discrimination based on those grounds—for example, for supporting a particular polit-
ical party or by engaging in political activities. Where “political opinion” is protected, human
rights tribunals have applied a broad scope, ruling that it covers comments and beliefs related
to government policy and legislative reform as well as formal political affiliation and comments
in support of political parties.60
I. Language
Only Quebec prohibits discrimination on the basis of language, although Yukon prohibits dis-
crimination on the basis of “linguistic background or origin.” However, in some situations,
language requirements may actually be a substitute for other prohibited grounds, such as ances-
try, ethnicity, or place of origin. Thus, in Gajecki v. Surrey School District (No. 36), an employer
who failed to assign jobs to a substitute teacher in English schools because of his Polish accent
was found to have discriminated on the basis of ancestry or place of origin.61 The complainant
must establish that a “nexus” exists between the negative treatment experienced due to the com-
plainant’s language skills and their place of origin, ethnicity, or ancestry.62 In the application of
this test, a requirement to speak proficient English or French is generally not found to be dis-
criminatory in jurisdictions that do not include language as a prohibited ground, on the theory
that anyone can learn to speak a new language. However, a refusal to hire based on accented
English and French by a worker from non-English-speaking or non-French-speaking back-
grounds has been found to discriminate based on ethnicity, ancestry, or place of origin.
J. Source of Income, Social Condition, or Receipt of Public Assistance

Some jurisdictions prohibit discrimination in employment on the basis of source of income,
social condition, or receipt of public assistance. Little case law applies these grounds to the

employment setting. However, the intention of these grounds appears to be to prohibit adverse
treatment of workers for reasons related to social conditions that often attract social stigma,
such as being (or having been) in receipt of public assistance, or in the case of “social condition,”
being poor or living in subsidized housing.
K. Record of Offence

Six jurisdictions prohibit discrimination based on past criminal convictions, although the def-
initions of what this ground means varies across jurisdictions. In Ontario, for example, the
prohibited ground applies only to offences for which the worker has received a pardon (now
called a “record suspension”) and to “provincial offences,” which are less serious offences (e.g.,
traffic offences).63 In British Columbia, on the other hand, the legislation protects from dis-
crimination “a person [who] has been convicted of a criminal or summary conviction offence
that is unrelated to the employment or to the intended employment of that person.”64 In Yukon,
both “criminal charges” and “criminal record” are listed as prohibited grounds.65 These differ-
ences mean that the scope of the protection against discrimination based on having committed
criminal offences is tied closely to the specific statutory language.
IV. Chapter Summary

This chapter introduced the two-step model for assessing human rights issues in employment.
The first step requires the complainant (usually the worker) to establish that they have a charac-
teristic protected by a prohibited ground and that they suffered an adverse impact at the hands
of the responding party (usually an employer) that is related to that characteristic. If a “prima
facie” case of discrimination is made out, the onus shifts to the responding party to point to a
defence or exemption that applies. This chapter examines the scope of prohibited grounds in
Canada. Although many of the same prohibited grounds apply across Canada, variations exist
across jurisdictions, reflecting differences of political opinion over the types of grounds that
should be subject to legal regulation in employment.

1. What must an employee demonstrate in order to establish a “prima facie” case of discrimin-
ation? If an employee is able to demonstrate this, does it mean that the employer had
violated the human rights legislation?
2. Refer to Table 22.1 and review the list of prohibited grounds found in your provincial
human rights statute. Which prohibited grounds not included in your provincial statute
are included in that of another province? Choose one and provide an example of employer
conduct that could violate the missing prohibited ground.
3. How did Canadian governments make the practice of mandatory retirement unlawful? By
doing so, did they make it unlawful for an employer to ever dismiss a 66-year-old worker?
Explain.
4. Is every comment made in a workplace that has sexual overtones sex discrimination?
Explain.
pardon: A legal order that removes a person’s record of a criminal conviction from their formal criminal convictions file. It may
be granted by the federal government if the person has served their sentence and demonstrated good behaviour in society for
a period of time. A pardon is now known as a “record suspension.”

APPLYING THE LAW

1. A local restaurant has a policy of hiring only tall, this search that applicant A is in her 40s, applicant B
blonde-haired, female servers. Identify hypothetical likes to party a lot, and applicant C was recently mar-
job applicants who would not be hired under this pol- ried. Lisa-Marie thinks someone in their 40s is a little
icy and any argument they could make that would es- old for the image of the store, that partiers are prone
tablish a prima facie case of discrimination. to miss or be late for morning shifts, and that newly-
2. Markus’ spouse gave birth to a baby girl last month. weds tend to get pregnant. None of the applicants are
Markus is occasionally required to travel for work, but hired, and they learn these reasons. Explain whether
his employer rarely sends him away for longer than a any of the applicants could establish a prima facie case
couple of nights. However, last week the employer ad- of discrimination on the basis of a prohibited ground.
vised Markus that he had been assigned to work on an 4. Now that it is legal, Martha likes to smoke marijuana in
out-of-province project for several months. When a park near her workplace while on her lunchbreak.
Markus informs his employer that he did not want to One day, her boss sees her doing this. When Martha
be away from his wife and daughter that long, he is returned to work after lunch, she was called into the
terminated. Discuss whether Markus would be capable boss’s office. Her boss asked whether Martha is using
of establishing discrimination on the basis of a pro- the marijuana for medical reasons or whether she is
hibited ground. addicted. Martha says no to both and confirms that
3. Lisa-Marie is the human resources manager at a local she is just a casual user because it helps her relax. The
retail store. She is looking to hire a new sales clerk. She employer then terminates Martha’s employment, giv-
receives three applications, one each from applicants ing her the amount of notice required by her contract.
A, B, and C. All of the applicants look comparable in Does Martha have a human rights complaint?
terms of work experience. Lisa-Marie decides to search
the Facebook profiles of each of them. She learns from

1. These were roughly the facts in the case of Loomba v. gender was irrelevant strains credulity.” See also Yanowitz
Home Depot Canada, 2010 HRTO 1434. v. L’Oreal USA, Inc., 106 Cal. App. 4th 1036 (2003) (em-
2. Stewart v. Elk Valley Coal Corp., 2017 SCC 30 at para 24. ployer committed sex discrimination by insisting that an
See also Moore v. British Columbia (Education), 2012 SCC employee be fired for not being sexually attractive enough
61. for his liking); Wilson v. Southwest Airlines Co., 517 F.
Supp. 292 (1981) (airline’s practice of hiring only attractive
3. In some jurisdictions, “discrimination” is a defined term in
women was found to be sex discrimination, and being an
human rights statutes, whereas in others its meaning is
attractive woman was not a bona fide occupational
derived from tribunal and court case law. For an example
requirement since the airline was not in the business of
of a statutory definition of discrimination, see Manitoba’s
providing a sex-oriented service).
Human Rights Code, CCSM, c. H175, s. 9.
7. Alberta Human Rights Act, RSA 2000, c. A-25.5, s. 44(1).
4. See D. Doorey, “Moxies: Where ‘Uglies’ Need Not Apply?”
online, Law of Work (blog): <http://lawofwork 8. B. v. Ontario (Human Rights Commission), 2002 SCC 66 at
.ca/?p=2994>. para 44. See also Ont. Human Rights Comm. v. Simpsons-
Sears, [1985] 2 SCR 536 at 546-47.
5. Human Rights Code, RSO 1990, c. H.19 [Ontario HRC],
s. 5 9. See, for example, Ouimette v. Lily Cups Ltd. (1990), 12
CHRR D/19 (Ont. Bd Inq) (the flu is not a disability);
6. See Janzen v. Platy Enterprises Ltd., [1989] 1 SCR 1252, a
Anderson v. Envirotech Office Systems, 2009 HRTO 1199
case involving sexual harassment, where Justice Dickson of
(bronchitis is not a disability); Moulton v. Leisureworld
the Supreme Court of Canada wrote: “To argue that the
Caregiving Centre, 2009 HRTO 1575 (a cold is not a dis-
sole factor underlying the discriminatory action was the
ability); Kalam v. Brick Warehouse, 2011 HRTO 1037
sexual attractiveness of the appellants and to say that their

(a sprained ankle is not a disability); and Nielson v. 18. Entrop v. Imperial Oil Limited, supra note 14 (random
Sandman Four Ltd. (1986), 7 CHRR D/3329 (BCCHR) (a alcohol testing violates the Ontario Human Rights Code
temporary sciatica ailment is not a disability). and is not a bona fide occupational requirement). But see
10. Ontario, Prince Edward Island, New Brunswick, North- Alberta (Human Rights and Citizenship Commission) v.
west Territories, and Alberta. Kellogg Brown & Root (Canada) Company, 2007 ABCA
426 (random drug and alcohol testing in safety-sensitive
11. For example, in Saskatchewan see Saskatchewan (Human
jobs is not prima facie discriminatory because the em-
Rights Commission) v. St. Paul Lutheran Home of Melville,
ployer did not perceive the employee to be disabled). Note
1993 CanLII 6669 (Sask. CA); and in Ontario see Ontario
that the tests regarding the right of employers to imple-
(Human Rights Commission) v. Vogue Shoes (1991), 14
ment random alcohol- and drug-testing policies differ in
CHRR D/425 (Ont. Bd Inq), where “physical disability”
the unionized setting, where labour arbitrators have de-
was restricted to that caused by injury, birth defect, or
veloped their own approach: see Communications, Energy
illness, and obesity was found not to be a disability. In
and Paperworkers Union of Canada, Local 30 v. Irving Pulp
British Columbia, where no such restrictive language
& Paper, Ltd., 2013 SCC 34.
exists, the tribunal has accepted that obesity may be a
disability. See Dunlop v. Find and Kutzner (No. 4), 2009 19. Janzen v. Platy Enterprises Ltd., supra note 6; Ratzlaff v.
BCHRT 277; and Hamlyn v. Cominco Ltd. (Re) (1989), Marpaul Construction and another, 2010 BCHRT 13; Cun-
11 CHRR D/333 (BCCHR). ningham v. Royal Canadian Legion Branch 594 (1993), 20
CHRR D/239 (Ont. Bd Inq); Rodley v. Barclay (1993), 19
12. Poulter v. JACI Enterprises Inc. (1989), 10 CHRR D/6141
CHRR D/503 (Ont. Bd Inq); Miller v. Sam’s Pizza House
(BCHRC).
(1995), 23 CHRR D/433 (NS Bd Inq); Costigane v. Nyood
13. In some jurisdictions, “perceived disability” is expressly Restaurant & Bar, 2015 HRTO 420; and Valle v. Faema
included in the statute, whereas in others the tribunal has Corporation 2000 Ltd., 2017 HRTO 588. See also
read the prohibition on disability discrimination broadly A. Aggarwal, Sexual Harassment in the Workplace
to include perceived disability. See, for example, Dumais v. (Toronto: Butterworths, 1987).
Speedy Auto and Window Glass, 2004 BCHRT 47; Gill v.
20. British Columbia (Public Service Employee Relations Com-
Royal Canadian Legion Charlottetown Branch No. 1, 2006
mission) v. BCGSEU, [1999] 3 SCR 3 (women have more
CanLII 61046 (PEHRC); Quebec (Commission des droits de
difficulty meeting a physical fitness test than men); and
la personne et des droits de la jeunesse) v. Montréal (City),
Chapdelaine v. Air Canada, 1987 CanLII 102 (CHRT) (the
2000 SCC 27; Bahlsen v. Canada (Minister of Transport),
height requirement for pilots indirectly discriminates
[1997] 1 FC 800; and Davis v. Toronto (City), 2011 HRTO
against women).
806.
21. Mottu v. MacLeod and Others, 2004 BCHRT 67; Bil v.
14. Entrop v. Imperial Oil Limited, 2000 CanLII 16800 (Ont.
Northland Properties, 2010 BCHRT 234, and see discus-
CA); and Watson v. Lawdell Services, 2013 BCHRT 82 at
sion in Re O.H.R. Com’n and Chrysalis Restaurant, 1987
para 48.
CanLII 5266 (Ont. Sup Ct J).
15. Francoeur v. Capilano Golf & Country Club (No. 2), 2008
22. CN v. Canada (Canadian Human Rights Commission),
BCHRT 171.
[1987] 1 SCR 1114.
16. See, for example, Ontario Nurses’ Association v. Cambridge
23. Brooks v. Canada Safeway Ltd., [1989] 1 SCR 1219. Brooks
Memorial Hospital, 2019 ONSC 3951; Regional Munici-
overruled a previous decision, Bliss v. Attorney General of
pality of Waterloo (Sunnyside Home) v. Ontario Nurses’ As-
Canada, [1979] 1 SCR 183, in which the Supreme Court
sociation, 2019 CanLII 433 (Ont. LA); and Krieger v.
ruled that pregnancy was not included in “sex” discrimina-
Toronto Police Services Board, 2010 HRTO 1361 (violent
tion. See Ontario HRC, s. 10(2).
conduct of employee was related to an undiagnosed
mental disability). For cases where no linkage between a 24. Brooks v. Canada Safeway Ltd., supra note 23 at 1243-44.
disability and the employee’s misconduct was found, see 25. McIlwraith v. Eva’s Restaurant and Lounge, 2006 CanLII
British Columbia (Public Service Agency) v. British Col- 61048 (PEHRC) (termination, shift change); Mann v. JACE
umbia Government and Service Employees Union, 2008 Holdings, 2012 BCHRT 234; Meldrum v. Astro Ventures,
BCCA 357 (termination of an alcoholic who stole alcohol 2013 BCHRT 144; Ontario Cancer Treatment and Research
is not discriminatory), decided prior to the Elk Valley deci- Foundation v. Ontario (Human Rights Comm.), 1998
sion, supra note 2; Watson v. Lawdell Services, supra note CanLII 14955 (Ont. Sup Ct J) (the refusal of sick benefits
14; and Fleming v. North Bay (City), 2010 HRTO 355. to a pregnant employee was discriminatory); and Weihs v.
17. See also Burton v. Tugboat Annie’s Pub and Others, 2016 Great Clips and Others (No. 2), 2019 BCHRTA 125.
BCHRT 78 (no link between termination for smoking 26. Janzen v. Platy Enterprises Ltd., supra note 6. Ontario
marijuana at work and the termination). Human Rights Commission v. Farris, 2012 ONSC 3876; J.D.

v. The Ultimate Cut Unisex, 2014 HRTO 956; Robichaud v. permitted forced retirement were challenged as violations
Canada (Treasury Board), [1987] 2 SCR 84; Bannister of the equality provision in the Charter of Rights and Free-
v. General Motors of Canada Ltd., 1998 CanLII 7151 (Ont. doms on a number of occasions. We will discuss these
CA); and Anderson v. Law Help Ltd., 2016 HRTO 1683. cases in Chapter 39 which examines the Charter. See, for
27. Janzen, supra note 6. example, McKinney v. University of Guelph, [1990] 3 SCR
229; Harrison v. University of British Columbia, [1990] 3
28. Québec (Commission des droits de la personne) v. Habachi,
SCR 451; and Stoffman v. Vancouver General Hospital,
1992 CanLII 1 (Que. TDP).
[1990] 3 SCR 483.
29. Dutton v. British Columbia (Human Rights Tribunal), 2001
41. See, for example, Ontario Human Rights Commission,
BCSC 1256; Rampersadsingh v. Wignall, 2002 CanLII
Time for Action: Advancing Human Rights for Older Ontar-
23563 (CHRT); and Wigg v. Harrison (1999), CHRR Doc.
ians (Toronto, ON: Ontario Human Rights Commission,
99-188e (NS Bd Inq).
2001), online: <http://www.ohrc.on.ca/en/
30. See, for example, Kafer v. Sleep Country Canada and time-action-advancing-human-rights-older-ontarians>.
another (No. 2), 2013 BCHRT 289 (the female complainant
42. Link found when employee in her 60s denied a posting for
regularly participated in sexual banter, and therefore the
which she was obviously qualified: Cowling v. Her Majesty
tribunal found such banter not “unwelcome”).
the Queen in Right of Alberta as represented by Alberta
31. McIntosh v. Metro Aluminum Products and another, 2011 Employment and Immigration, 2012 AHRC 12. No link
BCHRT 34; and Cugliari v. Telefficiency Corporation, 2006 between age and adverse effect: Ouellette v. IBM Canada
HRTO 7. Limited, 2017 HRTO 391; Lunar v. Canadian Real Estate
32. See, for example, Fair Employment Practices Act, SO 1951, Investment Trust, 2012 HRTO 28; and Riddell v. IBM
c. 24. Canada, 2009 HRTO 1454.
33. See the discussion in CSWU Local 1611 v. SELI Canada 43. Riddell v. IBM Canada, supra note 42 at para 117.
and Others (No. 8), 2008 BCHRT 436 at paras 237, 238; 44. Huang v. 1233065 Ontario Inc. (Ottawa Senior Chinese
Chieriro v. Michetti, 2013 AHRC 3; Francis v. BC Ministry Cultural Association), 2006 HRTO 1 (Falun Gong); and
of Justice (No. 3), 2019 BCHRT 136; and Eva obo Others v. R.C. v. District School Board of Niagara, 2013 HRTO 1382
Spruce Hill Resort and Another, 2018 BCHRT 238. (atheism). In Saskatoon Board of Police Commissioners v.
34. See Hadzic v. Pizza Hut, 1999 BCHRT 44; Dhillon v. F. W. Saskatoon Police Association, 2018 CanLII 128218 (Sask.
Woolworth Co. (1982), 3 CHRR D/743 (Ont. Bd Inq); LA), the employee claimed that her religion prohibited her
Islam v. Big Inc. 2013 HRTO 2009 (derogatory comments from carrying a gun, and this was accepted as a religious
about employees’ native language discriminates on basis of belief.
ethnic origin); and Sangha v. Mackenzie Valley Land and 45. Syndicat Northcrest v. Amselem, 2004 SCC 47.
Water Board, 2007 FC 856 (a denial based on overqualifi-
46. Central Alberta Dairy Pool v. Alberta, [1990] 2 SCR 489.
cation is discriminatory).
See also Henry v. Consumer Contact ULC, 2013 HRTO
35. Perez-Moreno v. Kulczycki, 2013 HRTO 1074. 994; Islam v. Big Mac, supra note 34; and Ont. Human
36. See, for example, Human Rights Act, SBC 1969, c. 10, s. Rights Comm. v. Simpson-Sears, supra note 8.
5(b); and Age Discrimination Act, SO 1966, c. 3, s. 1. 47. Loomba v. Home Depot Canada, supra note 1.
37. See Age of Majority Act, RSBC 1996, c. 7; and Age of Ma- 48. Jazairi v. Ontario (Human Rights Commission), 1999
jority and Accountability Act, RSO 1990, c. A.7, s. 1. CanLII 3744 (Ont. CA).
38. For a review of the arguments for and against allowing dis- 49. See “Employee Cites Ethical Veganism as a Creed,” Law
crimination against workers 65 and older, see M. Gunder- Times (May 2019), online: <https://www.lawtimesnews
son & J. Pesando, “The Case for Allowing Mandatory .com/practice-areas/human-rights/employee-cites-
Retirement” (1988) 14 Can Pub Pol’y 33; M. Krashinsky, ethical-veganism-as-a-creed/263533>.
“The Case for Eliminating Mandatory Retirement: Why
50. See, for example, Mark v. Porcupine General Hospital
Economics and Human Rights Need Not Conflict” (1988)
(1984), 6 CHRR D/2538; and Brossard (Town) v. Quebec
14 Can Pub Pol’y 40; and C.T. Gillin, D. MacGregor, & T.
(Commission des droits de la personne), [1988] 2 SCR 279.
Klassen, eds, Time’s Up! Mandatory Retirement in Canada
(Toronto, ON: Lorimer, 2005). 51. B. v. Ontario (Human Rights Commission), supra note 8.
39. Canada Pension Plan, RSC 1985, c. C-8, s. 44. 52. For a history of “family status” as a prohibited ground, see
the discussion in Garrod v. Rhema Christian School (1991),
40. See the discussion in A. Sheppard, “Mandatory Retire-
15 CHRR D/477 (Ont. Bd Inq).
ment: Termination at 65 Is Ended, but Exceptions Linger
On” (2008) 41 UBC L Rev 139. Age definitions that 53. In Devaney v. ZRV Holdings Limited, 2012 HRTO 1590, the
tribunal found prima facie discrimination on the basis of

“family status” when an employee was dismissed for 60. See, for example, Fraser v. BC Ministry of Forests, Lands
absenteeism due to elder-care responsibilities. Contrast and Natural Resource Operations (No. 4), 2019 BCHRT
Misetich v. Value Village Stores Inc., 2016 HRTO 1229 (no 140; and Wali v. Jace Holdings, 2012 BCHRT 389 (com-
discrimination when schedule interfered with employee’s ments about regulation of a profession is political). But see
care for her elderly mother). Prokopetz and Talkkari v. Burnaby Firefighters’ Union and
54. Simpson v. Pranajen Group Ltd. o/a Nimigon Retirement City of Burnaby, 2006 BCHRT 462 (complaints about
Home, 2019 HRTO 10; Canada (Attorney General) v. John- human resource policies are not “political”).
stone, 2014 FCA 110; and Canadian National Railway 61. Gajecki v. Surrey School District (No. 36) (1989), 11 CHRR
Company v. Seeley, 2014 FCA 111. See also Health Sciences D/326 (BCCHR). See also Liu v. Everlink Services Inc.,
Assoc. of B.C. v. Campbell River and North Island Transi- 2014 HRTO 202 (discrimination against an employee of
tion Society, 2004 BCCA 260; Rawleigh v. Canada Safeway Chinese descent was due to the employee’s accent); and
Limited, 2009 AHRC 6; Clark v. Bow Valley College, 2014 Ontario Human Rights Commission, “Policy on Dis-
AHRC 4; and Envirocon Environmental Services, ULC v. crimination and Language” (2009), online: <http://www
Suen, 2019 BCCA 46 (in British Columbia, the test .ohrc.on.ca/en/policy-discrimination-and-language
requires that there be a change in work rules and a serious ?page=lang-INTRODUC.html>.
interference with a substantial parental obligation). 62. Arnold v. Stream Global Services, 2010 HRTO 424; and
55. See, for example, Misetich v. Value Village Stores Inc., supra Clarke v. Garderie Tunny’s Daycare, 2013 HRTO 325.
note 53; Durikova v. BC Ministry of Justice, 2018 BCHRT 63. Ontario HRC, supra note 5, s. 10(1). See also de Pelham v.
258; and SMS Equipment Inc. v. Communications, Energy Mytrak Health Systems, 2009 HRTO 172 (“record of of-
and Paperworkers Union, Local 707, 2015 ABQB 162. fences” does not apply to a person merely charged with a
56. Vriend v. Alberta, [1998] 1 SCR 493. See also Haig v. crime). The code still refers to “pardons,” although amend-
Canada, 1992 CanLII 2787 (Ont. CA). ments to the federal Criminal Records Act, RSC 1985, c.
57. Selinger v. McFarland, 2008 HRTO 49. C-47, in 2012 changed the name of a pardon to a “record
suspension.”
58. See the discussion of the scope of these grounds by the
Ontario Human Rights Commission in “Gender Identity 64. Human Rights Code, RSBC 1996, c. 210, s. 13(1). This lan-
and Gender Expression” (2014), online: <http://www guage has been interpreted to include people merely
.ohrc.on.ca/en/gender-identity-and-gender-expression charged with an offence. See Clement v. Jackson and
-brochure>. See also F. Durnford, “The Mirror Has Many Abdulla, 2006 BCHRT 411.
Faces: Recognizing Gender Identity in Canadian Anti- 65. Human Rights Act, RSY 2002, c. 116, s. 13(1).
Discrimination Law” (2005), CanLII Docs 10.
59. Browne v. Sudbury Integrated Nickel Operations, 2016
HRTO 62.


CHAPTER 23
The Bona Fide Occupational Requirement,

the Duty to Accommodate, and Other
Discrimination Defences*
II. The Bona Fide Occupational Requirement (BFOR) Defence 374
• Describe the bona fide occupational requirement (BFOR) defence
A. The 1999 “Meiorin Test” for the BFOR 375
to a finding of prima facie discrimination and when it
B. The Duty to Accommodate 376
applies, including the duty to accommodate to the point of
III. The Special Interest Organization Defence 384
undue hardship.
IV. Other Defences to Prima Facie Discrimination 386
• Explain the “Meiorin test” for the BFOR. A. The Nepotism Defence 386
• Understand how the duty to accommodate affects employers, B. The Personal Care Attendant Defence, Homeworker Defence, and
unions, the employee seeking accommodation, and co-workers. Domestic Worker Defence 387
• Describe the key factors considered when determining whether C. The Bona Fide Pension or Insurance Plan Defence 387
an accommodation causes “undue hardship.” D. The Special Program Defence 387
• Describe additional defences available in Canadian human rights V. Chapter Summary 388
legislation, including the special interest organization defence, Questions and Issues for Discussion 388
the nepotism defence, the personal care worker defence, and Notes and References 389
the defence for bona fide pension or insurance plans.
I. Introduction
In Chapter 22 we introduced a two-step model for analyzing human rights cases at work. In the
first step, the complainant (usually an employee) must demonstrate a prima facie case of dis-
crimination on the basis of a prohibited ground. If the complainant can satisfy this test, the onus
shifts to the respondent (usually the employer) to defend that discrimination. In order to justify
discrimination, the employer must prove that a defence available in the jurisdiction’s human
rights statute is applicable. This chapter examines the types of defences available to employers
who have been accused of discrimination based on a prohibited ground. The most applied de-
fence is the bona fide occupational requirement (BFOR) defence. It permits some types of dis-
crimination on prohibited grounds when the purpose of the offending rule, standard, or practice
is related to a legitimate business concern. Other defences apply in more specific and narrow
circumstances. Box 23.1 reproduces the model from Chapter 22 and incorporates these defences
and exemptions.
* This chapter was authored by Michael Lynk, Western University, and David Doorey.
373


A Two-Step Model for Analyzing Human Rights Cases, Including Statutory Defences
When applying the two-step analysis to cases involving alleged work-related discrimination, human rights tribunals and courts
may encounter a number of defences to that discrimination.
QUESTION ONE (Chapter 22)

Human rights legislation
Does a rule, standard, or practice discriminate against the complainant NO does not apply.
on the basis of a prohibited ground in the human rights statute?
YES
QUESTION TWO (Chapter 23)

The discrimination is a violation
Is that discrimination nevertheless permitted by a statutory defence NO of the human rights statute.
or an exemption in the human rights statute?
Statutory defences/exemptions:
• Bona fide occupational requirement (BFOR) defence
(includes a duty to accommodate)
• Special interest organization defence
• Nepotism defence
• Personal care attendant defence, homeworker defence,
and domestic worker defence
• Bona fide pension or insurance plan defence
• Special program defence
YES
The discrimination is not a violation

of the human rights statute.
The range of possible defences available to an employer accused of unlawful discrimination

depends on the nature of the discrimination involved. Some defences (e.g., the nepotism de-
fence) apply to a precise type of discrimination. By contrast, the BFOR defence is more versatile
and has potential application to a wide range of employment rules, standards, and practices that
give rise to a prima facie case of discrimination on a prohibited ground. As we will learn, an
important element of the BFOR defence is the “duty to accommodate” to the point of undue
hardship. We will begin with a discussion of the BFOR defence before turning to the additional
situational defences.
II. The Bona Fide Occupational Requirement (BFOR) Defence

The main lesson to take away from this chapter is that the right not to be discriminated against
is not absolute. Human rights statutes attempt to strike a balance between potentially competing
rights. In the employment context, this balancing sometimes pits the employer’s business and
efficiency interests against the interests of individual workers to engage in paid labour without
discrimination. The tension that can arise from this balancing exercise is nowhere more clearly

Chapter 23 The Bona Fide Occupational Requirement, the Duty to Accommodate 375
evident than in relation to the bona fide occupational requirement (commonly known by its
acronym, BFOR).1
Employers rely on the BFOR more than any other defence. This defence permits discrimin-
ation on a prohibited ground when that discrimination is based on an honest good-faith belief
that it is necessary for a legitimate business reason. The BFOR defence appears in human rights
statutes as an expressed exemption from the general rule that discrimination in employment
based on prohibited grounds is unlawful. For example, the British Columbia Human Rights
Code provides that the rules prohibiting discrimination in employment “do not apply with re-
spect to a refusal, limitation, specification or preference based on a bona fide occupational
requirement.”2 Similar language is found in other Canadian human rights statutes. The Ontario
Human Rights Code’s BFOR defence model is the most complicated because it is divided into
several sections, as summarized in Box 23.2.

The Bona Fide Occupational Requirement Defence in the Ontario Human Rights Code
The Ontario Human Rights Code divides up the BFOR defence tion to which section applies to a particular situation and,
into three distinct sections that deal with different types of equally, when the defence does not apply. For example, in
discrimination, as follows: Ontario the BFOR defence is only available in cases of direct
• Section 11: Indirect discrimination based on all pro- discrimination if the grounds involved are disability (s. 17), sex,
hibited grounds. age, record of offence, and marital status (s. 24(1)(b)).
• Section 17: Direct discrimination based on disability
when a disabled employee cannot perform the essen- * The Ontario Court of Appeal has ruled that s. 17 of the code applies to
tial duties of a job.* direct discrimination on the basis of disability and s. 11 applies to
• Section 24(1)(b): Direct discrimination based on age, indirect discrimination: Ontario Nurses’ Association v. Orillia Soldiers
sex, record of offence, and marital status. Memorial Hospital, 1999 CanLII 3687 (Ont. CA); and Entrop v. Imperial Oil
Limited, 2000 CanLII 16800 (Ont. CA).
In practice, the BFOR defence is applied in a similar manner
under all three sections, although it is important to pay atten-
A. The 1999 “Meiorin Test” for the BFOR

The leading case on the BFOR defence was decided by the Supreme Court of Canada in 1999,
as described in Box 23.3.

The Scope of the Bona Fide Occupational Requirement Defence
British Columbia (Public Service Employee Relations three of the tests, but was unable to meet a fourth test standard
Commission) v. BCGSEU (The Meiorin Decision) that required running 2.5 kilometres in 11 minutes. She was 49
[1999] 3 SCR 3 seconds late. She was fired for failing to meet the standard. She
filed a grievance, and her union argued before an arbitrator
Key Facts: Meiorin was hired as a firefighter in 1992 by the that the standard was discriminatory against women because
British Columbia Ministry of Forests and performed well in her women were much less likely to be able to meet the standard.
first couple of years on the job. In 1994, the BC government Evidence bore this out: 65 to 70 percent of men passed the test
introduced new aerobic fitness standards for firefighters and compared with only 35 percent of women. The arbitration tri-
required all employees to take a fitness test. Meiorin passed bunal ruled that the aerobic standard discriminated against
bona fide occupational requirement (BFOR): A defence to discrimination that an employer may use to prove that a discriminatory rule, standard,
or practice was enacted for legitimate business reasons; it requires that the employer prove that it cannot accommodate the complainant’s needs without
causing itself undue hardship.

women and ordered Meiorin to be reinstated to her job. That the demonstration that it is impossible to accommodate
ruling was overturned by the BC Court of Appeal, and the case the employee without imposing undue hardship on the
came before the Supreme Court of Canada. employer.
Issue: Did the aerobic fitness standard discriminate against Applying this new test, the Supreme Court ruled that the
women and, if so, was that discrimination justified as a BFOR? employer had failed to establish a BFOR defence. The govern-
ment satisfied the first and second elements: (1) the fitness
Decision: Yes and no. The Supreme Court found that the stan- standards were adopted to help the employer identify those
dards in the test discriminated on the basis of sex. It introduced employees who are most fit and therefore best able to perform
a new test that is to be used to decide whether a workplace the job safely and efficiently, and (2) there was no suggestion
standard that is prima facie discriminatory (either directly or that the employer acted in bad faith in adopting the standard.
indirectly) justifies as a BFOR. That test requires the employer However, the employer had failed to show that running 2.5
to establish the following: kilometres in 11 minutes, as opposed to 11 minutes and 49
seconds, was reasonably necessary to the safe and efficient
1. that the employer adopted the standard for a purpose performance of firefighting. The evidence did not establish that
that is rationally connected to the performance of the job; if a different standard were applied to all firefighters, or to just
2. that the employer adopted the standard in an honest female firefighters, the safe performance of the job would not
and good-faith belief that it was necessary to the fulfill- be possible. Therefore, the employer could not rely on the BFOR
ment of that purpose; and defence. The original decision to reinstate Meiorin to her job
3. that the standard is reasonably necessary to the accom- with back pay was ordered.
plishment of that legitimate purpose, which requires
The so-called “Meiorin test” includes both a subjective and an objective component:
• Objective component (steps one and three of the Meiorin test): This component focuses on
whether the standard is truly necessary to achieve a legitimate business-related objective.
It asks whether the purpose of the standard is “rationally connected” to the performance
of the job and, if so, whether it is “reasonably necessary” to apply the standard to the
complainant to achieve that purpose, considering the duty to accommodate to the point
of undue hardship.
• Subjective component (step two of the Meiorin test): This component examines the
employer’s motive and state of mind when it adopted the standard being challenged. Was
the employer acting in good faith (trying to improve performance) rather than acting on
some other motive inconsistent with human rights legislation? This branch of the test is
usually satisfied.
A BFOR defence can fail at any one of the three steps in the Meiorin test, although most cases
come down to the question of whether the standard is “reasonably necessary,” and that inquiry
in turn focuses on whether it is possible for the employer to accommodate the worker without
undue hardship. For this reason, the legal duty to accommodate to the point of undue hardship
has emerged as one of the most important legal requirements in Canadian human rights law.
B. The Duty to Accommodate

The duty to accommodate to the point of undue hardship is likely the most litigated issue in
human rights law. Since its inception in Canadian law in 1985, this duty has embedded human
undue hardship: The legitimate defence that an employer may raise to justify why it could not provide an accommodation to
an employee. This standard is demanding and requires the employer to demonstrate that significant difficulties—beyond mere
inconvenience—would result if it had to accommodate the employee.

rights values into the core of the employment relationship, transformed industrial relations
practices, and broadened the reach of the law of work. The duty to accommodate is guided by
the following objectives: removing barriers, eradicating prejudices and stereotypes, ending dis-
crimination in all its forms, broadening opportunities, enhancing diversity, and entrenching
equality at work. Most significantly, it has required employers to proactively ensure that barriers
to employees’ equal participation in the workplace are removed. According to the Supreme
Court, “employers designing workplace standards owe an obligation to be aware of both the
differences between individuals, and differences that characterize groups of individuals. They
must build conceptions of equality into workplace standards.”3 There is hardly a workplace in
Canada that has not been touched by the duty to accommodate.
At times, the required accommodation is relatively simple. An employer might need to
reschedule the employee from the night shift to the day shift because overnight child-care
options for the employee’s young child are limited. It might need to purchase adaptive software
and hardware for a sight-impaired bookkeeper. Or it might need to rearrange work hours to
allow a Muslim employee to attend noon prayers at the local mosque. Other times, the required
accommodation can be more complex. A hospital might need to modify the job of a nurse
returning to work after major back surgery, perhaps requiring the other nurses on her shift to
assume her heavy duties, such as lifting patients. A fire department might need to revise its
height, weight, and aerobic standards if those standards unnecessarily hinder women from
becoming firefighters. An employer with offices in an older building can be mandated to con-
struct elevators, build ramps around stairs, create wider aisles, and purchase lower work tables
to accommodate an employee in a wheelchair.
1. What Is “Undue Hardship”?

The threshold to satisfy the duty to accommodate, “undue hardship,” is rigorous and not easy to
satisfy. Undue hardship recognizes that some hardship is anticipated.4 The threshold of “undue”
hardship is reached only when all reasonable measures of accommodation have been attempted
and exhausted, and providing any more accommodation would impose an unnecessarily
demanding level of hardship on the employer.5 The Supreme Court listed six factors to consider
when determining undue hardship, recognizing that the list was not exhaustive (more factors
could be added later).6 These factors and their content have been fleshed out through subse-
quent rulings by legal decision makers:
• Safety: This is the most common undue hardship factor relied on by employers. To suc-
ceed, the employer must establish that the proposed accommodation presents an intoler-
able safety risk either to the employee seeking the accommodation or to others.7
• Size of the employer’s operations: The larger the operation, the more likely it would be that
the employer can afford or arrange for a viable accommodation.8
• Employee morale: The impact of a proposed accommodation on other employees can
amount to undue hardship, but only if the impact is significant. If other employees
oppose the accommodation because of a preference for the status quo or a discriminatory
attitude, then the impact on employee morale will not amount to a legitimate
hardship.9
• Interchangeability of the workforce and facilities: This factor asks whether the workforce,
and the nature of the workplace operations, is large enough, complex enough, and adapt-
able enough to implement a flexible work schedule or a rebundling of work assignments
without undue hardship.
• Cost: To amount to an undue hardship, the cost of an accommodation must be so signifi-
cant that it would impact the financial viability of the enterprise.10 The financial threat
of an expensive accommodation must be grounded on proven accounting evidence, not
impressions or assumptions.11

• Infringement of a collective agreement: Collective agreement provisions in a unionized

workplace are to be respected, but a viable accommodation can override the provisions
of a collective agreement unless the proposed accommodation would significantly inter-
fere with the rights of other employees.12
2. A (Very) Brief History of the Duty to Accommodate

The roots of the duty to accommodate lie in a series of Supreme Court decisions from the 1980s
and 1990s. Until 1985, human rights law in Canada required victims of discrimination to estab-
lish a demanding standard: they had to prove the employer had intentionally discriminated
against them. As well, no legal requirement existed for employers to accommodate employees.
The requirement that a complainant prove that a defendant intended to discriminate and the
absence of a duty for employers to accommodate employees ensured that human rights statutes
remained in the backwaters of Canadian law, with little legal bite or impact. That changed in the
groundbreaking Supreme Court decision Ont. Human Rights Comm. v. Simpsons-Sears
(“O’Malley”), described in Box 23.4.

Establishing the Principles of the Duty to Accommodate in Canada
Ont. Human Rights Comm. v. Simpsons-Sears (“O’Malley”) intentional discrimination (discussed in Chapter 21) was now
[1985] 2 SCR 536 part of Canadian law. Thus, an employer would be in violation
of the Ontario Human Rights Code even though the offending
Key Facts: Since 1975, O’Malley had worked as a full-time retail rule—”all employees must be available to work on Friday and
clerk at a Simpsons-Sears store in Kingston. The store operated Saturday shifts”—was implemented without any discrimina-
throughout the week, including Thursday, Friday, and Saturday tory intent. The court stated:
evenings, as well as all day on Saturdays. In 1978, O’Malley
joined the Seventh-day Adventist Church. A mandatory tenet An employment rule honestly made for sound eco-
of the church was the observation of its Sabbath, which ran nomic or business reasons, equally applicable to all
from sundown Friday to sundown Saturday. Among other re- to whom it is intended to apply, may yet be dis-
quirements, a church member could not work during the criminatory if it affects a person or group of persons
Sabbath. When O’Malley asked her managers to realign her differently from others to whom it may apply.
work schedule as an accommodation, they replied that Fridays
The Supreme Court then held that human rights law would
and Saturdays were busy commercial days and its mandatory
now include a general duty to accommodate. Once a work-
work rule required all employees to be available for work dur-
place rule was found to cause an adverse effect on an em-
ing all store hours. Instead of accommodating her needs, the
ployee, an employer was required to accommodate the
employer reassigned her as a part-time employee, with the
employee, up to the point of undue hardship. It also stated:
consequent reduction in working hours, income, and benefits.
A human rights board of inquiry dismissed O’Malley’s dis- [W]here it is shown that a working rule has caused
crimination complaint against Simpsons-Sears, and that deci- discrimination it is incumbent upon the employer
sion was appealed up to the Supreme Court of Canada. to make a reasonable effort to accommodate the
religious needs of the employee, short of undue
Issues: Is indirect, non-intentional discrimination prohibited hardship to the employer in the conduct of his
by Canadian human rights law? If so, is an employer required business.
to accommodate an employee who is the victim of indirect
discrimination? Did Simpsons-Sears discriminate against The court found that Simpsons-Sears had not produced
O’Malley? any evidence that accommodating O’Malley’s religious beliefs,
such as maintaining her full-time hours while ensuring that
Decision: Yes to all three questions. The court allowed she was not assigned work on the Sabbath, would have caused
O’Malley’s appeal, stating that the doctrine of indirect, non- it any undue costs or scheduling problems.

The O’Malley decision was a giant step forward for human rights law in Canada. The decision
introduced a duty to accommodate as an element of the BFOR defence in the case of indirect
discrimination. It took some 14 years later, in the Meiorin decision discussed in Box 23.3, for the
Supreme Court to extend the duty to accommodate to the BFOR defence in cases involving
direct discrimination.13 Today, the duty applies in any case where the employer argues the BFOR
defence developed in the Meiorin decision. In the years following the O’Malley decision, human
rights tribunals, labour arbitrators, and courts filled in details about the content and scope of the
duty to accommodate. In the 1992 decision Central Okanagan School District No. 23 v. Renaud
(Box 23.5), the Supreme Court again considered religious accommodation and this time dis-
cussed who was responsible for accommodation, as well as the effect of collective agreements
between unions and employers on the duty.

Who Has a Duty to Accommodate?
Central Okanagan School District No. 23 v. Renaud accommodation must be waived if no other accommodation
[1992] 2 SCR 970 is available and if waiving it will not cause undue hardship on
the employer. An accommodation that violates a contract term
Key Facts: Renaud, an employee at a unionized workplace (a can cause undue hardship if it involves a “substantial departure
school board), requested Friday evenings off because his Sev- from the normal operation of the conditions and terms of
enth-day Adventist faith prohibited work from Friday evening employment,” since this may “constitute undue interference in
to sundown Saturday. The only practical shift available that the operation of the employer’s business.” However, there was
could allow the employee to work full time and have Friday no evidence that allowing the employee to work Sunday to
evenings off was a Sunday to Thursday shift. However, assign- Thursday would cause undue interference with the employer’s
ing the employee to that shift would have involved violating business.
part of the union’s collective agreement and granting the If an accommodation proposal would cause “undue inter-
employee a preferred shift for which he lacked the seniority ference” with the rights of other employees or would seriously
(length of service). The union threatened to file a grievance if affect employee morale, then it could constitute undue hard-
the employer assigned the employee to the Sunday to Thurs- ship. However, employees are not entitled to insist that the
day shift, so the employer fired the employee. The employee employer be in absolute compliance with the collective
filed a religious discrimination complaint under the BC Human agreement, and sometimes co-workers must participate in
Rights Code against the employer and the union. The employee accommodation of their colleagues. Moreover, there was no
won before the human rights tribunal, and that decision was evidence that allowing the employee to work Sunday to
appealed up to the Supreme Court of Canada. Thursday would seriously interfere with other employees’
rights. A union has an obligation to cooperate with the em-
Issue: Does the duty to accommodate sometimes require vio- ployer to identify a reasonable accommodation and to waive
lating a collective agreement to enable accommodation, and collective agreement requirements if necessary, provided that
is a union obligated by that duty to participate in the accom- doing so will not cause undue hardship to other employees
modation process? (the union had not asked other employees if they would cover
the Friday night shift). The employee seeking accommodation
Decision: Yes and yes. The Supreme Court found that the rule has an obligation to accept a reasonable accommodation. The
requiring Friday work indirectly discriminated on the basis of court noted that the complainant “cannot expect a perfect
religion. The issue boiled down to whether any accommoda- solution” and that if a reasonable accommodation is proposed
tion was available to enable the employee to work full time and the employee turns it down, “the employer’s duty is
but still have Fridays off. The employer identified a solution— discharged.”
the Sunday to Thursday shift—but that would entail a breach The Supreme Court agreed with the tribunal that allowing
of the collective agreement, which the union rejected. the employee to work Sunday to Thursday would not have
The court ruled that a collective agreement term “cannot imposed undue hardship on the employer, the union, or the
absolve the parties from the duty to accommodate,” since no other employees. The employer and union were equally liable
one can contract out of human rights legislation obligations. for the employee’s lost wages, and the employer was ordered
Therefore, a contract term that stands as an obstacle to to reinstate the employee to the Sunday to Thursday shift.

In Renaud, the Supreme Court explained that accommodation is everyone’s business. The
general scope of the parties’ duties can be briefly summarized as followed:
• Employer’s duty: To be flexible in exploring all options to modify jobs and schedules and
to provide devices and other measures that will enable an employee to perform the es-
sential duties of a job, subject to undue hardship, and to proactively educate the work-
place on the need for accommodation.14
• The worker seeking accommodation: To participate reasonably in their own accommoda-
tion, to provide the employer with information necessary for the employer to assess
possible accommodation measures, and to accept reasonable accommodation. The
worker is not entitled to their preferred accommodation, only reasonable
accommodation.15
• Unions: To cooperate with the worker and employer in seeking accommodation meas-
ures, including making exceptions to collective agreement provisions if no other accom-
modation is possible and this would not cause undue hardship.16
Co-workers of the person seeking accommodation may also be required to shoulder some of
the weight of an accommodation, such as by altering their work hours or performing additional
tasks if necessary, provided that doing so does not cause them undue hardship. As you can see,
the duty to accommodate imposes a substantial procedural duty (to investigate the employee’s
restrictions and explore all alternatives) and substantive duty (to make changes to how work is
performed).
3. The Duty to Accommodate Disabilities

After Central Alberta Dairy Pool and Renaud, the duty to accommodate quickly became a cen-
tral feature of human rights law at work. Human rights tribunals and labour arbitration boards
applied the principles from those rulings in scores of decisions that developed the details of
this duty. The largest number of accommodation cases have dealt with workers with a dis-
ability. The reasons for the high volume of disability accommodation cases are twofold. First,
the types of disability are numerous, and the needs of each individual are specific, which makes
accommodation for this protected ground more complex than for other grounds. The accom-
modation required for a bad back will be quite different from that required for depression, a
substance addiction, or chronic fatigue syndrome. Second, disabilities are usually more
mutable than other human rights grounds, which means their accommodation requirements
often change: a bad back can heal or get worse, and an addiction can be managed or go through
a relapse.
Accommodations for employees with disabilities take as many forms as there are distinct
disabilities. When the disabled employee is still capable of working, the duty to accommodate
requires a survey of the workplace to identify work possibilities. When an employer is investi-
gating the possibilities for a job accommodation, it must engage in a four-step process:
1. The employer determines whether the employee can productively fulfill his or her
existing job as it is presently constituted.
2. If not, the employer determines whether the employee can perform the essential aspects
of the existing job in a modified or rebundled form.
3. If not, the employer determines whether the employee can accomplish the duties of
another job in its present form.
4. If not, the employer determines whether the employee could perform another job in a
modified or rebundled fashion.17
mutable: A condition that is liable to change.

In most cases, the employer will have legally fulfilled its duty to accommodate if it has thor-
oughly investigated and has been unable to satisfy the accommodation needs of an employee
after following these four steps.
When searching for an accommodation for an employee with a disability, an employer can
require that the employee be able to productively perform the core aspects or essential duties of
a proposed position. Generally speaking, and with some exceptions, the duty does not oblige
the employer to create an accommodation position that produces little or no value for the em-
ployer and amounts to a “make work” project,18 to hire a new worker to perform tasks a disabled
employee is unable to perform,19 or to displace existing employees to create a vacancy for
accommodation.20
Some types of disabilities create special challenges for accommodation. For example, if an
employee is unable to work at all due to a disability (known as innocent absenteeism), then the
four-step process discussed above will not be fruitful. The question then becomes, at what point
can an employer terminate a disabled employee who cannot work? The answer is that employers
must explore whether rehabilitation, medical treatments, or further rest would allow an employee
to return to work in the foreseeable future. Only if the evidence discloses that an employee with
a disability has been off work for a considerable time and that they will be incapable of returning
to a job, accommodated or otherwise, for the foreseeable future, will continued employment
constitute undue hardship for the employer.21
Accommodating mental disabilities poses different challenges. Employers must not make
assumptions about mental disabilities and instead must investigate and educate themselves
about the disability, and then fully explore what, if any, accommodations could enable the em-
ployee to continue working, as explained in the decision in Box 23.6.22

Accommodating an Employee with a Mental Disability
Lane v. ADGA Group Consultants Inc. lishing it could not accommodate Lane without undue hard-
2007 HRTO 34 ship. The tribunal noted that the duty to accommodate
includes both a “procedural” and a “substantive” duty. The
Key Facts: Lane was hired as a quality assurance analyst with procedural duty to accommodate includes gathering all rel-
ADGA Group Consultants in 2001. Several years before, he had evant information necessary to assess whether accommoda-
been diagnosed with bipolar disorder. During his first week of tion is possible. The employer failed to do so. Rather than seek
work, Lane informed his supervisor about his bipolar condition information about managing the disability, the employer
and explained some of the symptoms. Several days later, his rushed to judgment and promptly dismissed Lane.
employer fired him, stating that it was concerned that work- The employer also failed in its substantive duty to accom-
place stress might trigger a manic episode, and it could not modate. It did not demonstrate that monitoring Lane and then
easily endure an extended disability leave by Lane. Following calling his doctor or wife if there were signs of an episode would
his dismissal, Lane rapidly went into a full-blown bipolar mania cause it undue hardship. While there were some safety concerns
and, among other events, lost his marriage. He subsequently if Lane had an episode, they were not “serious” concerns. The
filed a complaint with the Ontario Human Rights Commission. tribunal concluded that the employer had not adequately ex-
plored the accommodation possibilities within its workplace.
Issue: Did the employer violate the Human Rights Code by Lane was awarded $35,000 in general damages, $10,000 for
dismissing Lane because of his mental condition? harm to Lane’s mental health, and an additional $40,511 in
special damages. These damages were upheld on the em-
Decision: Yes. The Ontario Human Rights Tribunal ruled that ployer’s appeal to the Ontario Superior Court of Justice.*
Lane had a disability and that disability had led to his termin-
ation. The employer argued that being able to work under
stress and without absence was a BFOR, which included estab- * ADGA Group Consultants Inc. v. Lane, 2008 CanLII 369605 (Ont. Sup Ct J).

The duty to accommodate employees with addictions usually includes granting the employee
time off work to attend a rehabilitation program, as well as an exploration of other measures to
ensure the employee does not present a safety risk to themselves or others. For example, in a
2019 decision, Regional Municipality of Waterloo v. Ontario Nurses Association, a nurse with a
narcotics addiction was terminated for stealing narcotics from her workplace.23 An adjudicator
ruled that there was a nexus between the employee’s addiction and the theft and therefore that
prima facie discrimination had been made out. The employer lost its BFOR defence because it
failed to demonstrate that it could not accommodate the employee’s addiction. The employer
did not canvass whether, after the employee completed a rehabilitation program, work arrange-
ments could be adjusted, such as ensuring the employee did not have unsupervised access to the
narcotics in the event of a relapse. The employee was reinstated to her job and the parties were
ordered to consider accommodation.
The decision in Box 23.7 considers the BFOR and the duty to accommodate in the context of
mandatory drug- and alcohol-testing policies, which, as we noted in Chapter 22, have been
found to discriminate on the basis of disability (addiction).

Is a Rule Requiring Mandatory Random Drug and Alcohol Tests for Employees in
Safety-Sensitive Positions a BFOR?
Entrop v. Imperial Oil Limited The employer’s BFOR defence argument failed. The first
2000 CanLII 16800 (Ont. CA) two parts of the Meiorin test were satisfied: the new policy
sought to reduce impairment in safety-sensitive jobs, which
Key Facts: Entrop had an alcohol-abuse problem, but he had was a legitimate purpose that was introduced in good faith
not had a drink in seven years. He worked in a safety-sensitive by the employer. However, the alcohol- and drug-testing pol-
job at an oil refinery. The employer introduced a new drug and icy did not satisfy the third part of the Meiorin test. The policy
alcohol policy that required workers in safety-sensitive jobs to was not “reasonably necessary” to ensure safe workplaces.
disclose past substance-abuse problems and take random The court explained:
drug and alcohol tests. When Entrop disclosed his prior alcohol
problems, he was transferred to a new job. He was eventually • Random drug testing was not “reasonably necessary”
reinstated to his former safety-sensitive position, but only on because drug testing does not measure current impair-
the condition that he agree to take random alcohol and drug ment but rather whether someone used drugs at some
tests. Entrop filed a human rights complaint alleging that point in the past. Also, the policy resulted in automatic
mandatory testing discriminated against him based on termination of any employee in a safety-sensitive job
disability. who tested positive without consideration of accom-
modation of the individual’s personal circumstances.
Issue: Did the employer’s alcohol- and drug-testing require- Therefore, the random drug-testing policy was dis-
ment discriminate on the basis of disability and, if so, was it criminatory and not a BFOR and was therefore illegal.
nevertheless a BFOR? The court accepted that drug testing could be a BFOR
if it is part of a broader assessment of whether an em-
Decision: The Ontario Court of Appeal confirmed that drug ployee previously in a work accident continues to
and alcohol addiction are disabilities and ruled that a random abuse drugs.
drug- and alcohol-testing policy that leads to negative em- • Random alcohol testing does test current impairment
ployment repercussions for any employee with a positive test and therefore is reasonable in safety-sensitive jobs (not
discriminates on the basis of disability. The policy is prima in non-safety-sensitive jobs). However, random alcohol
facie discriminatory because it assumes that an employee testing is only a BFOR if the employer meets its duty to
with a positive test is an addict who will later report to work accommodate any employee who is an alcoholic and
intoxicated, and based on this assumption it removes them who tests positive. Accommodation should include
from the job. Therefore, the onus shifted to the employer consideration of “sanctions less severe than dismissal
to demonstrate that its policy was a BFOR, applying the and where appropriate the necessary support to per-
Meiorin test. mit the employee to undergo a treatment program.”

4. The Duty to Accommodate Other Prohibited Grounds

While the duty to accommodate may get the most work in the context of disability discrimina-
tion complaints, it is by no means limited to disability. We have already seen several cases in
which the BFOR defence and the duty to accommodate were argued in the context of religious
discrimination (O’Malley and Renaud in this chapter, and Central Alberta Dairy Pool in Chapter
21). These cases involved requests by employees for time off from work to observe a religious
holiday or practice. Such accommodations can often be handled flexibly by permitting the em-
ployee to work at different times, if that is possible without causing the employer undue
hardship.24
The Supreme Court’s Meiorin decision (Box 23.3) not only redefined the scope of the duty to
accommodate but also became the leading decision on the accommodation of women in the
workplace. Meiorin established that the development of workplace measurements for employee
standards needs to incorporate the principles of equality. In that case, the BC Ministry of Forests
had not ensured that the new aerobic fitness test that it developed for its forest firefighters paid
attention to the aerobic differences between men and women. Consequently, the prevailing
aerobic fitness standard was struck down, and the ministry was ordered to develop a new stan-
dard with equality in mind. Many recent human rights rulings on gender in the workplace
involve pregnancy and accommodation. Employers cannot dismiss or unfavourably treat a
pregnant employee, and they must make every reasonable effort to ensure that a viable accom-
modation is made for that employee, including flexible scheduling or reassignment of duties, if
necessary.25
Table 23.1 summarizes additional Canadian human rights decisions in which the employee
established prima facie discrimination based on a prohibited ground and the employer argued
a BFOR defence. Pay close attention to whether the employer’s argument satisfied the Meiorin
test for a BFOR and how the decision makers applied the duty to accommodate to the point of
undue hardship.
TABLE 23.1 Examples of the Application of the BFOR Defence and Duty to Accommodate
Case Name Prohibited Summary
Ground
Saskatoon Board of Police Religion The employee joined the Living Church of God, which restricted her from carrying guns.
Commissioners v. Saskatoon The employer rule requiring constables to carry guns indirectly discriminated against the
Police Association, 2018 employee. The employer proposes an accommodation in a “special constable” position
CanLII 128218 (Sask. LA) that doesn’t require a gun but which results in a demotion and a $20,000 per year pay cut.
The employer failed in its duty to accommodate by not maintaining the employee’s
position as constable and her pay while in the special constable position. In the past,
other constables had been accommodated in the same position without a demotion and
pay cut.
Markovic v. Autocom Manu- Religion The employer accommodated the employee’s religion by offering the employee a “menu” of
facturing, 2008 HRTO 64 options to make up for taking off Orthodox Christmas, including working an alternate day,
using vacation time, or switching shifts with a co-worker. The employee argued he should
receive the day off with pay without having to make it up because Christian employees get
Christmas Day off with pay. The employer satisfied the duty to accommodate by permitting
the employee to take the day off and offering options to earn back the pay.
Devaney v. ZRV Holdings Ltd., Family status The employer’s insistence that the employee work regular 8:30 a.m. to 5:00 p.m. shifts
2012 HRTO 1590 amounted to indirect discrimination on the basis of family status when the employee
needed to care for an elderly parent. The employer failed in its BFOR defence because it did
not consider and explore possibilities for accommodation and did not demonstrate that
undue hardship would result by allowing the employee to work flexible hours, as he done
in the past.

Jaques v. TOSH Steakhouse Sex A pregnant restaurant server requested accommodation in the “bar” area rather than in her
and Bar, 2016 HRTO 403 usual “dining room” area because she could not manage the stairs to and from the dining
room because of pregnancy-related health issues. The employer argued that working in the
dining room was a BFOR and it could not accommodate the employee because the bar area
was fully staffed and giving the pregnant employee shifts would disrupt other employees.
The tribunal ruled that the employer had discriminated against the employee and failed to
demonstrate that accommodation would cause undue hardship. There was no evidence
that the employee’s co-workers in the bar would be opposed to switching shifts if
requested during the period of the pregnancy.
Bastide v. Canada Post, Age An employer rule requiring employees to pass a dexterity test indirectly discriminated
2005 FC 1410 against older employees on the basis of age. A BFOR defence was successful because
evidence demonstrated a direct link between performance on the test and success in
the job. Accommodation by eliminating the test or lowering the standard would result in
undue hardship.
Mortland and VanRootselaar Age The employer had a mandatory retirement policy that terminated the employment of
v. Peace Wapiti School Division school bus drivers at age 65 based on a belief that this was necessary to ensure safety.
No. 76, 2015 AHRC 9 The rule discriminated on the basis of age. The employer’s BFOR defence failed. While the
employer adopted the rule for a purpose that was rationally connected to job performance
and in good faith, forced retirement was not reasonably necessary to ensure safety. The rule
was overbroad and not tailored to individual circumstances. The employer could use indi-
vidual testing to check for the presence of risks.
Landry v. Vegreville Autobody, Marital status, In a job interview, the employer expressed concern about hiring Landry, a gay applicant,
2017 AHRC 19 sexual because Landry’s husband was an RCMP officer who could be transferred to another city.
orientation The tribunal found that the employer expressed a preference to hire someone who was not
gay and married to a RCMP officer, amounting to sexual orientation and family status
discrimination. The BFOR defence failed. Being straight and not being married to an RCMP
officer were not “reasonably necessary” to perform the job. There was no rational connec-
tion between the employer’s preferences and job performance, and even if the possibility
of a short job was rationally connected to job performance, the employer did not demon-
strate that accommodating Landry in the job even with this risk would cause undue hard-
ship. Previous employees in the job had not stayed very long, and employers never have a
guarantee that employees will not leave.
III. The Special Interest Organization Defence

Some of the earliest Canadian human rights legislation included exemptions for charitable, edu-
cational, or religious organizations, as well as private social clubs and non-profits. For example,
the first federal Fair Employment Practices Act, enacted in 1951, excluded from its coverage
non-profit organizations that were “exclusively charitable, philanthropic, educational, fraternal,
religious, or social” or that were “operated primarily to foster the welfare of a religious or racial
group.”26 Exemptions for some special interest organizations still exist in Ontario, Quebec, Nova
Scotia, Prince Edward Island, Saskatchewan, and Newfoundland and Labrador, although the
types of organizations exempted and the specific conditions of the exemptions vary by jurisdic-
tion. The Supreme Court of Canada has stated that exemptions in human rights statutes for
certain types of organizations are intended to “promote the fundamental right of individuals to
freely associate in groups for the purpose of expressing particular views or engaging in par-
ticular pursuits.”27
For example, section 24(1)(a) of the Ontario Human Rights Code states that it is not unlawful
discrimination where
a religious, philanthropic, educational, fraternal or social institution or organization that is primarily

engaged in serving the interests of persons identified by their race, ancestry, place of origin, colour,
ethnic origin, creed, sex, age, marital status or disability employs only, or gives preference in employ-
ment to, persons similarly identified if the qualification is a reasonable and bona fide qualification
because of the nature of the employment.

This provision requires that the special types of employers listed in the section demonstrate
that a discriminatory practice is necessary and relevant to the performance of the job. There is
no duty to accommodate in this defence. As an example, a religious school that serves students
of a particular religion may be entitled to give hiring preference to members of that religion if
being of that religion is a requirement of the job. Religious conformity may be a BFOR for a
theology teacher in a religious-based school, but not for a secretary or janitor in the same
school.28 In the media story found in Box 23.9, the employer defended its decision to terminate
an employee for dating outside the religion, arguing that the job required absolute adherence to
its version of the religious doctrine. Box 23.8 describes the application of this defence in another
religious institution scenario.

Can a Religious Organization Discriminate on the Basis of Religion?
Ontario Human Rights Commission v. Christian Horizons Decision: No. It was true that CH was a “religious organization.”
2010 ONSC 2105 It was also primarily engaged in serving the interests of Evan-
gelical Christians, since the purpose of CH was to permit
Key Facts: Christian Horizons (CH) is an Evangelical Christian members of the church to perform their religious duty of serv-
organization that provides services to people with developing the needy. However, CH failed to establish that not being
mental disabilities. In 1992, CH introduced a new morality code homosexual was a reasonable and bona fide requirement of
for its employees that prohibited homosexuality. Heintz, an Heintz’s job as a support worker:
employee, came out as lesbian in 1999. When CH learned of
her sexual orientation, it offered her counselling “to restore her [T]here is no evidence that anyone, including the
to a state of compliance” with the organization’s code. Heintz Christian Horizons leadership, ever considered
eventually went on stress leave, and then filed a human rights whether the prohibition on same sex relationships
complaint alleging that she had been subjected to harassment was necessary for the effective performance of the
and a poisoned work environment because of her sexual orien- job of support worker in a home where there is no
tation. CH admitted it had discriminated against Heintz, but proselytizing and where residents are not required
argued that it was permitted to do so under section 24(1)(a) to be Evangelical Christians.
of the Ontario Human Rights Code, the special interest organ-
Since CH could not rely on section 24(1)(a) of the code, it
ization exemption.
was found to have violated the code. It was ordered to pay
Heintz $23,000 in damages and to develop a new anti-discrim-
Issue: Can CH rely on the defence to discrimination provided
ination policy.
for religious organizations in section 24(1)(a) of the code?

Can a Kosher Certification Organization Terminate an Employee for Dating a Non-Jewish
Woman?
It was Sunday morning and Shimon Lipovenko was on his way the employer invokes religious exemptions are rare, and this
to work when the rabbi phoned and asked to meet at a com- one is even more intriguing because it pits one religious inter-
munity centre. At the meeting, the cleric wanted to know pretation against another.
whether the Toronto man was living with a non-Jewish woman. The employer, Kashruth Council of Canada, also known by
When he said yes, he was fired. the acronym COR, is a non-profit agency that issues kosher
Mr. Lipovenko was a mashgiach, a supervisor who certifies certifications. It says it had to fire Mr. Lipovenko, otherwise it
that food served at banquet halls, hotels or wedding venues would have to accept behaviour that violates its religious
follows Jewish dietary rules. … His dismissal raises unusual, norms. Mr. Lipovenko failed to follow the Halacha, the Jewish
compelling legal questions, experts say. They say cases where laws which not only dictate dietary rules and prayer practices

but also prohibit sexual relationships outside marriage or with a teacher practise a faith, Daniel Lublin, a Toronto employment
gentiles, COR says … lawyer, said in an interview. “What makes this case more special
Mr. Lipovenko had worked for COR for six years. By his ac- is not the employee’s religious adherence but that the relation-
count, he was to supervise a Sunday event on June 3, 2018, ship he is in calls his qualifications into question.”
when he received a call from Rabbi Tsvi Heber, COR’s director David Doorey, a professor of employment law at York Uni-
of community kosher. They met at the Lipa Green Centre and versity, said the case puts competing religious beliefs before
the rabbi asked whether Mr. Lipovenko was living with a the HRTO. “An interesting twist here is that the employee has
woman who wasn’t Jewish. He replied that his girlfriend was a different interpretation of the religious doctrine than does
in the process of converting to Judaism. the employer. He believes that he is in compliance with Jewish
“I asked him if I should go to the event I was scheduled to law and that who he dates does not disqualify him,” Dr. Doorey
do that afternoon, he said no, that I was not going to do any said.
more events for the company as long as I am dating and seeing He said that courts have ruled it isn’t their role to be arbiters
the non-Jewish girl,” Mr. Lipovenko wrote in his complaint. He of religious doctrine, and that people have the right to sincerely
said that he didn’t just suffer financially from his dismissal, but held beliefs, irrespective of religious dogma. So the onus is on
also experienced “hurt feelings, emotional stress and anxiety COR to convince the tribunal that its rules are reasonable, Dr.
which [have] disrupted my life.” Doorey said.
He is asking for $30,000, an apology, a letter of reference The HRTO has scheduled a mediation session for Sept. 19,
for future job applications and also that COR be monitored for 2019. If that does not work, the case would go to a formal
five years to prevent similar incidents. COR is invoking Section hearing.
24(1) of Ontario’s Human Rights Code, which allows exemp-
tions for religious purposes, provided they are reasonable and Source: Tu Thanh Ha, “How a Kosher Supervisor Was Dismissed for Living
genuine qualifications. with a Non-Jewish Woman,” Globe and Mail (July 2019), online: <https://
Section 24(1) is infrequently applied and usually in educa- www.theglobeandmail.com/canada/article-how-a-kosher-supervisor-was-
tion cases, for example when a religious school requires that dismissed-for-living-with-a-non-jewish>.
IV. Other Defences to Prima Facie Discrimination

A variety of other defences applicable to specific situations are provided for in Canadian human
rights statutes. Below is a quick description of these defences.
A. The Nepotism Defence

When I was a high school student, my mom got me a summer job at Eaton’s, a now defunct
national department store. The job paid minimum wage, and I had to cut my hair to work there,
but it was a job. A lot of people would have taken that job, but I got it because my mom was a
long-time employee and Eaton’s, like many employers, gave the children of existing employees
preferential hiring status. I got the job because of my “family status,” and many candidates not
related to existing Eaton’s employees did not get jobs at the store because of their family status—
they lacked the family connection to get in the door.
We learned in Chapter 22 that human rights statutes in Canada prohibit employment dis-
crimination based on “family status.” Therefore, Eaton’s was discriminating based on a prohibited
ground by giving hiring priority to the children of existing employees instead of holding fully
open job competitions. If the store’s hiring policy would have been challenged in a human rights
complaint by a disgruntled candidate without family ties, Eaton’s would have lost, unless it could
point to a statutory defence. That defence is commonly referred to as the nepotism defence.
In the Ontario Human Rights Code, that defence appears in section 24(1)(d), which states
that it is not employment discrimination if “an employer grants or withholds employment or
advancement in employment to a person who is the spouse, child or parent of the employer or an
nepotism defence: A provision found in some human rights statutes that permits an employer to discriminate against workers
on the basis of family status or marital status.

employee.” This section provides a defence to cases of prima facie discrimination on the basis of
“family status” and “marital status,” where an employer makes a decision related to the spouse,
child, or parent of an existing employee.29 For example, in Nevo v. York University, a complaint
that the university denied employment to the spouse of an existing professor was dismissed
because the nepotism defence provided the university with “a complete defence.”30
Nepotism defences exist in several other jurisdictions as well. In the Saskatchewan Human
Rights Code, the nepotism defence applies to the parent, child, or spouse of an existing employee,
just like the Ontario code, but includes an additional requirement that the employer demon-
strate that the discrimination was for a “reasonable and bona fide cause.”31 In the Yukon Human
Rights Act, it is not discrimination for “individuals to give preference to members of their fam-
ily.”32 However, most jurisdictions do not include an expressed nepotism defence. Therefore, an
employer found to have made a decision that is prima facie discriminatory based on family or
marital status would need to defend its actions under the BFOR defence instead.33 In a Quebec
case involving the province’s Charter of Human Rights and Freedoms, which does not contain a
nepotism defence, an employer was found to have discriminated on the basis of “civil status”
when it denied employment as a lifeguard to the daughter of an existing employee pursuant to
its anti-nepotism policy. That discrimination was not a BFOR, since it was not “reasonably ne-
cessary” to discriminate in the choice of a lifeguard in order to promote the purpose of avoiding
conflicts of interest.34
B. The Personal Care Attendant Defence, Homeworker Defence, and

Domestic Worker Defence
Some jobs involve such intimate relationships that the government has elected to exclude them
from human rights laws entirely. For example, in Saskatchewan, Nova Scotia, and Manitoba,
employees “employed in a private home” or “living in the home of the employer” are exempt
from coverage under the human rights legislation.35 The Ontario Human Rights Code allows
discrimination on prohibited grounds against any employee whose “primary duty” is “attending
to the medical or personal needs of the person [the employer] or of an ill child or aged, infirm
or ill spouse or other relative of the person [the employer].”36 These exclusions tend to provide
an absolute defence to complaints that the decision to hire a particular personal care attendant
or domestic worker is discriminatory.
C. The Bona Fide Pension or Insurance Plan Defence

Many pension and insurance plans have provisions that are discriminatory on prohibited
grounds, especially age. For example, the economic model of pension plans and the premiums
required to fund them are based on an assumption that people cease to be employees at a par-
ticular age. Life insurance plans distinguish eligibility based on age (and sometimes marital
status, sex, or disability). Canadian governments have created narrow exceptions to the dis-
crimination that arises from the application of such plans, as long as the plans are bona fide.37
That means that such plans must have been adopted in good faith and the discriminating provi-
sions are reasonably necessary to the sustainability of the plans.38
D. The Special Program Defence

Finally, some human rights statutes (Ontario, British Columbia, and Nova Scotia) include provi-
sions that allow employers to grant special employment privileges, including hiring preferences,
to traditionally disadvantaged groups of people as part of an affirmative action program
designed to alleviate hardship.39 For example, an employer could announce that it will give hir-
ing preference to Indigenous applicants as part of a program to improve economic opportunities
to a historically disadvantaged group.40

V. Chapter Summary

This chapter focused on the range of defences available in Canadian human rights statutes once
a finding of prima facie discrimination on a prohibited ground has been established. An em-
ployer at the receiving end of a discrimination complaint can fit its behaviour into one of the
available defences to avoid being found in violation of human rights legislation. By far, the most
common defence relied upon by employers is the BFOR defence, which balances a worker’s
interest in working without discrimination with the employer’s legitimate business and effi-
ciency interests. A central feature of the BFOR defence is the employer’s duty to accommodate
up to the point of undue hardship. As discussed in this chapter, that duty imposes a proactive
obligation on employers, employees, and unions to canvass the workplace to identify job oppor-
tunities that will enable the employee who is subject to the discrimination to work. We also
considered several other defences that apply to narrower circumstances.

1. Describe the three-step test developed by the Supreme Court of Canada in the Meiorin
decision. At what step did the employer fail in that case, and why?
2. Describe the nature of the obligation on unions and the employee seeking accommodation
in the duty to accommodate process.
3. Why was the random drug- and alcohol-testing policy in Entrop v. Imperial Oil Limited
found not to meet the test for a BFOR?
4. Describe the key factors that are considered in assessing whether accommodation would
impose “undue hardship.”
5. Describe the four-step process that should be applied when assessing whether accommo-
dation of an employee’s disability is possible.
APPLYING THE LAW

1. Which defence(s) would you advise an employer to g. A prison for women has a policy of hiring only fe-
rely on in the following cases of prima facie discrimina- male prison guards.
tion? Assume that all of the defences discussed in this h. A bar hires only tall, skinny, blond female servers.
chapter are available in the human rights statute. 2. An accountant’s office in Toronto has a policy of not
a. The employer refuses employment to a person in a hiring family members of existing employees. The
wheelchair because the job requires employees to rationale for the policy is that family members may
be able to stand for long periods of time. have greater loyalty to family than to the employer,
b. A Jewish high school gives hiring preference to and since theft of money is a major concern for the
Jewish teachers. employer, the policy is for security reasons. Sam is de-
c. A department store employer fires an employee nied a job by the employer because his father works
who, for religious reasons, cannot work on Satur- for the employer, and he files a human rights com-
days, the busiest day of the week. plaint. Applying the two-step human rights model, dis-
d. A university refuses employment to a professor cuss whether Sam’s complaint is likely to succeed.
who has a vocal disability that prevents her from 3. A restaurant introduces a new rule prohibiting employ-
lecturing in large lecture halls. ees who interact with customers from wearing hats at
e. An employee is fired when he reaches age 65 be- work, explaining that customers have complained that
cause the employer’s pension plan includes a man- hats look unprofessional in a restaurant setting. Tom
datory retirement clause. wears baseball caps all the time and he is pissed off. Ari
f. An organization that provides services and counsel- is Jewish and wears a kippah. Both employees are serv-
ling to abused women has a policy of hiring only ers, and they inform the employer that they have a
women. right to keep wearing their hats. When the employer

insists that the head gear be removed, both employees now that Mark is older than 50. If Mark has a seizure
file a human rights complaint. Discuss whether those while operating the crane, serious harm could come to
complaints will succeed in your opinion. Mark and people on the ground below the crane.
4. Mark is a heavy crane operator. He works alone high Therefore, the employer terminates Mark’s employ-
up in the crane during the construction of high-rise ment, arguing that he is incapable of performing the
buildings, lifting heavy materials many stories up the job for safety reasons. Mark files a human rights com-
building. He is also an epileptic. Although he has not plaint. Discuss whether you think Mark’s complaint
had a seizure for several years, the employer learns would succeed.
that the risk of Mark having a seizure has increased

1. See M. Crane, “Human Rights, Bona Fide Occupational 13. For a review of the history of the application of the duty to
Requirements and the Duty to Accommodate: Semantics accommodate to indirect and direct discrimination
or Substance?” (1996) 4 CLELJ 209. In the United States, leading up to the Meiorin decision, see D. Doorey, The Law
this defence is known as a “bona fide occupational qualifi- of Work: Complete Edition (Toronto, ON: Emond, 2016) at
cation,” or BFOQ. 371-72.
2. Human Rights Code, RSBC 1996, c. 210, s. 13(4). 14. LaBranche v. Treasury Board (Department of Foreign
3. British Columbia (Public Service Employee Relations Com- Affairs and International Trade), 2010 PSLRB 65 (employer
mission) v. BCGSEU, [1999] 3 SCR 3 (Meiorin decision) at must address complaints by co-workers and educate them
para 68. on the need for accommodation).
4. Central Okanagan School District No. 23 v. Renaud, [1992] 15. Gahagan v. James Campbell Inc. 2014 HRTO 14; Yeats v.
2 SCR 970 (Renaud). Commissionaires Great Lakes, 2010 HRTO 906; Ottawa-
Carleton District School Board v. Ontario Secondary School
5. Central Alberta Dairy Pool v. Alberta (Human Rights Com-
Teachers’ Federation District 25 Plant Support Staff Unit,
mission), [1990] 2 SCR 489.
2007 CanLII 9755 (Ont. LA); Van Leening v. College of
6. Council of Canadians with Disabilities v. VIA Rail Canada Physical Therapists of British Columbia, 2006 BCHRT
Inc., 2007 SCC 15. 357; Canpar v. USWA, Local 1976 (2000), 93 LAC (4th)
7. See the remarks of Madame Justice Wilson in Central 208; Blumenstiel v. City of Vancouver and Another, 2013
Alberta Dairy Pool v. Alberta (Human Rights Commission), BCHRT 237; and Al-Saidi v. Brio Beverages Inc., 2001
supra note 5, regarding the Supreme Court’s reappraisal of AHRC 5.
its earlier decision in CN v. Canada (Canadian Human 16. A union that fails to assertively represent a member who
Rights Commission) [1987] 1 SCR 1114. See also Pannu v. had raised a legitimate accommodation claim can also
Skeena Cellulose Inc., [2000] BCHRTD No. 56. run afoul of the duty of fair representation, which is a
8. Commission scolaire régionale de Chambly v. Bergevin, legal obligation owed by unions to their members to
[1994] 2 SCR 525 at 546. represent them fairly and without discrimination, which
9. Renaud, supra note 4. See also Meiorin decision, supra we will discuss in Part IV; see Bingley (Re), [2004] CIRBD
note 3. No. 32.
10. Council of Canadians with Disabilities v. VIA Rail Canada 17. Hydro-Québec v. Syndicat des employé-e-s de techniques
Inc., supra note 6. See also Newfoundland (Treasury Board) professionnelles et de bureau d’Hydro-Québec, section locale
v. NAPE, 2004 SCC 66; and Re Zettel Manufacturing Ltd. 2000 (SCFP-FTQ), 2008 SCC 43 (the duty to accommodate
(2005), 140 LAC (4th) 377 (Reilly). includes a duty to reorganize an employee’s duties unless
that will cause undue hardship); Vanegas v. Liverton Hotels
11. British Columbia (Superintendent of Motor Vehicles) v. International Inc., 2011 HRTO 715; Ottawa-Carleton Dis-
British Columbia (Council of Human Rights), [1999] 3 SCR trict School Board and OSSTF (Re) (2005), 141 LAC (4th)
868; Canadian Union of Public Employees, Local 4848 v. 41 (Bendel); and Mohawk Council of Akwesasne and Akwe-
Ambulance New Brunswick Inc., 2012 CanLII 97787 sahsne Police Assn. (Re) (2003), 122 LAC (4th) 161
(NBLA). (Chapman).
12. Renaud, supra note 4.

18. Roberts v. Slocan Forest Products, 2005 BCHRT 206; Kelly 28. See Caldwell v. Stuart, supra note 27 (the dismissal of a
v. Saputo Dairy Products Canada, 2017 BCHRT 225; and teacher from a Roman Catholic school for violating a
Ottawa-Carleton District School Board v. Ontario Second- Catholic doctrine was upheld, since conformity to reli-
ary School Teachers’ Federation District 25 Plant Support gious doctrine was a BFOR); Bonnie Gore v. Ottawa Sep-
Staff Unit, supra note 15 (an exception to this rule is that arate School Board (December 7, 1971, Ont. Bd Inq,
an employer can be required to create a temporary unreported) (the dismissal of a secretary from a religious
“work-hardening” position). organization for non-conformity with religious doctrine
19. Briffa v. Costco Wholesale Canada Ltd., 2012 HRTO 1970; was discriminatory because conformity was not a BFOR).
and Re Perron and Revera Long Term Care Inc. o/a Sumac 29. See the discussion in B. v. Ontario (Human Rights Com-
Lodge, 2014 HRTO 766. mission), 2002 SCC 66 at para 41.
20. Carter v. Chrysler Canada, 2014 HRTO 845; Sacco v. TRW 30. Nevo v. York University, 2013 HRTO 1146.
Canada Ltd., 2013 HRTO 1068; and Sodexo Canada Ltd. v. 31. Saskatchewan Human Rights Code, SS 1979, c. S-24.1,
Canadian Union of Public Employees, Local 145, 2019 s. 16(11).
CanLII 72771 (Ont. LA).
32. Human Rights Act, RSY 2002, c. 116, s. 11(2).
21. Hydro-Quebec v. Syndicat des employé-e-s de techniques
33. See, for example, Cashin v. Canadian Broadcasting Corp.,
professionnelles et de bureau d’Hydro-Québec, section locale
1987 CanLII 92 (CHRT).
2000 (SCFP-FTQ), supra note 17; O-I Canada Corp. v.
USWA, Loc. 2805 (N.A.), [2005] OLAA No. 170 (Levin- 34. Brossard (Town) v. Quebec (Commission des droits de la
son); City of Toronto v. CUPE, Local 416 (Tucker Griev- personne), supra note 27.
ance), [2014] OLAA (Barrett); Barboutis v. Singer Valve, 35. Saskatchewan Human Rights Code, supra note 31, s. 16(8).
2012 BCHRT 244; Alberta (Department of Energy) v. AUPE See also Manitoba’s Human Rights Code, CCSM c. H175,
(Worden Grievance), [2004] AGAA No. 31 (Smith); ss. 14(8), 14(9), and Nova Scotia’s Human Rights Act, RSNS
Thorson v. Northwest Territories, 2013 CanLII 82655 1989, c. 214, s. 6(c)(i).
(NTHRAP); and Saunders v. Syncrude Canada Ltd., 2013 36. Ontario Human Rights Code, RSO 1990, c. H.19, s.
AHRC 11. 24(1)(c).
22. Lane v. ADGA Group Consultants Inc., 2007 HRTO 34; 37. See, for example, Ontario’s Human Rights Code, ibid., s. 25;
Cape Breton (Regional Municipality) v. Canadian Union of British Columbia’s Human Rights Code, supra note 2, s.
Public Employees, Local 933, 2014 NSSC 97; and Chen v. La 13(3); Alberta Human Rights Act, RSA 2000, c. A-25.5, s.
Brass Foods, 2019 BCHRT 111. 7(2); and Canadian Human Rights Act, RSC 1985, c. H-6,
23. Regional Municipality of Waterloo (Sunnyside Home) v. ss. 15(1)(d) and (e).
Ontario Nurses’ Association, 2019 CanLII 433 (Ont. LA). 38. See the discussion in New Brunswick (Human Rights Com-
24. Ont. Human Rights Comm. v. Simpsons-Sears, [1985] 2 mission) v. Potash Corporation of Saskatchewan Inc., 2008
SCR 536; Qureshi v. G4S Security Services, 2009 HRTO SCC 45; Tri-County Regional School Board v. Nova Scotia
409; Markovic v. Autocom Manufacturing Ltd., 2008 HRTO (Human Rights Board of Inquiry), 2015 NSCA 2; Jones obo
64 (a menu of options to make up a lost day were accept- Others v. Coast Mountain Bus Company and Others, 2014
able); and Commission scolaire régionale de Chambly v. BCHRT 166; International Brotherhood of Electrical
Bergevin, supra note 8 (employer required to grant Workers, Local No. 1007 v. Epcor Utilities Inc., 2017 ABCA
employees a paid day off for Yom Kippur). 314; Ostofi v. Hamilton Police Services Board, 2012 HRTO
25. Jaques v. 1633092 Ontario Ltd. o/a TOSH Steakhouse and 2290; and Repaye v. Flex-N-Gate Canada, 2012 HRTO
Bar, 2016 HRTO 403; and Peart v. Distinct HealthCare Ser- 1258. See also Duncan v. Retail Wholesale
vices Inc., 2013 HRTO 305. See also Richards v. 905950 Union Pension Plan, 2017 BCSC 2375 (considering
Ontario Ltd. o/a Storybook Childcare Centre, 2015 HRTO whether differential treatment of married and single
517; Sutton v. Best Western Tower Inn (No. 2), 2010 employees in a pension plan is “bona fide”).
BCHRT 314; and Williams v. Hudson’s Bay Co./Zellers Inc., 39. See, for example, Ontario’s Human Rights Code, supra note
[2009] OHRTD No. 2129; and City of Ottawa v. Ottawa- 36, s. 14; British Columbia’s Human Rights Code, supra
Carleton Public Employees’ Union, Local 503 (Beaulieu note 2, s. 42; and Nova Scotia’s Human Rights Act, supra
Grievance), [2010] OLAA No. 343 (Schmidt). note 35, s. 6(i).
26. Fair Employment Practices Act, SO 1951, c. 24, s. 2(d). 40. Sauve v. Ininew Friendship Centre, 2010 HRTO 720.
27. Brossard (Town) v. Quebec (Commission des droits de la
personne), [1988] 2 SCR 279. See also Caldwell v. Stuart,
[1984] 2 SCR 603.

C H A P T E R 24
Occupational Health and Safety

and Workers’ Compensation*
II. A (Very) Brief History of Injury Compensation and Prevention Laws in
• Explain the workplace safety obligations of employers, workers, Canada 392
and the state. III. Contemporary Injury Prevention Legislation: Occupational Health and
• Describe workers’ right to refuse unsafe work and why few Safety Legislation 393
workers exercise that right. A. The Internal Responsibility System (IRS) 394
• Understand the “arises and occurs test” and how workers’ B. The Employer’s Obligations 394
compensation boards use it to assess whether injuries are C. The Rights and Duties of Workers 394
compensable when the cause of injury is unclear. D. OHS Enforcement and Remedies 397
• Explain how workers’ compensation systems are funded and what IV. The Criminal Liability of Organizations for Workplace Injuries and
rights workers have traded to receive such compensation. Death 398
V. Workers’ Compensation Legislation 399
A. Injury Causation and the No-Fault Principle 399
B. Funding Workers’ Compensation 400
C. Wage-Loss, Rehabilitation, and Survivor Benefits 401
D. The Return to Work 401
VI. Chapter Summary 402
Scenario One: Work Refusal 403
Scenario Two: Arises and Occurs 403
I. Introduction
Two workers died and 20 more were injured when the Babine Forest Products sawmill in Burns
Lake, British Columbia, exploded on January 20, 2012. Ken Mitchell, 57, was badly burned and
is now confined to a wheelchair. “I had stopped my machine and was walking away when there
was an orange flame and explosions: boom, boom. … [T]he blast melted my face. I was tossed
around like a ragdoll. With the pressure from the flames I got sucked up 15, 20 feet.”1 The explo-
sion was caused by the ignition of dust-laden air—a well-known workplace hazard in sawmills
that the employer knew about but failed to remediate.2 A second mill (owned by Lakeland Forest
Products) exploded due to dust buildup—killing two workers and injuring 22 more—only two
* This chapter was authored by Bob Barnetson, Athabasca University.
391

months later in nearby Prince George. Babine Forest Products was fined over $1 million by the
province, while Lakeland Forest Products was fined over $740,000.
While workplace fatalities are relatively rare in Canada, injuries are endemic. In 2017, there
were 251,625 accepted workers’ compensation claims for workplace injuries and 951 claims for
workplace fatalities.3 These numbers dramatically underestimate the true level of workplace
injury by excluding injuries that did not require time away from work, injuries to those outside
the workers’ compensation system, and unreported injuries.4 For example, in 2018, researchers
estimated the true number of workplace fatalities in Canada to be 10 to 13 times the number of
fatalities accepted by workers’ compensation boards. That same year, an analysis of injury
reporting in Alberta found that 69.1 percent of serious occupational injuries were not reported
to the workers’ compensation board.5 Over the past century, pressure applied by workers,
unions, and other activists encouraged politicians to intervene through legislation designed to
prevent workplace injuries and to compensate the victims of such injuries. This chapter consid-
ers those legislative interventions.
II. A (Very) Brief History of Injury Compensation and Prevention

Laws in Canada
Prior to the enactment of workers’ compensation legislation, workers who were injured while
performing their jobs had only the common law regime to seek recourse. They could sue their
employer in court for compensation by alleging either a tort such as negligence or nuisance (see
Chapter 16), or a breach of the implied contractual obligation imposed on employers to main-
tain a reasonably safe workplace (Chapter 9).6 In the tort cases, injured workers seeking com-
pensation had to demonstrate that their employer had failed to exercise due care—the standard
of care that would be exercised by a reasonable person in the circumstances.7 Even when
employers were found to have failed to exercise due care, they could still put forward three
defences to escape liability.
First, if it could be shown that the injured worker failed to exercise reasonable care, and
thereby contributed to the injury (referred to as contributory negligence), the employer was
not liable. Second, if a co-worker contributed to the injury, the co-worker was deemed liable
under the “doctrine of common employment.” Finally, workers were assumed to accept the risks
of work (riskier jobs entailed higher wages) and thus voluntarily assumed responsibility for any
injuries (this defence is known by its Latin name, volenti non fit injuria).8 Together, these three
defences to lawsuits arising from workplace injuries or deaths became known in the legal com-
munity as the “unholy trinity” and together created a substantial barrier for employees seeking
to recover damages for injuries occurring at work. Those workers who successfully navigated
this “unholy trinity” of defences (perhaps 15 percent of all cases) could still be denied compen-
sation if their employer declared bankruptcy.9
The outcome of this system was a transfer of production costs from employer to injured
workers, their families, charities, and, in rare cases, government. The resulting social instability
led the Ontario government to establish a Royal Commission on Workers’ Compensation
headed by Sir William Meredith.10 The 1913 Meredith Report led the Ontario government to
establish Canada’s first Workmen’s Compensation Act the following year; this act’s model was
broadly adopted by all other provinces. Under this model, workers traded their right to sue their
employer in the courts in exchange for immediate, predictable, and stable compensation paid
for by employers and administered by an expert administrative tribunal known (then) as a
Workmen’s Compensation Board (WCB).
due care: The conduct a reasonable person would exercise in a situation to protect the health and safety of another.
contributory negligence: Negligence of an injured party that contributes to the loss suffered or damage incurred due to
the negligence of another party.

Chapter 24 Occupational Health and Safety and Workers’ Compensation 393
While most workers have had access to compensation for workplace injuries for the last 100
years, governments took little action to prevent the occurrence of workplace injuries until work-
ers began demanding safety in their workplaces in the 1960s. An 18-day strike by uranium
miners in Elliot Lake, Ontario, in 1974, fuelled by decades-old concerns about work-related lung
cancer and silicosis, increased political pressure on governments to take steps in this direction.11
During the 1970s, occupational health and safety legislation was enacted across the country that
established the jurisdiction’s regulatory agency, created an obligation on employers to control
workplace hazards, and increased worker rights and involvement in safety.

Who Is Covered by Safety and Injury Legislation?
Workers’ compensation and occupational health and safety outside the ambit of legislation that applies only to “employ-
laws apply to “workers” rather than “employees,” which in prac- ees.”† Conversely, in some industries, employees may be ex-
tice usually means that these statutes apply to a greater pro- empt from mandatory workers’ compensation (and thus are
portion of the workforce than do laws that apply only to not “workers” for the purposes of workers’ compensation). For
“employees.” Recall, for example, the story of Samir the taxi example, most employers in Saskatchewan, Prince Edward Is-
driver that opened Chapter 4. Samir was injured while on the land, and Nova Scotia are not required to have workers’ com-
job and claimed workers’ compensation benefits. Even though pensation coverage for paid farm workers, although farm
he owned his own taxi, fixed his own hours of work, paid all of employers can purchase voluntary coverage for their workers.
his own car-related expenses, was an independent contractor The complexity of the rules in Canada about the scope of
for the purposes of his taxes, and had the right to hire workers coverage of workers’ compensation and occupational health
to drive his cab, Samir was still considered a “worker” employed and safety legislation makes it a good idea to investigate the
by Blue Line Taxi for the purposes of workers’ compensation rules in your jurisdiction if you have any question about
legislation.* whether the legislation applies to a particular worker.
Each jurisdiction has industry-specific rules. In Ontario’s
construction industry, for example, a “worker” can be an in- * See Decision No. 934/98, 2000 ONWSIAT 3346.
dependent contractor, a sole proprietor, a partner in a partner- † Workplace Safety and Insurance Act, SO 1997, c. 16, Sched. A, s. 12.
ship, or an executive officer—types of workers that clearly fall
III. Contemporary Injury Prevention Legislation: Occupational

Health and Safety Legislation
All provinces and territories (as well as the federal government) have enacted occupational
health and safety (OHS) legislation designed to prevent workplace injuries. These laws are
supplemented by extensive regulations. Although there are jurisdictional differences, the basic
requirements of OHS legislation are similar across Canada, as depicted in Box 24.2 and
explained below.

The Basic Elements of the Canadian Occupational Health and Safety Model
Although there is some variation across Canadian jurisdictions, identifying and controlling hazards, training workers
the basic elements of the internal responsibility legal model and managers, and providing safety equipment.
can be summarized as follows: • Workers are required to comply with the legislation
and employer safety directions and report workplace
• Employers are required to take every reasonable hazards.
precaution to ensure that a workplace is safe, including

• OHS legislation creates legal rights to ensure workers • A “right to know” about workplace hazards.
are able to participate in the pursuit of a safe work- • A “right to refuse unsafe work.”
place, including: • The agency responsible for administering OHS legisla-
• A “right to participate” through a joint health and tion must inspect workplaces, disseminate information,
safety committee. and enforce the legislation.
A. The Internal Responsibility System (IRS)

The distribution of responsibilities in the legislation to employers and workers is known as the
internal responsibility system (IRS). It is based on the assumption that, since both employers
and workers have a stake in preventing workplace injuries, they should work together to address
workplace hazards.12
B. The Employer’s Obligations

OHS legislation imposes a legal obligation on employers to take all reasonable precautions to
protect worker health and safety. The legislation does not require employers to make workplaces
completely risk free—sometimes accidents happen and there is nothing the employer could
have done to prevent it. An employer can defend a charge that it violated OHS by demonstrating
that it took all reasonable precautions in the circumstances to make the workplace safe. This is
sometimes known as a due diligence defence.
Employers are obligated to control and limit hazards in the workplace. This obligation can be
met by modifying work processes, equipment, and materials to reduce exposure to hazards.
These sorts of solutions are called “engineering controls.” Employers can also use “administra-
tive controls” (such as training, shift rotations, and medical surveillance) to reduce the risk of
injury. Finally, employers can issue workers “personal protective equipment” (PPE), such as
steel-toed boots, goggles, and respirators to protect workers from specific injuries. Engineering
controls are the most effective but also the most expensive way to reduce the risk of injury in the
workplace, while PPE is the least costly and least effective.
In Ontario, since 2010, the OHS legislation has also imposed specific detailed obligations on
employers respecting workplace violence and harassment.13 Employers with greater than four
workers are required to prepare and post workplace violence and harassment policies that must
be reviewed annually. The policies must describe measures for controlling risks of violence and
describe processes for receiving and processing complaints from employees. In addition,
employers must conduct risk assessments and act proactively to protect workers if there is any
reason to believe that a worker is under threat of harm at work due to domestic violence.
C. The Rights and Duties of Workers

The law provides several mechanisms to empower and equip workers in the pursuit of safer
workplaces, including the right to participate in OHS activities (most commonly through joint
health and safety committees), the right to know about workplace hazards, and the right to
refuse unsafe work.
internal responsibility system (IRS): A system of shared responsibility between employers and workers for workplace
health and safety.
due diligence defence: A defence sometimes available to a party accused of violating a statute (such as occupational health
and safety legislation) that requires demonstrating the party took all reasonable precautions in the circumstances to avoid the
harm or wrong that occurred.
joint health and safety committee (JHSC): A committee comprising employer and worker representatives mandated
by occupational health and safety legislation to consult, investigate, and make recommendations relating to health and safety
issues in a workplace.

1. The Right to Participate and Joint Health and Safety Committees
Workers’ right to participate in OHS activities is exercised most often through joint health and
safety committees (JHSCs). Canadian OHS legislation requires that a JHSC be created compris-
ing representatives of both the employer and the workers. The specific details of when a JHSC
is required and what duties they are mandated to perform vary slightly across jurisdictions. For
example, the Ontario Occupational Health and Safety Act requires that a JHSC be created at any
workplace where “20 or more workers are regularly employed” or where there are less than 20
workers but designated dangerous substances are present. The size of the JHSC depends on the
size of the workplace, but at least half the members must be workers at the workplace who are
not managers. Worker representatives are selected by the workers. OHS legislation grants vari-
ous powers to JHSCs, including the power to investigate risks, obtain information regarding
hazards, make recommendations to the employer, and investigate unsafe work refusals.14
Where an employer refuses to control hazards, the state may intervene through inspections
or in response to OHS complaints filed by workers or unions. Worker participation in OHS
tends to be more effective in larger workplaces and in the presence of trade unions.15 JHSCs are
often criticized as lacking the authority to compel employers to act on safety issues. Recent
research suggests that worker representatives who gather their own research on hazards, empha-
size workers’ safety knowledge, and mobilize workers around safety issues are more likely to
realize significant improvements in workplace safety.16
2. Workers’ Right to Know About Workplace Hazards

Workers have a right to know about hazards in their workplace. This right requires employers
to identify and disclose potential sources of injury or harm. This obligation reflects the informa-
tion asymmetry between employers and workers that allowed employers’ historic pattern of
hiding workplace hazards to reduce liability. In order to address the “hidden” hazards posed by
chemical exposures, the federal government created the Workplace Hazardous Materials In-
formation System (WHMIS). The WHMIS allows each jurisdiction to require employers to
ensure that hazardous substances are used, stored, handled, and disposed of properly. Employ-
ers must also ensure that hazardous substances are properly labelled, material safety data sheets
(MSDSs) are available, and workers receive proper training about risk prevention. If you have a
job, there is a good chance that MSDSs are posted somewhere in your workplace.
Each jurisdiction has established occupational exposure limits (OELs) for hazardous sub-
stances that are supposed to identify the level of exposure at which it is believed that nearly all
workers may be exposed without adverse effect. Over time, these “safe” levels of exposure have
gone down, often dramatically. This suggests a systemic bias toward unsafe exposure levels. These
unsafe OELs reflect that 90 percent of OELs are based on insufficient data on the long-term effects
of exposure from either animal or human studies.17 Further, OELs have been set for only about
700 chemical substances—a fraction of the over 70,000 substances found in modern workplaces.
3. Workers’ Right to Refuse Unsafe Work

Despite the various safeguards in OHS legislation that are supposed to ensure safer workplaces,
the large number of annual work-related injuries suggest workers continue to face uncontrolled
right to participate: Under the IRS, workers have a right to be a part of the process of identifying and resolving health and
safety issues. This right is often exercised through joint health and safety committees.
right to know: Under the IRS, workers have a right to know about the hazards they are exposed to in the workplace.
Workplace Hazardous Materials Information System (WHMIS): An information system and database that provides
workers and employers with information about hazardous materials found in workplaces.
occupational exposure limits (OELs): The concentration of a hazardous material that a worker may normally be exposed
to without causing harm.

hazards in the workplace. For this reason, workers have also been granted the right to refuse
unsafe work. The right to refuse unsafe work is one of the few instances when an employee’s
common law obligation to obey an employer’s direction is partly suspended—it creates a statu-
tory exception to a charge by the employer of insubordination. A work refusal by a worker trig-
gers an internal workplace investigation first, and if the worker remains unsatisfied with the
result of that investigation, a government OHS inspector comes to the workplace and conducts
an investigation. The decision in Box 24.3 considers the right of a teacher to refuse work when
faced with a violent student.

The Right to Refuse Unsafe Work
Toronto Elementary Catholic Teachers v. Toronto Catholic that created special rules for teachers. The OHSA allows a right
District School Board to refuse work when the worker has “reason to believe” that
2017 CanLII 37597 (Ont. LRB) the physical condition of the workplace or workplace violence
“is likely to endanger” them.* However, a regulation passed
Key Facts: A kindergarten student engaged in a series of vio- under the OHSA provides that the right to refuse unsafe work
lent acts against other children, a teaching assistant, and the does not apply to a teacher when the circumstances are such
classroom teacher, including punching, biting, kicking, pulling “that the life, health, or safety of a pupil is in imminent
hair, scratching, pushing, and throwing objects at people. On danger.”†
one particularly bad Friday, the student hit another student, The OLRB ruled that when the teacher first refused to work
then kicked and punched the assistant teacher, and then on the Friday, the student’s safety was in “imminent danger”
began to throw toys around the room. While the assistant and therefore the exception in the regulation applied and the
teacher attempted to control the student, the teacher re- teacher had no right to refuse work. The student was in an
ported to the office and indicated that she was refusing unsafe exceptionally agitated mood and was in danger of hurting
work. The principal removed the student from the classroom, himself. The fact that there was an assistant teacher still with
and the teacher agreed to return. However, on the next Mon- the student does not change this reality, because a teacher
day morning, the student was back in the classroom, and the cannot delegate their legal obligations to assistants. However,
teacher again refused to teach her class. An OHS inspector the teacher did have the right to refuse work on the Monday.
was called, and after an investigation, the inspector ruled that The student still posed a threat of violence, and the teacher
there was no basis for the teacher to refuse to work on either had good reason to believe she could be harmed, as the stu-
occasion. The teacher, through her union, appealed to the dent had already scratched her eye and hurt others. The stu-
Ontario Labour Relations Board. dent was not in an agitated state on the Monday morning, so
Issue: Did the teacher have a right to refuse unsafe work his safety was not in question. By the time of the decision, the
caused by a violent kindergarten student? student was no longer in the class, so no further remedy was
ordered.
Decision: The OLRB ruled that the teacher did not have a right
to refuse work on the first day but that she did have the right
to refuse on the second day. The decision turned on the word- * Ontario OHSA, RSO 1990, c. O.1, s. 43.
ing of the Occupational Health and Safety Act and a regulation † Ontario OHSA Regulation 857, s. 3
While the right to refuse work sounds like a powerful tool for workers, in reality few workers
exercise this right. OHS statutes prohibit reprisals against workers who exercise the right to
refuse unsafe work, as the case in Box 24.4 describes.18 However, many workers are either not
aware of that protection, do not wish to enter into an adversarial relationship with their em-
ployer, or doubt that the law will protect them. An Alberta study of 2,000 workers found that
right to refuse unsafe work: Under the IRS, workers have a right to refuse to perform work they believe to be unsafe,
pending the outcome of an investigation.

only 33.6 percent of workers exposed to unsafe work refused the work, often due to fear of
(illegal) retaliation by their employer.19 Some workers informally refused unsafe work by alter-
ing the process or pace of work. Other forms of informal refusal include refusing overtime on
unsafe jobs, calling in sick, and seeking transfers.20
It is important to note that the right to refuse unsafe work only allows workers to protect
themselves from those dangers that they know about and believe to be unsafe. It does not confer
any ability on workers to influence whatever hazards exist in the workplace. By contrast,
employers have significant latitude to alter work in ways that make it minimally acceptable to
(although perhaps not perfectly safe for) the worker. As demonstrated in Box 24.4, an employer
can also simply order another worker to perform the work and see if that worker refuses (al-
though in some jurisdictions, such as Ontario, the employer must first advise the other workers
that there has been a refusal by a co-worker). Note that in British Columbia, both workers’
compensation and OHS laws are included in the Workers Compensation Act, and the expert tri-
bunal with authority to enforce the legislation is the Workers’ Compensation Appeals Tribunal
(WCAT), which is the decision maker in the case in Box 24.4.21

Employer Retaliation Against a Worker Who Refuses Unsafe Work
BC WCAT Decision No. A1701552 (Re) Issue: Was the worker dismissed as a reprisal for exercising his
2018 CanLII 75253 (BCWCAT) OHS rights?
Key Facts: The worker was hired as a production worker in Decision: Yes. The British Columbia Workers’ Compensation Ap-
November 2015. On March 4, 2016, the worker’s supervisor peal Tribunal found that the worker had exercised his statutory
directed him to perform work on a roof but failed to provide right to refuse unsafe work and complied with his statutory duty
fall protection. The worker refused the unsafe work. Fifteen to report unsafe work, had experienced a negative employment
minutes later, the worker saw two other workers on the roof consequence, and that there was a causal connection between
performing the refused work without wearing fall protection. the two events. The tribunal also found that the employer failed
The worker then called WorkSafeBC to report the incident. An to rebut the presumption in the Workers Compensation Act that
OHS inspector visited the site on March 7 and issued four or- it took discriminatory action against the worker. The employer’s
ders, including one related to inadequate fall protection. On assertion that the worker was fired for poor performance sat
March 11, the worker was fired by the employer. The worker uncomfortably with the $2 per hour pay raise given to the
subsequently complained that he had been fired for exercising worker on the same day that he refused unsafe work.
his OHS rights, which a government inspector agreed with.
The employer appealed the decision.
D. OHS Enforcement and Remedies

OHS legislation is applied through a mix of proactive government enforcement and individual
complaints. The government agency charged with administering the legislation performs sev-
eral functions, including workplace inspections (which may be random or targeted) to ensure
that the employer has identified and controlled hazards. Complaints can be filed under OHS
legislation, which triggers a government investigation and sometimes a legal hearing before an
expert administrative tribunal. Non-compliance is usually dealt with by ordering the employer
to comply. Where there is a risk of imminent harm, an employer can be ordered to stop work
until the problem is remediated. Some jurisdictions also allow OHS inspectors to issue tickets
or other administrative fines for non-compliance. Any serious injury or fatality will also usually
result in an investigation. Infrequently, a government may also prosecute employers in court

under OHS legislation for non-compliance with the Occupational Health and Safety Act. Most
often, this action is taken when a worker has been seriously injured or killed. If convicted,
employers can face fines or (less commonly) jail time.
IV. The Criminal Liability of Organizations for Workplace Injuries

and Death
Most preventable workplace injuries and fatalities are dealt with within the work law subsystem
(see Chapter 2)—the laws that govern injuries and fatalities in the course of work are labour and
employment laws, such as OHS and workers’ compensation—rather than as criminal law mat-
ters (in the broader legal subsystem, shown in Figure 2.1 in Chapter 2). Far less stigma is attached
to being found in violation of an OHS statute than being convicted of a criminal offence. Can-
ada’s Criminal Code makes some types of deliberate and negligent conduct that causes harm at
a worksite, or anywhere else, a criminal offence. However, in practice, the police have rarely laid
criminal charges when workers are harmed or killed in the course of their work, even when that
harm was clearly preventable had the employer taken certain basic precautions.
In 2004, the federal Parliament amended the Criminal Code to strengthen the corporate
criminal liability provisions in the wake of the 1992 deaths of 26 miners at the Westray Mine in
Pictou County, Nova Scotia.22 In the Westray Mine disaster, evidence disclosed that corporate
officials were aware of the danger that the mine could explode, but still allowed workers to go
into the mine to meet production deadlines. Criminal charges were eventually dropped by the
Crown, which decided that it was not possible to obtain a criminal conviction owing to the dif-
ficulty of attributing fault to a corporation under existing criminal laws. The intent of Criminal
Code reforms was to make it easier to prosecute a corporation or other organization for criminal
conduct when it either deliberately or negligently contributes to the death or injury of people at
a workplace.23
Despite all of the fanfare when the
reforms were introduced, the “Westray
amendments” have only been used a hand-
ful of times to prosecute employers for
workplace fatalities.24 For example, neither
of the companies involved in the mill explo-
sions that we read about at the beginning of
the chapter were criminally prosecuted. In
one highly publicized case, a Toronto con-
struction contractor pleaded guilty to crim-
inal negligence causing death after a swing
(platform) holding six men collapsed, lead-
ing to the death of four of the men after a
14-storey fall on Christmas Eve, 2009. A
senior official of the company was one of the
deceased, and his negligence in failing to
take proper steps to ensure the swing was
safe and that rules were complied with was
attributed to the corporation under the new
legal rules introduced in the Westray
A mourner visits the Westray Miners’ Memorial in Pictou County, Nova Scotia. amendments. The corporation was ordered
The 1992 Westray Mine explosion was one of the deadliest industrial accidents to pay a fine in the amount of $750,000.25
in Canadian history. The reluctance of governments to crim-
Source: Miles Howe (Halifax Media Co-op). inally prosecute individuals for safety

crimes reflects, in part, the widely adopted view that violations of OHS laws are “only” regula-
tory offences—offences that are illegal because they are prohibited by an occupational health
and safety statute—rather than offences that are illegal because they are immoral (e.g., murder,
assault) in their own right.26
V. Workers’ Compensation Legislation

Every province and territory has a workers’ compensation system. The principles that underlie
most Canadian workers’ compensation legislation are those set forth in the 1913 Meredith
Report (see Box 24.5). Legislation compels most employers to pay premiums to a government-
appointed workers’ compensation board (WCB). Those workers who are covered receive stable,
predictable, and immediate benefits administered by the WCB in the event of a workplace in-
jury. In exchange for this insurance program, workers lost the right to sue their employers in
tort or contract for damages sustained as a result of injury.

The Meredith Principles
Contemporary workers’ compensation legislation continues to 3. All employers share the cost of injuries collectively by
operate under the five principles laid down by Sir William paying premiums.
Meredith in his 1913 report for the Royal Commission on Work- 4. The system is administered by an independent govern-
ers’ Compensation:* ment agency.
5. The workers’ compensation board in each jurisdiction is
1. Compensation is paid on a no-fault basis (i.e., how the the only provider of workers’ compensation insurance
injury occurred is irrelevant), and workers forgo the op- and is the final arbiter for all claims.
portunity to sue their employer.
2. An “accident” fund is established to guarantee the * You can read the full text of the Meredith Report here: <http://
availability of benefits over time. www.ontla.on.ca/library/repository/mon/26005/203796s.pdf>.
Many legal disputes arise about whether an injury occurred “in the course of employment.” If
it did not, then the worker is not entitled to workers’ compensation benefits. However, as we noted
in Chapter 16 when we looked at the tort of negligence (see Box 16.4 and the case Rudd v. Hamiota
Feedlot), if an injury suffered by a worker is not covered by workers’ compensation, then the
worker is entitled to sue the employer in court for breach of contract or for committing a tort.27
A. Injury Causation and the No-Fault Principle

Workers’ compensation benefits are available to all workers injured in the course of their
employment regardless of who was at fault for the injury. A pivotal initial question is therefore
whether the injury occurred “in the course of employment.” Workers’ compensation tribunals
apply a two-part arises and occurs test to determine whether an injury was caused by an event
arising out of and occurring during the course of employment. An injury arises out of employ-
ment when it is caused by the nature, conditions, or obligations of employment (i.e., an employ-
ment hazard). An injury occurs in the course of employment when it happens at a time and
place consistent with the obligations and expectations of employment. While time and place are
arises and occurs test: The test used by WCBs to determine whether an injury is compensable. In short, it is used to determine
whether an injury arose from and occurred during the course of work.

not strictly limited to the normal hours of work or the employer’s premises, there must be some
relationship between employment expectations and the time and place of the injury.28
Whether an injury arose and occurred during the course of employment is sometimes easy
to assess. An acute physical injury (e.g., a fracture) resulting from a fall or contact with an object
in the workplace is obviously compensable. However, other cases are not so straightforward, as
demonstrated by the case in Box 24.6. In assessing a claim where the facts are ambiguous, tri-
bunals apply a “balance of probabilities” test (i.e., whether it is more likely than not that the
injury was caused during work). Workers’ compensation legislation also commonly includes
presumptions. For example, certain diseases are so closely linked with certain kinds of work
(e.g., bladder cancer in firefighters, certain lung diseases in coal miners) that such claims are
presumed to be employment related, unless clear evidence of some other cause exists.

Injured on the Job?
Erskine v. British Columbia (Workers’ Compensation Decision: No. The Workers’ Compensation Appeal Tribunal
Appeal Tribunal) concluded that the damage to Erskine’s foot was most likely
2013 BCSC 1583 caused by an injury occurring prior to the January 2008 forklift
mishap:
Key Facts: On January 2, 2008, Erskine’s foot was run over by
a forklift while he was at work. He saw a doctor that day, and The result is that Dr. Kassa’s chart notes suggest that
the doctor’s chart indicated that the worker had developed the worker’s left foot symptoms on January 2, 2008
foot and ankle pain as a result of “pushing a quad” several were related either to his pre-existing spurring,
weeks earlier. In August 2007, Erskine had also undergone an some sort of all-terrain vehicle incident, or perhaps
X-ray of the foot for discomfort related to bone spurs. After the both. Because Dr. Kassa’s records necessarily come
January 2 incident, Erskine developed foot, knee, hip, and from the worker’s own report, it appears likely to me
lower back pain. He left the original employer because of his that the worker himself did not believe he sustained
injury in late 2008 and left employment altogether in early any injuries following the forklift accident.
2009. In April 2009, Erskine filed a workers’ compensation claim
seeking benefits for an injury caused by the January 2 forklift The medical evidence, Erskine’s delay in reporting the in-
incident. cident, and the tribunal’s belief that Erskine was not being
completely truthful about the origins of the injury all contrib-
Issue: Did Erskine’s injury arise out of employment and occur
uted to the tribunal’s conclusion that the injury did not arise
in the course of employment?
out of employment.
Sometimes it can be very challenging to apply the “arises and occurs test.” For example, a
cashier with diabetes may be more susceptible to carpal tunnel syndrome because of her disease
than a cashier without diabetes. Yet, the constant grasping motion required by the work likely
played an important part in the development of the cashier’s carpal tunnel syndrome. In these
cases, WCBs will typically use the “but for” standard: if the injury would not have occurred but
for the work, the injury is deemed to have arisen and occurred. This means that the work does
not have to be the sole, predominant, or major cause of an injury, but it must be a necessary
factor for the occurrence of the injury. The case discussed in Box 24.6 considers whether a
worker’s foot and ankle injuries were actually sustained on the job and eligible for
compensation.
B. Funding Workers’ Compensation

Workers’ compensation systems are funded by employer premiums. Premiums are based on an
employer’s payroll multiplied by the assessment rate set for each industry. The resulting
premiums are designed to ensure that employers in each industry are paying the full cost of all

injuries incurred in that industry in a year. This means that employers in industries with more
injuries or more severe injuries pay higher premiums to offset the higher cost of such injuries.
One drawback of assessing premiums by industry is that individual firms have little incentive
to lower their own injury rates. Any savings that result from safer workplaces are spread across
the entire industry. To counter this effect, some provinces have introduced experience rating
programs. Under these programs, individual employers’ premiums can be increased or
decreased based on the employer’s “accident record” (i.e., the cost of claims by workers of the
employer). Experience rating programs reward employers that have low claim costs and
penalize employers that have high claim costs.
An analysis of experience rating programs suggests that linking claim costs to premium
rebates reduces the number and duration of claims.29 It is, however, unclear whether this out-
come represents a reduction in the number or severity of injuries. This outcome may also be a
reflection of changes in injury reporting, including claims suppression.30 Employers may also
seek to reduce the cost and duration of claims via early return-to-work programs.31 Experience
rating programs may also provide employers with an incentive to dispute claims, thereby intro-
ducing a form of litigation into the notionally no-fault workers’ compensation system.
C. Wage-Loss, Rehabilitation, and Survivor Benefits

Workers’ compensation legislation requires an injured worker and the employer to report in-
juries to the WCB. Injured workers who experience a wage loss because of their injury can
receive financial compensation for this loss. The level of wage-loss benefit provided varies by
jurisdiction and is between 75 and 90 percent of a worker’s net loss. Less-than-full compensa-
tion reflects that workers’ compensation is designed to insure workers against ruinous loss due
to injury, not all loss.32 Further, partial compensation is thought to provide incentive to workers
to return to work duties as soon as possible—reflecting a deep-seated (but unsubstantiated)
belief by some employers and WCBs that workers have a tendency to exaggerate the extent or
duration of their injuries to avoid work.33 Some provinces provide wage-loss benefits starting
the day after the injury occurred, while others have short waiting periods (e.g., three days)
before compensation begins.
Injured workers may also be entitled to receive medical and vocational rehabilitation benefits
from a WCB. Medical benefits cover the costs of treating an injury, including costs that would
otherwise be borne by the taxpayer (through the health care system) or the worker. Vocational
rehabilitation programs are designed to increase the probability of a worker returning to
employment. They can entail assessing an injured worker’s level of ability, modifying a worksite
to accommodate a disability, providing skill development, and (where a worker is no longer
employed) job search assistance. The dependents of workers who die as a result of a compen-
sable injury are eligible to receive fatality benefits, including an allowance for funeral costs and
wage-loss benefits.
D. The Return to Work

Most injured workers will eventually return to work. Yet returning to work is an area of signifi-
cant legal and practical complexity. Important differences exist among jurisdictions. For ex-
ample, Ontario’s Workplace Safety and Insurance Act requires employers to re-employ injured
workers in some circumstances, subject to certain time limits.34 An employer who fails to
comply with this requirement can face a human rights complaint based on disability discrimin-
ation (see Chapter 22), as well as additional costs associated with the WCB extending the
experience rating program: Programs that adjust employer’s workers’ compensation premiums based on the employer’s
claims record. Experience rating programs incentivize employers to improve safety but also create an incentive for them to attempt
to suppress or resist claims, since claims may lead to higher experience rating assessments.

worker’s wage-loss benefits. By contrast, British Columbia has no such requirement. Injured BC
workers whose employers refuse to employ them because of their medical condition must pur-
sue a remedy under the provincial human rights statute. During this (lengthy) process, the
workers able to work are ineligible for wage-replacement benefits.35
Compounding the difficulty workers can experience in returning to work is the fact that
employers across Canada have an economic incentive to minimize the cost of accommodating
workers who face medical restrictions. Accommodating an injured worker’s disability almost
always entails some degree of disruption and additional cost. Because employers prefer to avoid
additional costs (which reduce their profitability), they might promise to accommodate an
injured worker with a disability through modified duties but then not actually do so.36 Workers
facing such a situation must weigh the short-term costs and prospects of a remedy under human
rights legislation against the costs of accepting the unmodified work (which include the risk of
reinjury).
VI. Chapter Summary

This chapter outlined the laws that seek to prevent and compensate workplace injuries. Workers
and employers are expected to work together to identify and control workplace hazards, al-
though employers are ultimately responsible for ensuring the safety of workplaces. The state is
responsible for ensuring that employers control hazards and investigating workplace health and
safety incidents. Despite worker safety laws, hundreds of thousands of Canadians are injured on
the job each year. To compensate injured workers, governments have established provincial and
territorial workers’ compensation systems. Injured workers are normally eligible for a mixture
of wage-loss, medical, and vocational rehabilitation benefits. In exchange for this compensation,
workers have surrendered their right to sue their employer for compensation.

1. What three safety rights do workers have under the internal responsibility system?
2. What is the role of joint health and safety committees in the Canadian occupational health
and safety model?
3. Why might workers be reluctant to exercise their right to refuse unsafe work?
4. What have workers given up and gained under workers’ compensation? Why might work-
ers prefer to receive workers’ compensation instead of seeking redress under the common
law?
5. What test do WCBs use to determine whether an injury is compensable? Using this test,
would a bee sting injury incurred by a worker whose job is outdoors be compensable?

APPLYING THE LAW

1. Go online to the CanLII website (<https://www.canlii to the basement slippery, despite repeated cleanings of the
.org>), find your jurisdiction’s occupational health and non-skid surface.
safety statute, and locate the provisions regarding At the start of Sam’s shift on Tuesday, Sam descends the
workers’ right to refuse unsafe work. The legal rules stairs to fetch additional food, slips on the greasy floor, and
may also be found in a regulation that was passed pur- almost falls down the stairs. Sam approaches the manager and
suant to the OHS statute. If you have difficulty finding indicates that the stairs are unsafe. Sam refuses to descend the
the legislation, try searching “right to refuse unsafe stairs until they are made safe.
work” and your province and see if your government Question: What is Sam’s manager required to do after Sam
has prepared an information website that explains the refuses unsafe work?
legal rules (and perhaps links to the legislation). Sam’s manager sends Sam home for the day without pay
Once you have located the legislation or a summary and immediately directs another employee to fetch the addi-
of it, answer the following questions: tional foodstuffs.
a. When can a worker refuse unsafe work? Question: Has Sam’s manager complied with your jurisdic-
b. What test(s) must be met for work to be considered tion’s legislation? Why or why not?
unsafe? When Sam returns to the workplace the next day, the stairs
c. What must an employer do when a worker refuses remain slippery and unsafe.
unsafe work? Question: What are three ways Sam could handle this situation?
d. If a worker believes the work remains unsafe, what What are the pros and cons of each option?
happens then?
e. What section of your jurisdiction’s legislation pro- Scenario Two: Arises and Occurs
hibits retaliation against workers for exercising their Kelly is employed at the same restaurant as Sam. After Kelly’s
OHS rights? shift is over, Kelly changes from the restaurant uniform into her
2. Apply these provisions to answer the question posed street clothes in the basement changing room. Kelly then as-
in the following two scenarios, which take place in a cends the stairs to exit the building and go home. While climb-
fast-food restaurant. ing the stairs, she slips on the greasy stair risers and falls.
As a result of the fall, Kelly’s wrist is broken. Kelly reports
Scenario One: Work Refusal the injury to the workers’ compensation board. Her manager
Sam is employed as a cook at a fast-food restaurant that has disputes that the injury is compensable. Specifically, the man-
two levels. The ground floor includes the kitchen and eating ager asserts that the injury did not arise and occur in the course
areas. Additional foodstuffs are stored in the basement. The of employment because Kelly’s shift was over and the injury
basement also contains changing rooms, employee wash- occurred when she was on her way home.
rooms, and a small break room. The basement is accessed via Question: Is Kelly’s injury compensable? Why or why not?
a set of stairs in the back of the kitchen. Question: Why might Kelly’s manager resist Kelly’s workers’
Sam is required to descend the stairs multiple times during compensation claim?
each shift to retrieve more frozen French fries and other menu
items that are cooked in the deep fryer or on the grill. The cook-
ing processes make the floor of the kitchen area and stairwell


1. J. Hunter, “Survivors of the Babine Mill Explosion: ‘Our 13. Occupational Health and Safety Act, RSO 1990, c O.1,
Families Will Never Be the Same,’” Globe and Mail (March Part III.01.
2014), online: <http://www.theglobeandmail.com/news/ 14. Ibid., s. 9.
british-columbia/survivors-of-the-babine-mill-explosion
15. T. Nichols & D. Walters, “Worker Representation on
-our-families-will-never-be-the-same/article17362407>.
Health and Safety in the UK—Problems with the Preferred
2. WorkSafeBC, Incident Investigation Report 2012161980018 Model and Beyond” in D.R. Walters & T. Nichols, eds,
(Vancouver: WorkSafeBC, 2012). International Perspectives on Representing Workers’ Interests
3. Association of Workers’ Compensation Boards of Canada, in Health and Safety (Basingstoke, UK: Palgrave Macmil-
National Work Injury, Disease and Fatality Statistics, lan, 2009) 19-30.
2015 – 2017 (Ottawa: AWCBC, 2018). 16. A. Hall, A. Forrest, A. Sears, & N. Carlan, “Making a Dif-
4. R. Cox & K. Lippel, “Falling Through the Legal Cracks: ference: Knowledge Activism and Worker Representation
The Pitfalls of Using Workers’ Compensation Data as Indi- in Joint OHS Committees” (2006) 64:3 Indus Rel 408.
cators of Work-Related Injuries and Illnesses” (2008) 6:2 17. G. Ziem & B. Castleman, “Threshold Limit Values: Histor-
Pol’y & Prac in Health & Safety 9. ical Perspectives and Current Practice” in S. Kroll-Smith,
5. J. Foster, B. Barnetson, & J. Matsunaga-Turnbull, “Fear P. Brown, & V. Gunter, eds, Illness and the Environment
Factory: Retaliation and Rights Claiming in Alberta, (New York: New York University Press, 2000) 120-34.
Canada” (April-June 2018) J of Workplace Rts 1. 18. See, for example, Occupational Health and Safety Act, RSO
6. J. Witt, The Accidental Republic: Crippled Workingmen, 1990, c. O.1, part VI (Reprisals by Employer Prohibited).
Destitute Widows and the Remaking of American Law 19. Foster et al., supra note 5.
(Cambridge, MA: Harvard University Press, 2004); and
E. Tucker, “The Law of Employer’s Liability in Ontario, 20. G. Gray, “A Socio-Legal Ethnography of the Right to Refuse
1861 – 1990: The Search for Theory” (1984) 22 Osgoode Dangerous Work” (2002) 24 Stud in Law, Pol & Soc 133.
Hall LJ 213. 21. Workers Compensation Act, RSBC 1996, c. 492.
7. R. Risk, “This Nuisance of Litigation: The Origins of 22. Bill C-45, An Act to Amend the Criminal Code (Criminal
Workers’ Compensation in Ontario” in D. Flaherty, ed, Liability of Organizations), now codified in the Criminal
Essays in the History of Canadian Law, vol. 2 (Toronto: Code, RSC 1985, c. C-46, ss. 22.1, 22.2, and 217.1.
University of Toronto Press, 1983) 418-91. 23. S. Bittle, Still Dying for a Living: Corporate Criminal Lia-
8. B. Barnetson, The Political Economy of Workplace Injury in bility After the Westray Mine Disaster (Vancouver: Univer-
Canada (Edmonton: Athabasca University Press, 2010). sity of British Columbia Press, 2012); E. Tucker & H. J.
9. R. Kostal, “Legal Justice, Social Justice: An Incursion into Glasbeek, “Death by Consensus: The Westray Story” 3:4
the Social History of Worker-Related Accident Law in New Solut (1993) 14.
Ontario” (1988) 6:1 LHR 1. 24. N. Keith, “After 10 Years, Bill C-45 Yields Few Prosecu-
10. The Meredith Report (Toronto: Lieutenant Governor of tions,” Canadian Occupational Safety (April 2014), online:
Ontario, 1913) (Meredith), online (pdf): <http://www <https://www.thesafetymag.com/ca/news/opinion/
.ontla.on.ca/library/repository/mon/26005/203796s.pdf>. after-10-years-bill-c-45-yields-few-prosecutions/187302>.
11. R. Storey, “From the Environment to the Workplace … 25. R v. Metron Construction Corporation, 2013 ONCA 541.
and Back Again? Occupational Health and Safety Activism 26. Bittle, supra note 23.
in Ontario, 1970s – 2000+” (2004) 41:4 Can Rev Soc & 27. Rudd v. Hamiota Feedlot Ltd., 2006 MBQB 22.
Anthro 419.
28. D. Gilbert & A. Liversidge, Workers’ Compensation in
12. Many OHS scholars believe this assumption is false, Ontario: A Guide to the Workplace Safety and Insurance
noting that the profit imperative may incentivize employ- Act, 3rd ed (Aurora, ON: Canada Law Book, 2001).
ers to trade workers’ health for profit. See J. Foster & B.
Barnetson, Health and Safety in Canadian Workplaces. 29. E. Tompa et al, “Financial Incentives for Experience Rating
(Edmonton: Athabasca University Press, 2016). in Workers’ Compensation: New Evidence from a Program

Change in Ontario, Canada” (2013) 55:3 J Occ & Envtl 34. Details of Ontario’s requirements can be found on the
Med 292. Workplace Safety and Insurance Board website: <https://
30. P. Petrie, Fair Compensation Review: A Review of the www.wsib.ca/en>.
Impact of the Manitoba WCB Assessment Rate Model on 35. WorkSafe British Columbia, Chapter 5—Rehabilitation
Fair Compensation for Workers and Equitable Assessments and Claims Services Manual, Volume II (Vancouver: Work-
for Employers (Winnipeg: Minister of Family Services and SafeBC, 2005), online: <https://www.worksafebc.com/en/
Labour, 2013). resources/law-policy/rehabilitation-services-and-claims
31. E. Tompa et al., “Financial Incentives in Workers’ Com- -manual-volume-ii/rehabilitation-services-and-claims
pensation: An Analysis of the Experience Rating Program -manual-volume-ii/chapter-5?lang=en>.
in Ontario, Canada” (2012) 10:1 Pol’y & Prac in Health & 36. E. MacEachen, S. Ferrier, A. Kosny, & L. Chambers,
Safety 117. “A Deliberation on ‘Hurt versus Harm’ in Early-Return-to-
32. T. Thomason, “The Escalating Costs of Workers’ Compen- Work Policy” (2007) 5:2 Pol’y & Prac in Health & Safety 41.
sation in Canada: Causes and Cures” in T. Thomason, F.
Vaillancourt, T. Bogyo, & A. Stritch, eds, Chronic Stress:
Workers’ Compensation in the 1990s (Toronto: C.D. Howe
Institute, 1995) 23.
33. D. Michaels, “Fraud in the Workers’ Compensation
System: Origins and Magnitude” in T. Guidotti & J.
Cowell, eds, Occupational Medicine: State of the Art
Reviews (Philadelphia, PA: Hanley and Belfus, 1998) 439.


CHAPTER 25
The Right to Work: Immigration

and Mobility Law*
II. A Brief History of Migrant Workers in Canada 407
• Describe the history and policy reasons for migrant worker
III. Migrant Workers and “Flexible Labour” 409
programs in Canada.
IV. Immigration Status in Canada 411
• Explain the different kinds of immigration status and where they A. Citizens, Permanent Residents, and Foreign Nationals 411
come from in federal law. V. Temporary Work Permit Programs in Canada 412
• Understand how immigration status affects foreign workers. A. Live-in Caregiver Program 412
• Describe the rights of migrant workers and some of the remedies B. Seasonal Agricultural Worker Program 413
available when workplace problems arise. C. Temporary Foreign Worker Program 413
D. Open Work Permits 415
VI. The Precarious Status of the Migrant Worker 415
VII. Employment-Related Legal Entitlements and Migrant Workers 416
VIII. Federal Regulation of Employers 418
IX. Chapter Summary 419
I. Introduction
Immigration laws are not usually considered to be part of the law of work because they are not
directly concerned with the rules of the workplace. However, for obvious reasons, rules that
determine who can and cannot work in Canada are of great concern within the law of work
system. If someone is not legally entitled to work, then they are not protected by many of the
legal rules designed to protect employees that we have explored in this part of the book. This
means they are not protected by many of the legal rules designed to protect employees that we
have explored in this part of the book. Therefore, immigration laws play an important boundary
role in the law of work. This chapter examines how, through these laws, Canadian governments
determine who gets to work in Canada and who does not.
II. A Brief History of Migrant Workers in Canada

In Canada, immigration policy has always been linked with the economic benefit of migrant
work. European settlement of Canada was limited to a relatively small number of trading posts
until the early 18th century, when European migration to Canada began to increase substan-
tially. From then until the early 1860s, the greatest number of immigrants came from Britain,
where rapid industrialization had led to chronic unemployment and high numbers of impover-
* This chapter was authored by Sarah Marsden, Thompson Rivers University.
407

ished workers. The British government viewed emigration as preferable to public assistance and
encouraged the poor to move to Canada.1 Mass European colonization of Canada had a pro-
found and often negative impact on the country’s diverse Indigenous peoples, which included
violence, murder, forcible dispossession of land, forced cultural and religious assimilation, and
the introduction of new diseases that led to the decimation of populations.2
Starting in the mid-19th century, Canada actively encouraged immigration. At this time, no
explicit racial distinction was made in Canada’s immigration laws, but the preference was to
recruit northern Europeans, Britons, and Americans. Immigration policy was linked with the
interests of business and industry, and the government encouraged settlement by providing land
to new immigrants working in industry and agriculture. At the outset of the 20th century, south-
ern and eastern Europeans were being recruited specifically for “contract labour” and faced
indenture, poor wages, and poor working conditions.3 Obtaining permanent residence became
more difficult, and laws that excluded people on the basis of poverty or “unsuitability” were
enacted. By the 1920s, immigration laws and policies were explicitly racist, effectively creating
a four-tier system in which (1) British and American nationals were welcomed, (2) other north-
ern Europeans could immigrate primarily through family links, (3) eastern and southern Euro-
peans needed special permits, and (4) Asian and African people were virtually barred.4 Until
1967, ethnic “suitability” remained a part of Canadian immigration law.

Canada’s Discrimination Against Chinese Workers During the Building of the Canadian National
Railway
The second half of the 19th century saw large waves of
Chinese migration to Canada, in large part for the pur-
poses of building Canada’s first national rail line. Chinese
people worked in substandard conditions for a fraction
of the pay that other workers received, and the work was
hazardous. Their labour was essential to the establish-
ment of Canada’s rail system, which provided a necessary
link from east to west. In 1885, after the railway was
completed, the federal government passed the Chinese
Immigration Act, the first immigration legislation in Can-
ada to openly discriminate on the basis of race.
This law’s stated purpose was to restrict the number
of Chinese immigrants in Canada and to regulate and
control Chinese immigrants residing in Canada. The law
forced anyone “of Chinese origin” to pay a $50 entrance
fee (known as a “head tax”) to come to Canada. This was The Chinese head tax certificate for Kung Tsin (Tom Kong), for which he
a significant amount of money at the time, and subse- was required to pay $500 in 1912 upon his arrival in British Columbia.
quent laws raised the amount to $100, and then $500. In Reprinted by permission of Vincent Kong.
1923, the government passed a law to exclude Chinese
people almost entirely from immigration and made it an
* Chinese Immigration Act, 1923, 13-14 Geo. V., c. 38.
imprisonable offence for Chinese people to enter Canada.* In
1930, the government passed an order in council that pro- † Order in Council PC 2115 of September 16, 1930.
hibited the immigration of people of “any Asiatic race.”† ‡ Read about Prime Minister Stephen Harper’s formal apology for the
Chinese head tax here: <https://www.canada.ca/en/news/archive
In 2006, the Canadian government formally apologized to
/2006/06/prime-minister-harper-offers-full-apology-chinese -head-
Chinese Canadians for its racist practices and the head tax, and tax.html>.
paid $20,000 to each surviving head tax payer.‡
indenture: A contractual arrangement in which a person is legally bound to serve another for a period of time.

Chapter 25 The Right to Work: Immigration and Mobility Law 409
The late 1960s and early 1970s was a time of major liberalization in Canadian immigration
policy. In addition to removing ethnic requirements, the government introduced more appeal
rights and procedural protections for people threatened with deportation, and Canada started
accepting refugees for humanitarian resettlement. At the same time, family-based migration
decreased and economically based permanent migration increased. Canada initiated the “points
system,” a way of assessing potential permanent immigrants based on their education, work
experience, and language skills, which were seen as indicators of immigrants’ potential to inte-
grate and contribute economically to Canada.
In 1973, the government introduced the first large-scale temporary worker program, called
the Non-Immigrant Employment Authorization Program (NIEAP), in which employers could
recruit foreign workers.5 Migrant workers were recruited across multiple labour segments and
from many countries, and the number of migrant workers often exceeded the number of perma-
nent economic migrants.6 In the beginning, the NIEAP targeted highly specialized workers,
such as executives and academics, to meet labour market needs. However, in 2006 the federal
government expanded the program to permit employers to request lower-skilled workers to fill
vacancies in such industries as fast food and hospitality services. The growing use of foreign
workers to fill Canadian service jobs has attracted considerable debate and controversy in recent
years, as we will discuss below.
III. Migrant Workers and “Flexible Labour”

Temporary migrant workers have contributed immeasurably to Canada’s economy over the past
40 years. But they often work for lower pay, endure difficult or dangerous working conditions,
and have otherwise been exploited by their employers—all of this without the benefit of perma-
nent residence. Although programs to bring in foreign workers are labelled “temporary,” the
need for foreign workers in our economy seems to be long term, and the number of foreign
workers in Canada is increasing.
Where does the need for foreign workers come from? Migration scholars provide different
answers to this question. Some point out that the labour shortage that migrant workers fill is not
a quantitative shortage, where there is too much work but too few people to do it, but a qualita-
tive shortage.7 This means that there are enough Canadian workers to fill jobs, but because
certain jobs have conditions (including low pay and long hours) that are unacceptable to most
Canadians, Canadians will not take them. For example, if picking blueberries was paid at a rate
of $30 per hour with regular breaks and hours and workplace wellness programs, Canadians
would be much more likely to do this work, but picking blueberries doesn’t pay this well or have
these perks. Canada’s Temporary Foreign Worker Program permits employers to fill undesir-
able jobs without having to pay the higher wages that the Canadian labour market would other-
wise demand. Foreign workers have become a second tier of labour in the Canadian economy.
This second tier of labour serves both specific businesses and the economy at large. Tem-
porary foreign work programs make workers available on terms suitable to employers in what
Judy Fudge calls “an extreme form of flexible labour.”8 Because workers are often tied to specific
employers, they are also “unfree,” in the sense of not being able to circulate in the labour market
as citizens do. An Alberta employment standards adjudicator described temporary foreign
workers as being “handcuffed to a single employer.”9 Some argue that this type of “unfree” labour
is necessary for capitalist economies to function.10 The rise of temporary foreign work programs
can also be understood as an aspect of globalization (see Chapter 27); many industries in which
foreign workers are employed are those in which the labour cannot be moved offshore, such as
agriculture, domestic work, construction, primary industry, and services.
Temporary Foreign Worker Program: A federal government program that allows Canadian employers to hire foreign nation-
als to address temporary labour and skill shortages when qualified Canadian citizens or permanent residents are not available.

In addition to the thousands of workers in Canada under some form of immigrant worker
program, unknown numbers of people reside in Canada without formal legal status. Estimated
numbers of such workers range from 50,000 to 800,000 people.11 Most likely they once had legal
status, but their permits were not renewed. Legal status can change for a number of reasons:
sometimes people do not renew their legal status in time, and sometimes people’s applications
are refused because they do not meet the federal government’s requirements. For example, as we
will see, some foreign workers require an employer sponsor to work in Canada, and an employer
may refuse to renew its support of a foreign worker. Not much information exists about the
working life of people without legal status, but it is safe to assume that many people without legal
status work to support themselves, and that many of their jobs are likely to be in informal or
cash positions, such as construction, domestic work, or food services. Workers without legal
status are extremely vulnerable in the labour market, as they face a constant concern about
enforcement and deportation and have little to no access to social services such as health care.
Basic protections for workers, such as employment standards and a basic minimum wage, may
be harder for these workers to obtain because they are reluctant to assert their rights.
Lilia Ordinario Joaquin, a Filipino nanny working in Toronto, celebrates her exemption from deportation and
can now apply for permanent residence. Her lawyer called her with the news from Canada’s immigration
minister as she was packing her bags to leave Canada.
Source: Vince Talotta/GetStock.com.
The top source countries for foreign workers in Canada in 2016 were the Philippines, Mexico,
Guatemala, India, France, the United States, the United Kingdom and its colonies, the Republic
of Korea, and Jamaica.12 Workers are categorized as “higher skilled” and “lower skilled,” and the
government has set up special programs for domestic and agricultural workers. Racialized
workers are overrepresented in lower-skilled work groups.13 Based on the limited information
available,14 the top occupational areas for migrant workers in the Temporary Foreign Worker
Program are farm and harvesting work, domestic work, food service work, truck drivers, and

food processing.15 Over recent years, an increasing number of foreign workers have entered
Canada, and a growing proportion of them are in the “lower-skilled” group. The number of
temporary foreign workers entering Canada each year is often much larger than the number of
permanent residents entering Canada under the economic class.16
IV. Immigration Status in Canada

As we noted in Chapter 17 when we looked at how the Constitution assigns jurisdiction in
Canada, the federal government is responsible for the laws that affect immigration and citizen-
ship. The main statutes in this area are the Immigration and Refugee Protection Act and the Cit-
izenship Act.17 Both of these acts also have regulations associated with them. These laws play a
role in determining how people obtain, maintain, or lose citizenship or immigration status.
Table 25.1 outlines how a person’s status affects their access to services in Canada.
TABLE 25.1 Worker Status and Access to Public Health Care, Education, and Social Welfare
Subcat Public Educa Social
Status Category egory Subcategory Health Care? tion? Welfare?
Citizens — — Yes Yes Yes
Permanent residents — — Yes Yes Yes
Foreign nationals Foreign “Low-skilled”: requires LMIA* Yes Yes No

workers
“High-skilled”: requires LMIA Yes Yes No
Live-in caregivers: requires LMIA Yes Yes No
Seasonal agricultural workers Yes Yes No
Working holiday permit holders No No No
Students authorized to work during or after their studies Yes Yes No
Open work permit holders (spouses of high-skilled Limited Yes Yes

workers, refugee claimants awaiting determination)
Workers without documentation No No No
Students — Yes Yes No
Visitors — No No No
Note: Refugee claimants do not formally have legal status, and others enter or remain without status. Social welfare, education, and health care are
governed by the provinces, and services vary; many services are only contingently or inconsistently available to temporary workers because of policies
and practices requiring confirmation of migration status.
* Labour Market Impact Assessment (discussed below).
A. Citizens, Permanent Residents, and Foreign Nationals

A majority of people in Canada are Canadian citizens. People become Canadian citizens by
being born in Canada, having Canadian parents, or obtaining permanent residence and then
staying in Canada for a certain number of years.18 Canadian citizens have the right to vote, enter
and remain in Canada, and live and work in Canada. Until recently, citizenship could only be
lost if a person gave it up voluntarily (revocation) or if a naturalized citizen obtained citizenship
Canadian citizen: A person who meets the definition of a “citizen” in the Canadian Citizenship Act and who therefore enjoys
all the privileges and is subject to all the obligations of Canadian citizens in Canadian and international law.

or immigration status by fraud. However, the federal government has recently expanded the
ways in which citizenship can be revoked. For citizens who have access to citizenship in other
countries (potential dual citizens), the government can now revoke citizenship for terrorism and
national-security-related matters. These changes may be challenged in court on the basis that
they are unconstitutional.19
People become permanent residents (also known as landed immigrants) if they meet the
government’s requirements for economic immigration, if they are sponsored by a family mem-
ber, or if their case is accepted for refugee or humanitarian reasons.20 Permanent residents are
similar to citizens in some ways, but different from them in others. Like citizens, they have the
right to enter and remain in Canada and to live and work here, but they do not have the right to
vote. Permanent residents must meet a residency requirement by staying in Canada for two
years out of every five; otherwise they risk losing their status. They can also lose their status if
they are convicted of or commit certain serious criminal offences or human rights violations.
If a person does not have citizenship or permanent residence in Canada, they are “foreign
nationals” at law.21 Foreign nationals are visitors to Canada and need a temporary permit to
enter Canada. Temporary permits include visitor visas, study permits, and work permits.22 All
temporary permits have time limits and conditions: for example, people with visitor visas are
generally not allowed to work. Work permits allow people to work in Canada, but they have
specific conditions attached to them; for example, a permit holder must leave Canada at the end
of the authorized stay or may have to work for a specific employer. Rules about work permits
have a serious impact on the rights and obligations of foreign workers, and, therefore, we will
now spend some time exploring how work permits are organized and some of the problems
foreign workers face.
V. Temporary Work Permit Programs in Canada

Canada’s immigration laws recognize a variety of different streams through which foreign
nationals can gain temporary access to jobs in Canada.
A. Live-in Caregiver Program

Canada has a work permit program designed specifically to bring in domestic workers to care
for children, people with disabilities, or elderly people. The program leads eventually to perma-
nent resident status for workers who complete a number of years of work in Canada. The average
annual number of new foreign workers that entered Canada under the Live-in Caregiver Pro-
gram from 2007 to 2016 was 15,749.23 In 2016, Live-in Caregiver work permit holders made up
over 9 percent of the total foreign worker entries to Canada.24 A vast majority of workers in this
program are women from the Philippines. Workers have been unable to bring their families with
them, which has led to years of separation between these workers and their spouses and chil-
dren.25 While many migrant workers eventually obtained permanent residence in Canada under
the Live-in Caregiver Program, this program has historically been plagued by long procedural
delays, employer abuse, and unfair working conditions.26 Until recently, caregivers were tied to
one specific employer on their work permit, and they were authorized to work only for that em-
ployer. This means that when a caregiver needed to leave a bad workplace or was laid off, it was
difficult for them to get a new work permit.
permanent resident: An immigration status under Canadian immigration law that grants a person of foreign origin many but
not all rights available to Canadian citizens. For example, a permanent resident’s voting rights are restricted.
landed immigrant: See permanent resident.
work permit: A legal authorization issued by the Canadian government that permits a non-Canadian citizen to work tem-
porarily in Canada.

As of 2019, in response to concerns about delays, family separation, and complications in

obtaining permanent residence, the federal government announced a new program in which
workers will be able to work in Canada in home support or home child-care streams. The federal
government has stated that workers will require two years of work to become permanent resi-
dents. Most notably, the federal government has also promised that these workers will now be
issued sector-based, rather than employer-based, work permits. This means they will be able to
move to a new employer at will, rather than relying on a new employer’s approval, as they have
in the past. Finally, the government has promised to allow spouses and children of caregivers to
accompany them to Canada, with work permits and study permits.27 These changes respond to
many of the concerns raised by caregivers in recent years.
B. Seasonal Agricultural Worker Program

Canada has a foreign worker program in which seasonal labourers come to Canada from spe-
cific countries to undertake work in cultivating and harvesting fruits, vegetables, flowers, and
trees as well as work involving animals. This program, known as the Seasonal Agricultural
Worker Program, is based on agreements between Canada and a short list of source countries,
including Mexico and multiple Caribbean countries. Under this program, farms hire foreign
workers for a maximum of eight months per year. Wages for each occupation are set by the
federal government.28
As with the Live-in Caregiver Program, workers in this program are at risk of exploitation
and substandard working conditions. Workers are also attached to a specific employer through
their work permits and cannot easily change jobs if they need to because, like workers in the
Live-in Caregiver Program, they also require a Labour Market Impact Assessment (LMIA) to
do so. Also, these workers cannot bring their families with them when they come to work in
Canada. Unlike workers in the Live-in Caregiver Program, however, foreign agricultural work-
ers do not qualify for permanent residence through their work in Canada; they often return
to Canada for many years, never obtaining permanent status. In 2018, seasonal agricultural
positions made up 46.7 percent of the total number of approved temporary foreign worker pos-
itions, up from 19.1 percent in 2011.29
C. Temporary Foreign Worker Program

As mentioned above, apart from special programs for caregivers and agricultural workers,
Canada also has a general Temporary Foreign Worker Program. In this program, workers are
divided into “higher-skilled occupations” and “lower-skilled occupations.” The number of work
permits granted under this program has grown exponentially in recent years. As a result, the
program has come under intense public scrutiny and criticism for permitting employers to use
foreign workers rather than attract Canadian workers to the same jobs (see Box 25.2). Workers
under the Temporary Foreign Worker program still have “closed” work permits, in which they
are tied to a specific job and a specific employer. This requirement put employers in an increased
position of power over these workers—unlike other Canadian workers, foreign workers with
closed work permits do not have the option of quitting and finding a new job, because they first
need to find an employer who is willing to obtain permission to hire them. In order to obtain
that permission from the federal government, the prospective employer needs to apply for a
Labour Market Impact Assessment (LMIA).30
Labour Market Impact Assessment (LMIA): An assessment of labour market conditions conducted by the federal gov-
ernment whose purpose is to determine whether an absence of Canadian workers to fill a vacancy justifies issuing a temporary
work permit to a foreign national.


Temporary Foreign Workers and the Tumbler Ridge Mining Project
Construction and Specialized Workers’ Union, Local 1611 of the work to get permission to hire temporary foreign work-
v. Canada (Citizenship and Immigration) ers rather than Canadian workers, and that the federal govern-
2013 FC 512 ment should not have granted permission.
Key Facts: In this case, two unions launched the first court Issue: Was the federal government’s positive Labour Market
challenge of a positive Labour Market Opinion (ostensibly an Opinion unreasonable?
assessment of the effect that hiring temporary foreign workers
will have on the Canadian labour market) by the federal gov- Decision: No. The unions’ case was dismissed. Justice Zinn
ernment. In a much-publicized case, HD Mining International found that the federal officer who issued the Labour Market
applied for and received a positive Labour Market Opinion to Opinion had followed the statutory guidelines and did not err
hire 201 temporary foreign workers from China to undertake in his decision. Nonetheless, it is likely that similar cases will
extraction work at its Tumbler Ridge mining operation. The come before the Federal Court concerning the hiring of tem-
unions claimed that HD Mining had misrepresented the nature porary foreign workers.
Poor government oversight of the Temporary Foreign Worker Program has allowed some
Canadian employers to misuse the program, as explained in the story described in Box 25.3.31

Federal Government Steps Up Monitoring for Temporary Foreign Workers Program
The following excerpt describes how the federal government Kameron Coal Management Ltd. was banned
responded to an auditor’s report that the Temporary Foreign from the program for a year and ordered to pay
Worker program lacked oversight: $54,000—the largest fine to date. The Cape Breton
mining company faced criticism from a local union
The federal Liberal government, chastised last year two years ago for hiring foreign workers where quali-
in an auditor’s report that found a lack of oversight fied locals were available for work.
of Canada’s controversial temporary foreign workers Employers are given the chance to address any
program, is stepping up employer inspections and red flags and improve working conditions for tem-
naming and shaming those caught breaking the porary foreign workers, which is preferable to simply
rules. imposing sanctions, the department said in a written
Since the start of the year, roughly 1,600 employ- statement.
ers have been flagged as “high-risk employers” and “In over 45 per cent of our cases (in 2017 – 18),
selected for inspections by the Employment and employers willingly took corrective measures in
Social Development Department, with more than areas where they were initially found non-compliant
1,340 on-site inspections launched and in various to come into compliance with program conditions,”
stages of completion. the statement said.
That’s more than seven times the number of on- “Employers who do not, continue to be subject
site inspections conducted during the same period to serious penalties.”
in 2016 – 17. …
A list of penalized companies and employers has
Source: Excerpt from Teresa Wright, “Liberals Step Up Monitoring for
been posted online. Since August 2017, the number Temporary Foreign Workers Program,“ The Canadian Press. Retrieved from
of sanctioned employers jumped to 62 from just one. <https://www.cbc.ca/news/politics/government-temporary-foreign-
Many have been banned from using the program for workers-audit-1.4661312>. Used with permission.
up to two years, while others have been hit with fines.
1. Higher-Skilled Occupations

Higher-skilled occupations are those that require education or formal training from a university,
college, or trade or vocational school. For example, a carpenter would be considered “higher
skilled,” and so would a business manager or a visual artist. Higher-skilled workers also have the

benefit of being able to obtain an open work permit (discussed below) for their spouse or partner
who accompanies them to Canada.
Most higher-skilled workers require an LMIA, but some do not (e.g., workers who come to
Canada as part of a trade agreement such as NAFTA, and workers who are moved from a foreign
branch to a Canadian branch of the same company). Higher-skilled workers are often still
bonded to one specific employer and may also have trouble changing jobs if they need to, but
they are much more likely to be able to obtain permanent residence, which would give them the
opportunity to freely circulate in the labour market. Higher-skilled workers can apply for
permanent residence under economic classes such as Federal Skilled Worker, Federal Skilled
Trades, and Canadian Experience Class.
2. Lower-Skilled Occupations

Workers in “lower-skilled” occupations constitute a growing proportion of the foreign workers
in Canada.32 Work classified as “lower skilled” includes work that involves on-the-job training
or does not require more than a secondary school level of education. Examples of lower-skilled
positions are office clerks, drivers, oil and gas drilling operators, food servers, tourism workers,
machine operators, and assembly-line workers. Both agricultural workers and domestic workers
are also classified as lower skilled, regardless of the skills and educational background of the
worker. For example, a 2014 study shows that over 80 percent of surveyed workers in the Live-in
Caregiver Program had a university degree.33
Unlike higher-skilled workers, lower-skilled workers are unlikely to qualify for permanent
residence during their time in Canada, even if they remain for a number of years, because lower-
skilled work does not qualify them for permanent residence in the same way that higher-skilled
work would (with the notable exception of caregivers, as described above). Furthermore, a
lower-skilled worker’s spouse or partner is not eligible for an open work permit and requires an
LMIA to apply for a work permit in Canada. The application of the labels “low skilled” and “high
skilled” to certain kinds of work, therefore, has a significant impact on the benefits for a worker.
Some criticize the distinction, arguing that it is not fair to classify certain work as “high skilled”
when much of what is called “low skilled” does require skills, and is also essential to Canada’s
economy, in agricultural and domestic work, but also in retail, construction, and other essential
industries.
D. Open Work Permits

Open work permits do not require an LMIA. This means that an employer does not need to
demonstrate the need for a specific worker to the government, and the work permit is not
bonded to a particular employer: a person can work for any employer in Canada for the duration
of the permit. Open work permits are only available in certain circumstances, usually under a
special program or when they would have a policy benefit. Examples of people eligible for open
work permits include spouses of higher-skilled work permit or study permit holders, people
who have graduated from a Canadian college or university program, and those participating in
a working holiday program. Open work permits are also issued to people who belong to refugee
and humanitarian-protected classes.
VI. The Precarious Status of the Migrant Worker

Because they are not permitted to change jobs without finding a new employer who can obtain
an LMIA, migrant workers with “closed,” employer-specific permits are at a disadvantage if they
are laid off. However, they may also be reluctant to leave an unsafe workplace or report their
employer if their working conditions and wages fall below legal standards. Migrant workers have
open work permit: A legal authorization issued by the Canadian government to a foreign national who meets certain criteria
permitting them to work for any employer in Canada. This permit does not require a Labour Market Impact Assessment.

less bargaining power with their employer, and the employer has more power over the workers
relative to Canadian workers. Even for migrant workers with an open work permit, fear over
losing their immigration status can act as a deterrent from reporting poor work conditions or
negotiating with their employers for better working conditions or wages.
As outlined above, migrant workers come to Canada under many different programs, and
they obtain employer-specific or open work permits in a variety of different situations. But all
of them are workers in Canada’s labour market, and none of them has permanent status. Soci-
ologist Luin Goldring suggests that the idea of “precarious status” is a way of understanding the
impact of less than full migration status. For Goldring and her colleagues, “precarious status”
can include the lack of permission to work or to stay in Canada, dependence on a third party
for the right to be in Canada (such as an employer), and lesser access to social entitlements such
as education and health.34
Precarious status is a useful concept because it allows us to consider the effect of non-permanent
status on different groups of workers. For example, a domestic worker in the Live-in Caregiver
Program would be precarious because they rely on the employer’s support for a work permit
extension, but a refugee claimant with an open work permit would also be precarious because
their status is dependent on the outcome of a refugee hearing. Workers with precarious status
experience negative health and social impacts, as well as a lack of access to various necessary
services.35
Precarious status does not affect everyone equally. It can interact with other forms of priv-
ilege or disadvantage, including class, nationality, race, gender, and disability, and the level of
privilege the person has may insulate them from the impacts of precarious status. For example,
an upper-class student from England who is in Canada for a working holiday after graduating
would likely be much less susceptible to harm and exploitation than an agricultural worker from
Jamaica trying to support their lower-income family. Sociologist Nandita Sharma has linked the
temporary foreign work programs in Canada to the racialization of workers and tied these pro-
grams to Canada’s record of race-based immigration laws.36 Precarious work is gendered as well;
for example, Geraldine Pratt shows that Canada’s domestic work program is part of the femini-
zation of caring work as part of a global supply chain.37
VII. Employment-Related Legal Entitlements and Migrant Workers

Migrant workers in Canada have faced many workplace difficulties, including unpaid wages,
unpaid overtime, a lack of breaks and mealtimes, and other exploitive employer practices. The
federal work permit system allows employers to offer lower-than-average wages to foreign work-
ers,38 but migrant workers can, and some have, used both provincial employment standards
tribunals and the courts to enforce their statutory and contractual employment rights.39 In a
recent case, temporary foreign workers employed by Denny’s restaurants were awarded a settle-
ment for violations of employment contracts and employment standards legislation amounting
to nearly $1.5 million, as described in Box 25.4.

Denny’s Restaurant Chain Settles Foreign Worker Class Action Lawsuit
Dominguez v. Northland Properties Corporation by the employer of the province’s employment standards legis-
2013 BCSC 468 lation, including failing to pay overtime and committing vari-
ous breaches of employment contracts (e.g., the requirement
Key Facts: Seventy-seven employees of Denny’s restaurant in to provide 40 hours of work per week). The employees were
British Columbia filed a class action lawsuit alleging violations in Canada under the Temporary Foreign Worker Program, and

most of them were from the Philippines. The employees were secure permanent residence status and must return
required to pay fees ranging from about $2,500 to $6,000 to a home).
third-party recruitment company to apply for positions at • Denny’s would establish a settlement fund in the
Denny’s. The employees continued to work for Denny’s after amount of $300,000 to reimburse employees for
the lawsuit was filed, and some alleged that Denny’s “sug- recruitment fees paid to any third party as a condition
gested to them that they should decide to opt out of these of receiving a placement at Denny’s.
proceedings rather than run the risk of losing their employ- • Denny’s would donate $40,000 to a local BC charity
ment with Denny’s or otherwise losing support from Denny’s that assists temporary foreign workers and an addi-
in relation to their work permits or in obtaining permanent tional $40,000 to a local children’s charity.
residency status in Canada.” The court issued an order that • Denny’s would pay $425,000 in legal fees and dis-
there could be no repercussions against employees who par- bursements to the employees’ lawyers.
ticipated in the lawsuit. • When Denny’s fulfills its obligations under the settle-
The class action was certified by the court and permitted ment, the employees would provide a full release
to proceed.* The case went to mediation and a proposed against all claims against Denny’s.
settlement was reached. That settlement included the follow-
ing terms: Issue: Was the proposed settlement fair and reasonable, as
required by the BC Class Proceedings Act?
• Since the employment contracts required the employ-
ees to be given at least 37.5 or 40 hours of work per Decision: Yes. The court assessed the total value of the settle-
week, Denny’s would pay each employee any shortfall ment at about $1.425 million to be paid by Denny’s and ruled
in the entitled number of hours and actual number of that the settlement was fair and reasonable to the employees.
hours worked. Therefore, the court approved the settlement.
• Denny’s would pay all unpaid overtime.
• Denny’s would reimburse employees for their airfare * Dominguez v. Northland Properties Corporation, 2012 BCSC 328.
cost from their home country and back (if they fail to
As the Dominguez case shows, migrant workers have the same formal rights as any other
workers with regard to hours of work and pay, including termination pay, overtime, minimum
wage, mealtime breaks, hours of work, and unlawful fees (such as recruitment fees to find a job).
However, big legal wins like this are rare. As noted above, unlike citizen workers, migrant work-
ers may be concerned about losing their immigration status or having to leave Canada if they
try to enforce their rights. They are particularly vulnerable to exploitation.40 When they do en-
force their rights, they cannot use employment law remedies to maintain their immigration
status. In other words, a court or tribunal may order the payment of money to the workers; but
if a worker has lost their work permit, that worker cannot obtain a new work permit from an
employment tribunal. For some workers, maintaining their status or eventually obtaining
permanent residence is the most important part of their work in Canada, and employment law
remedies cannot help with this.
Migrant workers are overrepresented in the most onerous forms of work, sometimes referred
to as “3D” work: dirty, difficult, and dangerous.41 Migrant workers are covered by workers’ com-
pensation laws (and employment standards laws), but they do not always have equal access to
the protection of those laws. For example, in Ontario, the Workplace Safety and Insurance Board
can reduce or stop an injured worker’s benefits if the worker is “deemed” able to return to a dif-
ferent job. This policy is a major problem for migrant workers, because without a work permit,
they cannot work at a different job “deemed” appropriate for them.42 Although migrant workers
are treated “just like any other workers,” their access to the benefit of the law falls short because
they are different from citizen workers in important ways.
Although none of Canada’s human rights statutes prohibits discrimination on the basis of
“immigration status” or “migrant worker status,” all prohibit discrimination on the basis of race,
ethnicity, citizenship, place of origin, or nationality. Discrimination against migrant workers is

often captured by one or more of these grounds, and migrant workers have made claims using
these grounds. In one example, a group of Latin American migrant workers made a human
rights claim on the basis that they received less than the European migrant workers doing the
same work at their job site.43 Represented by their union, the workers won back wages and an
award for injury to dignity, feelings, and self-respect. In British Columbia, migrant workers
from the Philippines and Mexico have brought cases before the human rights tribunal alleging
discrimination in employment practices on the basis of race, colour, ancestry, and place of ori-
gin.44 In a 2015 Ontario case, two women migrant workers from Mexico filed a human rights
claim on the basis that they had experienced ongoing sexual harassment and assault by their
employer while working at a fish processing plant. The Ontario Human Rights Tribunal consid-
ered the discrimination on the basis of sex, but also took into account the particular vulnerabili-
ties associated with being a migrant worker. The tribunal heard expert evidence from Dr. Kerry
Preibisch and found the following:
Given the nature of the temporary foreign worker program, the fact that work permits are tied to a
specific employer, and that trying to find a different employer while in Canada poses immense dif-
ficulties for a migrant worker, including the need for any new employer to qualify for the program
by obtaining a labour market opinion and the reality that in the interim migrant workers would lose
access to the accommodation provided by their existing employer, the reality is that renewing her
contract with Presteve was the only real choice that [the worker] had if she wanted to remain in
Canada and continue working legally to help support her children.45
In this case, the Ontario Human Rights Tribunal made orders of $150,000 and $50,000
against the employer, making this one of the largest awards for injury to dignity ever made by a
Canadian human rights tribunal.
VIII. Federal Regulation of Employers

The federal government is responsible for issuing work permits and for approving the requests
of employers to hire foreign workers. While it cannot directly enforce provincial employment
standards, it has the power to grant or deny permits and also to investigate and penalize employ-
ers who exploit migrant workers. The federal government (through Economic and Social De-
velopment Canada, or ESDC) has been able to “blacklist” employers for failing to provide
promised wages and other problems since 2011, but this power has only been exercised since
2014. Tens of thousands of employers in Canada hire foreign workers, and so far the ESDC
website lists 54 employers who have had an LMIA revoked and a further 93 who have been
subjected to fines.46
Since 2015, ESDC has been granted expanded enforcement powers under immigration law.
Based on tips received online, by phone, or through random selection, officers can now search
employer premises, require the employer to produce documents, and interview workers and
others to determine whether the employer is compliant. This law has also created clear standards
for the employers of migrant workers. Among other things, employers must abide by the wages,
occupation, and working conditions promised to the worker; they must comply with federal and
provincial laws that regulate employment; and they must “make reasonable efforts to provide a
workplace that is free of abuse.”47 This new law is promising, but it is still in the early stages of
implementation, and it is difficult to know whether it will improve the working conditions of
migrant workers or effectively deter employers from exploitative practices.
Finally, there is a new pilot program in British Columbia in which migrant workers who can
show they are “at risk of abuse” are now able to apply for six-month open work permits, with the
assistance of migrant-serving organizations. The federal government has proposed expanding
this pilot program to all of Canada.48 This way, workers may be able to leave bad employers more
quickly and have an easier time finding new work. Like the new employer standards, this

program is new and it holds promise, but it has not yet been studied to find out whether it will
create meaningful change for workers.
Migrant workers form a growing proportion of the Canadian workforce, and they often face
exploitive workplace conditions as well as barriers because of their non-permanent status. Con-
cerns and disputes over migrant worker rights will be increasingly relevant to the laws governing
workplaces. Some critics claim that we should eliminate temporary foreign work programs
entirely.49 Others propose significant changes to the system, such as the elimination of employer-
specific permits, better access to permanent residence, and equal treatment of higher- and
lower-skilled workers.50 Laws and policies pertaining to migrant workers continue to evolve,
influenced not only by government policy and court and tribunal decisions but also by the work
of unions, advocates, researchers, and community organizers.
IX. Chapter Summary

This chapter explained the role and history of migrant workers in Canada. It also reviewed the
way migrant workers are regulated by the federal government in immigration law. Migrant
workers’ lack of permanent status has many complex effects on their workplace rights, and this
chapter has explained some of the major issues migrant workers face and some of the remedies
available to address these issues.

1. How would you characterize the role of migrant workers in Canada historically?
2. Why do employers need permission to hire migrant workers?
3. How does the federal government categorize migrant workers, and how does this catego-
rization affect workers?
4. What are some of the major differences between migrant workers and citizen workers in
Canada?
5. Migrant workers are often formally entitled to the same workplace standards (such as min-
imum wage) as citizen workers, but they do not always have the same access to meaningful
resolutions. Why is this?
6. What key issues do lower-skilled migrant workers face? What changes would be most ef-
fective in resolving them? Who should be responsible for making those changes?

1. J.M. Bumsted, Canada’s Diverse Peoples: A Reference 5. A note on terminology: foreign worker refers to a person
Sourcebook (Santa Barbara, CA: ABC-CLIO, 2003) at 108; who has a foreign work permit, whereas migrant worker
and Exodus, “The Great Migration of Canada,” online: refers to anyone who is in Canada without permanent
<http://www.exodus2013.co.uk/the-great-migration status who is working in Canada (and includes a person
-of-canada>. without status or with expired status).
2. For a history of Indigenous – settler relations in Canada, 6. N. Sharma, “On Being Not Canadian: The Social Organiz-
see, J. Sutton Lutz, Makuk: A New History of Aboriginal – ation of ‘Migrant Workers’ in Canada” (2001) 38:4 Can
White Relations (Vancouver: University of British Rev Soc 415 at 425.
Columbia Press, 2008). 7. Ibid.
3. For a detailed treatment of labour migration in Canada, 8. J. Fudge & F. MacPhail, “The Temporary Foreign Worker
see D. Avery, Reluctant Host: Canada’s Response to Immi- Program in Canada: Low-Skilled Workers as an Extreme
grant Workers, 1896 – 1994 (Toronto, ON: McClelland & Form of Flexible Labour” (2009) 31 Comp Lab L & Pol’y J
Stewart, 1995). 5 at 11.
4. N. Kelley & M. Trebilcock, The Making of the Mosaic: A 9. 639299 Alberta Ltd v. Meganathan, 2013 CanLII 87001
History of Canadian Immigration Policy (Toronto, ON: (Alta. ESU) at para 20.
University of Toronto Press, 2010).

10. See, for example, R. Cohen, Migration and Its Enemies: 24. Government of Canada, supra note 23.
Global Capital, Migrant Labour, and the Nation-State 25. G. Pratt, “Circulating Sadness: Witnessing Filipina
(Aldershot, UK: Ashgate, 2006); and V. Satzewich, “Unfree Mothers’ Stories of Family Separation” (2009) 16:1 Gend
Labour and Canadian Capitalism: The Incorporation of Place Cult 3.
Polish War Veterans” (2010) 28 Stud Pol Econ 89.
26. See, for example, M. Sargeant & E. Tucker, “Layers of Vul-
11. D. Tilson, Temporary Foreign Workers and Nonstatus nerability in Occupational Safety and Health for Migrant
Workers (Report of the Standing Committee on Citizenship Workers: Case Studies from Canada and the UK” (2009) 2
and Immigration) (Ottawa: Library of Parliament, 2009). Pol’y & Prac in Health & Safety 51; K. Preibisch, “Pick-
12. Citizenship and Immigration Canada, “Facts and Figures Your-Own-Labor: Migrant Workers and Flexibility in
2016: Immigration Overview—Permanent and Temporary Canadian Agriculture” (2010) 44:2 Intl Migr Rev 404;
Residents, Table 1.5: Temporary Foreign Worker Program L. Binford, “From Fields of Power to Fields of Sweat: The
Work Permit Holders with a Valid Permit on December 31 Dual Process of Constructing Temporary Migrant Labour
by Top 50 Countries of Citizenship,” online: <https://open in Mexico and Canada” (2009) 30:3 Third World Q 503;
.canada.ca/data/en/dataset/6609320b-ac9e-4737-8e9c and S. Marsden, “Silence Means Yes Here in Canada: Pre-
-304e6e843c17>. carious Migrants, Work, and the Law” (2014) 18:1 CLELJ.
13. Fudge & MacPhail, supra note 8; and N. Sharma, Home 27. Government of Canada, “Table 1: Number of Temporary
Economics: Nationalism and the Making of “Migrant Foreign Worker (TFW) Positions on Positive Labour
Workers” in Canada (Toronto, ON: University of Toronto Market Impact Assessments (LMIAs) by Province/Terri-
Press, 2006). tory Between 2011 and 2018”; Table 9: Number of Tem-
14. There are limits to what we know about the industries in porary Foreign Worker (TFW) Positions on Positive
which foreign workers are employed, because this infor- Labour Market Impact Assessments (LMIAs) Under the
mation is only available for workers whose employer is Primary Agriculture Stream by Province/Territory
specified on their work permit. Between 2011 and 2018,” online: <https://open.canada.ca/
data/en/dataset/76defa14-473e-41e2-abfa-60021c4d934b>.
15. Immigration, Refugees, and Citizenship Canada, “Tem-
porary Foreign Worker Program 2011-2018, Table 7: 28. Employment and Social Development Canada, “Hire a
Number of Temporary Foreign Worker (TFW) Positions Temporary Worker Through the Seasonal Agricultural
on Positive Labour Market Impact Assessments (LMIAs) Worker Program: Overview,” online: <https://www.canada
by National Occupation Classification—2001 (NOC) Skill .ca/en/employment-social-development/services/foreign
Type, and Province/Territory Between 2011 and 2018,” -workers/agricultural/seasonal-agricultural.html>.
online: <https://open.canada.ca/data/en/dataset/ 29. Government of Canada, Table 1 and Table 9, supra
76defa14-473e-41e2-abfa-60021c4d934b>. note 27.
16. Citizenship and Immigration Canada, supra note 12 at 6 30. See an explanation of the Labour Market Impact Assess-
and 62. ment here: Government of Canada, “What Is a Labour
17. Immigration and Refugee Protection Act, SC 2001, c. 27; Market Impact Assessment?” <http://www.cic.gc.ca/
and Citizenship Act, RSC 1985, c. C-29. english/helpcentre/answer.asp?qnum=163&top=17>.
18. See Citizenship Act, supra note 17, s. 3. 31. See also “RBC Replaces Canadian Staff with Foreign
Workers,” CBC News (April 2013), online: <http://www
19. T. MacCharles, “Rocco Galati Plans Legal Challenge to
.cbc.ca/news/canada/british-columbia/rbc-replaces
Citizenship Act Changes,” Toronto Star (June 2014),
-canadian-staff-with-foreign-workers-1.1315008>.
online: <http://www.thestar.com/news/canada/2014/06/
09/rocco_galati_plans_legal_challenge_to_citizenship 32. Lower-skilled jobs as a growing proportion, charted by
_act_changes.html>. “occupation skill level.” See Government of Canada, “Table
1.7: Temporary Foreign Worker Program Work Permit
20. Immigration and Refugee Protection Act, supra note 17,
Holders with a Valid Permit on December 31st by Gender
s. 12.
and Occupational Skill Level, 2007 to 2016,” online:
21. Ibid., s. 20. <https://open.canada.ca/data/en/dataset/6609320b
22. Ibid., s. 30. -ac9e-4737-8e9c-304e6e843c17>.
23. Immigration and Refugee Protection Regulations, SOR 33. Rupa Banerjee, Philip Kelly, Ethel Tungohan, et al., Assess-
2002-227, ss. 110-15. Government of Canada, “Table 3.1: ing the Changes to Canada’s Live-In Caregiver Program:
Temporary Foreign Worker Program Work Permit Improving Security or Deepening Preaciousness (2017),
Holders by Program and Sign Year, 2007 to 2016,” online: online (pdf): <http://p2pcanada.ca/files/2017/12/
<https://open.canada.ca/data/en/dataset/6609320b-ac9e Assessing-the-Changes-to-Canadas-Live-In-Caregiver
-4737-8e9c-304e6e843c17>. -Program.pdf>.

34. L. Goldring, C. Berinstein, & J. Bernhard, “Institutional- 43. CSWU Local 1611 v. SELI Canada and Others (No. 9), 2009
izing Precarious Migratory Status in Canada” (2009) 13:3 BCHRT 161.
Citizensh Stud 239 at 240. 44. Peart v. Ontario (Community Safety and Correctional Ser-
35. L. Goldring & P. Landolt, eds, Producing and Negotiating vices), 2014 HRTO 611.
Non-Citizenship: Precarious Legal Status in Canada 45. O.P.T. v. Presteve Foods Ltd., 2015 HRTO 675 at para 132.
(Toronto, ON: University of Toronto Press, 2013). See also United Steelworkers obo Others v. Tim Hortons and
36. Fudge & MacPhail, supra note 8. others, 2014 BCHRT 152; and Chein and Others v. Tim
37. G. Pratt, Working Feminism (Philadelphia, PA: Temple Hortons and Others, 2013 BCHRT 229.
University Press, 2004). 46. Government of Canada, “Employers Who Have Been
38. Government of Canada, “Hire a Temporary Foreign Non-Compliant,” online: <https://www.canada.ca/en/
Worker in a Low-Wage Position,” online: <https://www immigration-refugees-citizenship/services/work-canada/
.canada.ca/en/employment-social-development/services/ employers-non-compliant.html>.
foreign-workers/median-wage/low.html>. 47. Immigration and Refugee Protection Regulations, supra
39. A CanLII database search of “Temporary Foreign Worker note 23, ss. 209.1-209.91.
Program” will lead you to some of the decisions arising 48. Government of Canada, “Regulations Amending the
from these complaints. Immigration and Refugee Protection Regulations,” 152:50
40. See Lee v. ScotiaCare Homecare & Caregivers Inc., 2014 Can Gazette, online: <http://www.gazette.gc.ca/rp-pr/
NSLB 53. p1/2018/2018-12-15/html/reg1-eng.html>.
41. See, for example, A. Bakan & D. Stasiulis, “Marginalized 49. See calls by No One Is Illegal to abolish the foreign worker
Dissident Non-Citizens: Foreign Domestic Workers” in program. See No One Is Illegal, “Foreign Temporary
B. Walker, ed, The History of Immigration and Racism in Workers,” online: <https://noii-van.resist.ca/issues/foreign
Canada: Essential Readings (Toronto, ON: Canadian -temporary-workers>; and No One Is Illegal, “No One Is
Scholars’ Press, 2008) 264 at 267. Illegal Vancouver—Our Principles and Statements,”
<https://noii-van.resist.ca/about-us/campaign-resources>.
42. J. Hennebry & J. McLaughlin, “‘The Exception That Proves
the Rule’: Structural Vulnerability, Health Risks and Con- 50. See, for example, MigrantWorkersRights Global, “Aboli-
sequences for Temporary Migrant Farm Workers in tion of Employer-Tied Legal Status for Migrant Workers”
Canada” in P. Lenard & C. Straehle, eds, Legislated Inequal- (March 2015), online: <http://www.migrantworkersrights
ity: Temporary Labour Migration in Canada (Montreal, .net/en/campaigns/abolition-of-employer-tied-legal-status
QC: McGill-Queen’s University Press, 2012) 117. -for-migrant>.


CHAP TER 26
Privacy Law at Work*

II. Privacy Legislation in Canada 425
• Understand the legal sources of privacy protection in Canadian
A. Provincial Privacy Acts 425
law.
• Recognize the kinds of privacy issues that can arise in the Protection and Electronic Documents Act 426
workplace. C. Human Rights Statutes and Privacy 429
• Understand the jurisdictional differences in the protection of an III. The Common Law and Privacy at Work 430
employee’s privacy. A. Tort Law 430
• Understand how the protection of an employee’s privacy differs in B. Contract Law 432
a unionized versus a non-unionized workplace. IV. Privacy in the Unionized Workplace 433
V. Recent Case Law Related to Privacy and “Reasonableness” 434
I. Introduction
Canadian privacy law has been characterized as a loose collection of concepts and doctrines that
establish a sort of “legal checkerboard” whose application depends on the jurisdiction and the
status of the employee. The legal protection of privacy in the workplace comes from a variety of
sources (see Table 26.1 for a brief snapshot of the sources of law that touch upon issues related
to privacy at work). These sources include public and private sector privacy statutes, anti-dis-
crimination statutes, the tort of “intrusion upon seclusion,” contract law, and arbitration deci-
sions in unionized environments.1 Some sources of privacy protection overlap in their
application, while others apply exclusively to certain groups of employees.
The aforementioned legal sources of privacy protection are not unified by a universal “right”
to privacy applicable to employees across Canada. Instead, the levels and types of privacy pro-
tection afforded to employees in Canada are entirely dependent on the legal regimes applicable
to the particular employment relationship. Therefore, it would be inaccurate to claim that all
employees in Canada enjoy the same right to privacy and, correspondingly, that all employers
in Canada have the same legal obligations and rights with respect to the collection and use of
information from employees. Determining the right of an employee to privacy and the right of
an employer seeking to collect and retain information about its employees can be a complex
exercise. This chapter provides an overview of the various sources of workplace privacy law and
the employment contexts to which they apply.
* This chapter was authored by John Craig and Justine Lindner.
423

TABLE 26.1 Sources of Law That Govern Issues Related to Privacy at Work
Source of Law Jurisdiction(s) Conduct Regulated Enforcement
Regulatory Regime: BC, Saskatchewan, Manitoba, Legislation creates a new “tort of Lawsuit in court for violation of
Privacy Legislation Newfoundland and Labrador, privacy” that protects workers from the tort that is created by the
Quebec unreasonable invasions of privacy. statute
The employer’s business interests
are weighed against the employee’s
expectation of privacy in the
circumstances.
Regulatory Regime: Federal: Personal Information PIPEDA applies only to federally Complaint filed with a privacy
Information Privacy Protection and Electronic Documents regulated companies, like banks, commissioner, who investigates
Legislation Act (PIPEDA) airlines, and telecommunications and issues a report; if either party
companies (see Chapter 17). Regu- is unhappy with the report, they
Alberta, British Columbia, and lates the collection and disclosure of can bring an action in federal
Quebec have enacted their own personal information that could court
similar legislation that applies to disclose information about the
provincially regulated employers employee, including contact infor-
mation and images. Employers may
collect information about employ-
ees if a “reasonable person” would
consider it appropriate in the cir-
cumstances. Often the employer
requires employee consent to
collect and disclose personal infor-
mation, but the statutes create
some exceptions to this.
Regulatory Regime: All jurisdictions It is unlawful for employers to rely Complaint filed under human
Human Rights Legislation on some types of personal informa- rights legislation
tion related to “prohibited grounds”
in making employment-related
decisions. For example, an employer
cannot ask a job applicant about
their religion or marital status and
cannot consider those characteris-
tics in decision making.
Common Law Regime: So far, this tort has been recognized Tort applies when an employer Lawsuit in court alleging the tort
Tort of “Intrusion upon by courts in Ontario, Manitoba, and intentionally violates an employee’s was committed
Seclusion” Nova Scotia, but other provinces privacy at work “without lawful
may follow justification” if the intrusion is highly
offensive and would cause distress,
humiliation, or anguish to a reason-
able person.
Common Law Regime: All jurisdictions An expressed or implied contract Lawsuit in court for breach of
Contracts term may protect employee privacy. contract
Collective Bargaining All jurisdictions, in unionized Arbitrators have recognized an Grievance filed under the collec-
Regime: Labour Arbitra- workplaces implied right of privacy in arbitra- tive agreement that, if not settled,
tion Law tion case law. Employers must justify would be litigated before a labour
any intrusion on employee privacy arbitrator
with reference to pressing business
concerns that outweigh employee
privacy concerns.
Before we delve into a discussion of workplace privacy law in Canada, it is useful to consider
how technology, which is often central to concerns about privacy, has affected the legal protec-
tion of privacy interests (see Box 26.1).

Chapter 26 Privacy Law at Work 425

Emerging Issues in Technology and Privacy
Historically, one of the main drivers of privacy law has been the can “go viral” and potentially reach hundreds of millions of
rise of technologies that can be used (or abused) to intrude people. Ask yourself:
upon private life. Consider the ever-increasing development
and use of surveillance and communications technologies with Does privacy exist in social media? Can an individual
privacy-invasive potential: video monitoring, listening devices, have any expectation of privacy in anything they put
voice recognition, and global positioning systems, to name just on the Internet? Or is privacy lost the moment an
a few. Today, aerial drones are available and affordable, allow- individual engages with social media? How should
ing users to fly over their neighbours and “spy” on them from the law respond? Should the law permit an employer
the sky. What will be next? Ask yourself: to rely on information posted by an employee on
social media as justification for discipline or termin-
Does privacy exist in modern society, when every- ation of employment?
thing an individual says and does can be monitored,
recorded, and disseminated globally on the Internet? Modern workplaces provide employees with ready access
Or is the legal protection of privacy more important to technologies that can be used to enhance productivity and
and urgent than ever before? Given the availability the work experience but that can also threaten privacy. Ask
and affordability of these technologies, to what ex- yourself:
tent should an employer be permitted to monitor
employees? How important is it for an employer to have clear
policies concerning the proper use of technology at
The rise of social media (Facebook, Twitter, etc.) presents work? What should be included in such a policy?
additional legal challenges. Prior to the widespread use of
social media, an author could only publish information to a These are just some of the difficult questions that arise in
relatively narrow audience. Today, any posting on social media relation to the modern challenge of governing privacy in the
workplace.
II. Privacy Legislation in Canada

As noted in the introduction, Canada has a loose patchwork of privacy legislation. Some prov-
inces have enacted privacy legislation applicable to the workplace, but most have not. In those
provinces that do not have stand-alone privacy legislation, other statutes may indirectly regulate
aspects of workplace privacy, and tort and contract law also may play a minor role in protecting
privacy interests (as we will see below). The federal government has enacted legislation that
affects some aspects of workplace privacy, but that law applies only to federally regulated
employers.
A. Provincial Privacy Acts

Several provinces (British Columbia, Saskatchewan, Manitoba, Newfoundland and Labrador,
and Quebec) have created a tort of invasion of privacy through their privacy legislation.2 That
legislation filled a void in the common law since, until recently, Canadian courts resisted recog-
nizing a general tort of invasion of privacy (as we will discuss below, recent significant move-
ment in that direction has been made).3 For example, British Columbia’s Privacy Act includes a
provision for “violation of privacy actionable”:
1(1) It is a tort, actionable without proof of damage, for a person, wilfully and without a claim of
right, to violate the privacy of another.
(2) The nature and degree of privacy to which a person is entitled in a situation or in relation to
a matter is that which is reasonable in the circumstances, giving due regard to the lawful interests of
others.

(3) In determining whether the act or conduct of a person is a violation of another’s privacy,
regard must be given to the nature, incidence and occasion of the act or conduct and to any domestic
or other relationship between the parties.
(4) Without limiting subsections (1) to (3), privacy may be violated by eavesdropping or surveil-
lance, whether or not accomplished by trespass.4
That provision, and similar language in other provincial privacy legislation, creates a tort of
privacy that enables an employee to sue their employer in court for alleged invasion of privacy.
Damages for infringement of the tort are assessed in accordance with the rules of tort damages
discussed in Chapter 16.
Note that privacy legislation does not necessarily restrict the right of an employer to conduct
surveillance or to search an employee or an employee’s locker, work computer, or even personal
belongings. The courts will weigh the “reasonableness” of the employer’s actions against the
employee’s privacy interests, considering also whether the employee would have a reasonable
expectation of privacy in the circumstances. For example, in Richardson v. Davis Wire Industries
Ltd., a BC court ruled that the Privacy Act was not violated when the employer relied on video-
tape evidence of an employee sleeping on the job in its defence to a wrongful dismissal lawsuit.5
The court found that the employee had no expectation of privacy in the area where the camera
was placed. It also noted that even if the camera were a violation of the Privacy Act, the images
it recorded would have been admissible in the wrongful dismissal lawsuit, since the legislation
“merely provides the foundation for a claim in tort and does not prohibit the admission of
evidence.”6

Protection and Electronic Documents Act
The federal Personal Information Protection and Electronic Documents Act (PIPEDA)7 intro-
duced information privacy law to the federally regulated private sector in 2001, but it expressly
does not apply to provincially regulated employment relationships.8 PIPEDA only applies to
federally regulated private employers (both unionized and non-unionized), such as banks, air-
lines, railways, and telecommunications companies (see the discussion of jurisdiction in Chap-
ter 17). A provincially regulated employer is impacted by PIPEDA only to the extent that the
province in question has enacted substantially similar legislation—and only British Columbia,
Alberta, and Quebec have done so.9 It remains the case today, as in 2001, that provincially regu-
lated private sector employers in the other seven provinces are not subject to information pri-
vacy legislation.
PIPEDA, like the substantially similar provincial laws, regulates “personal information”
about an individual, which is defined as “information about an identifiable individual, but does
not include the name, title or business address or telephone number of an employee of an or-
ganization” (i.e., basic business card information). “Personal information” is a broad concept
and generally includes any information related to an individual that could be used directly or
indirectly to identify the individual, including video and photographs.
The regulatory framework of PIPEDA is built on two fundamental and sometimes conflicting
principles: (1) reasonableness and (2) consent. Hence, section 5(3) of PIPEDA states “[a]n or-
ganization may collect, use or disclose personal information only for purposes that a reasonable
person would consider are appropriate in the circumstances (emphasis added).”10 Section 7(1)
then adds that “an organization may collect personal information without the knowledge or
consent of the individual only if ” certain exceptions apply.11 Even if an individual consents to
the collection of personal information, no exception appears in PIPEDA that would allow col-
lection, use, or disclosure of personal information to occur in unreasonable circumstances.
PIPEDA is uniquely structured because many of its key legal standards are found in a schedule

to the statute.12 This schedule sets out ten privacy principles that were developed by the Can-
adian Standards Association:
1. Accountability.
2. Identifying purposes.
3. Consent.
4. Limiting collection.
5. Limiting use, disclosure, and retention.
6. Accuracy.
7. Safeguards.
8. Openness.
9. Individual access.
10. Challenging compliance.
PIPEDA establishes a process for individuals to make complaints to a privacy commissioner

about alleged privacy invasions.13 Upon receipt of the complaint, the privacy commissioner may
decide to conduct an investigation.14 In the course of an investigation, the privacy commissioner
has considerable powers, including the power to receive evidence, summon witnesses, demand
disclosure of documents, and enter premises.15 Following an investigation, the privacy commis-
sioner is required to report back to the parties with findings and recommendations.16 The pri-
vacy commissioner has no ability to issue binding decisions and orders; it is up to the parties to
either accept or reject the findings and recommendations. If a complainant is dissatisfied with
the outcome at this stage, then section 14 of PIPEDA allows for an application to the Federal
Court for a hearing. This hearing is not an appeal or a judicial review of the privacy commis-
sioner’s findings and recommendations. It is a trial de novo—a new trial—in the Federal Court.
In numerous cases, the Federal Court has disagreed with the privacy commissioner’s assess-
ment of the issues. One such case is described in Box 26.2. Another is Turner v. Telus Communi-
cations Inc.,17 which dealt with the difficulties of applying the above-noted consent requirement
in a unique workplace context. In Turner, a small group of employees refused to consent to the
employer’s collection of their voice prints for use in a voice-recognition security system. The
employer’s purpose for collecting the information (security, efficiency, and cost effectiveness) was
found by the privacy commissioner to be reasonable in the circumstances and, therefore, the em-
ployer did not need the consent of the employees in question. The Federal Court of Appeal, while
agreeing that the employer was acting reasonably and even laudably, found that the employees
nevertheless had the right under PIPEDA to refuse consent even if their refusal was objectively
unreasonable or motivated by an improper purpose. Ultimately, the employer could not bypass
the consent requirement to compel the employees to provide their voice prints. The Federal Court
of Appeal suggested that the employer could take steps against holdout employees, such as reas-
signment or discipline, but that the question of whether such consequences would be an appropri-
ate exercise of management’s rights is a matter for labour law and is beyond the reach of PIPEDA.

Video Surveillance of the Workplace Under PIPEDA
Eastmond v. Canadian Pacific Railway ronto rail yard in response to theft and vandalism in the yard.
2004 FC 852 The privacy commissioner found that the security benefit to
the employer was outweighed by the intrusion into employ-
Key Facts: Canadian Pacific Railway (the employer) installed ees’ privacy because (1) there was an absence of statistics to
surveillance cameras in the mechanical facility area of its To- show a demonstrable need for the cameras, and (2) the cam-

eras could have an adverse psychological effect on employees deleted after 96 hours and was only reviewed if a security in-
who felt that being filmed while working in the Toronto yard cident was reported. The Federal Court found that the security
was an invasion of privacy. When the employer persisted with and deterrence purposes of the employer outweighed the
the cameras, the employees requested a hearing before the relatively minor privacy interests of employees whose images
Federal Court. might be recorded while working in the rail yard.
In addition, the employees’ consent was not required to
Issue: Was the installation of video surveillance cameras ac- record their images because the exception for personal infor-
ceptable under PIPEDA because a “reasonable person” would mation “collection without knowledge or consent” in section
consider the cameras appropriate in the circumstances due to 7(1)(b) of PIPEDA applied. That section eliminates the need for
concerns over theft and vandalism? an employer to seek consent when doing so “would comprom-
ise the availability or the accuracy of the information and the
Decision: Yes. The Federal Court disagreed with the privacy collection is reasonable for purposes related to investigating
commissioner, finding that a reasonable person would con- a breach of an agreement or a contravention of the laws of
sider the use of the cameras to be appropriate in the circum- Canada.” Since the video was intended to record theft or van-
stances. The Federal Court based its decision on the fact that dalism, a requirement to obtain the consent of the people
the cameras were not surreptitious and the collection of per- being watched would compromise the purpose of the
sonal information was not continuous. The video footage was recording.
Recently, the federal government amended PIPEDA to remove the requirement to obtain
consent for the collection, use, or disclosure of personal information “necessary to establish,
manage or terminate an employment relationship” and information “produced by the individual
in the course of their employment, business or profession.”18 In its submission to the Senate
Standing Committee on Transport and Communications with respect to these amendments, the
Office of the Privacy Commissioner of Canada recognized the challenge of obtaining meaning-
ful consent in a workplace environment given the unequal bargaining power of employers and
employees. It also noted that removing the requirement to obtain consent would be sensible
given that several other important protections under PIPEDA (i.e., ones limiting the collection,
use, and disclosure of information) would continue to apply.19 The passage of these amendments
effectively resolves the challenge of obtaining consent from employees in circumstances like
those raised in Turner v. Telus Communications Inc. In the future, the analysis of a federally regu-
lated employer’s request for personal information will be focused on the “reasonableness” of the
request.
The PIPEDA amendments applicable to employment bring the federal sector in line with
Alberta and British Columbia, where information privacy laws have specific provisions permit-
ting employers to collect personal information from employees without their consent as long as
the collection is reasonable and employees have prior notice. For example, section 15(1) of
Alberta’s Personal Information Protection Act states:
15(1) An organization may collect personal employee information about an individual without
the consent of the individual if
(a) the information is collected solely for the purposes of
(i) establishing, managing or terminating an employment or volunteer-work relationship, or
(ii) managing a post-employment or post-volunteer-work relationship,
between the organization and the individual,
(b) it is reasonable to collect the information for the particular purpose for which it is being
collected, and
(c) in the case of an individual who is a current employee of the organization, the organization
has, before collecting the information, provided the individual with reasonable notification that
personal employee information about the individual is going to be collected and of the purposes
for which the information is going to be collected.20


What Kinds of Privacy Are Protected in the Workplace?
Four different types of privacy interests have been recognized three privacy interests) that is irrelevant to the proper
in Canadian law as worthy of protection in the workplace administration of the employment relationship
context:
A workplace policy or practice could intrude upon several
1. Corporeal privacy: the bodily integrity of an employee, of these privacy interests at the same time. For example, work-
including bodily fluids and images captured by photo- place drug testing impacts corporeal privacy (since an em-
graphs and video cameras ployee must provide a bodily fluid for the test), temporal
2. Territorial privacy: places inside or outside the work- privacy (since the testing could relate to the use of substances
place that are considered private, such as washrooms, during off-duty hours), and informational privacy (since the
change rooms, lockers, and the home results of the testing could provide information about an
3. Temporal privacy: off-duty hours (including breaks) employee’s use of drugs and even suggest that the employee
when an employee is entitled to be free of intrusions is disabled by reason of drug addiction).
4. Informational privacy: information about an employee
(often collected through an intrusion upon the first
While such provisions may seem at first glance to be less protective of employee privacy
because they permit information collection without consent, an approach to workplace privacy
based on an overall reasonableness assessment could provide a better framework to balance
competing employer and employee interests. This approach is also more consistent with the
balancing approach to human rights generally in Canada, as exemplified by section 1 of the
Canadian Charter of Rights and Freedoms.
C. Human Rights Statutes and Privacy

As discussed in Chapter 22, every jurisdiction in Canada has human rights legislation that pro-
tects individuals from discrimination in employment on the basis of prohibited grounds such
as race, sex, and disability.21 While the courts and labour arbitrators (in the unionized setting)
can take jurisdiction over human rights issues (e.g., in wrongful dismissal litigation or in griev-
ance arbitrations), each jurisdiction’s human rights tribunal has the authority to adjudicate
complaints of employer discrimination from both employees and job applicants. Although pri-
vacy is not directly protected by human rights statutes, these laws can offer important indirect
protection of individual privacy interests.
A number of privacy-related issues implicate an employer’s obligations under human rights
legislation. For example, the collection of private information (e.g., an employee’s marital status,
religion, or sexual orientation) by an employer or a potential employer may reveal facts about
an individual that relate to prohibited grounds of discrimination. Insofar as an employer relies
on this information in its decision making, it risks running afoul of human rights legislation.
And as discussed in Chapter 22, human rights legislation prohibits employers from soliciting
from employees and job applicants some information pertaining to prohibited grounds. For
example, in Thompson v. Selective Personnel, the Ontario Human Rights Tribunal ordered an
employer to pay a job applicant $3,000 as damages for illegally asking the applicant if she had
ever received psychiatric care.22
Sometimes human rights legislation permits (or may require) employers to request informa-
tion from employees or job applicants about prohibited grounds, but it also imposes restrictions
on what the employer can do with that information. For example, as we discussed in Chapter
23, employers have a duty to accommodate an employee with a disability up to the point of
undue hardship.23 This duty imposes obligations on both the employer and employee to partici-
pate in an accommodation process, which extends to the sharing of information about the dis-

ability to facilitate an appropriate accommodation. An employer is entitled to request such

medical information as is necessary for it to fulfill its duty to accommodate. Recall as well our
discussion of drug and alcohol testing under human rights law from Chapter 23 (and the case
of Entrop v. Imperial Oil Limited). By finding that human rights legislation restricts the right of
employers to mandate employees to submit to drug and alcohol testing, the courts have effect-
ively protected employees’ privacy interests.
Individuals have significant privacy interests in the protection of their bodily integrity and in
the medical information that could be gleaned from an analysis of their bodily fluids, such as
blood or urine. If privacy itself were to be characterized and protected as a human right in
Canada, then an employer would likely be prohibited from collecting such private information
about an individual, particularly if it would involve invading the individual’s body or a private
space, such as the individual’s home. Currently, human rights legislation in Canada prevents
employers from discriminating against an employee or applicant on the basis of information
that has been obtained relating to a prohibited ground and, as demonstrated in Entrop, may in-
directly provide protection of individual privacy in some circumstances by discouraging or
prohibiting employers from collecting such information in the first place.
III. The Common Law and Privacy at Work

Until recently, as noted earlier, the common law had very little to say about privacy at work.
When we considered common law torts in Chapter 16, we left out any discussion of privacy.
However, a limited common law right to privacy has emerged in recent jurisprudence.
A. Tort Law

In the landmark 2012 case of Jones v. Tsige (see Box 26.4), the Ontario Court of Appeal held that
individuals should be permitted to sue others at common law for wrongfully invading their pri-
vacy. The court called this new tort “intrusion upon seclusion.”24 Prior to Jones, persons whose
privacy had been invaded by a private actor had no formal recourse in Canadian tort law.25

A New Tort of Intrusion upon Seclusion
Jones v. Tsige Decision: The court’s decision addressed the three questions in
2012 ONCA 32 turn:
Key Facts: The plaintiff (Jones) and the defendant (Tsige) did not 1. The court recognized a new common law tort for breach of
know each other personally but worked at different locations of the privacy and called it a right of action for “intrusion upon se-
same bank. Tsige, who was in a common law relationship with the clusion.” In its analysis and consideration of the right to pri-
plaintiff’s former husband, reviewed Jones’s banking records at least vacy, the court found that Charter jurisprudence afforded
174 times over a four-year period. Tsige claimed that she accessed constitutional protection to the right to privacy and charac-
Jones’s banking records to determine whether her partner, Jones’s terized privacy as a Charter value.† In general, the Supreme
former husband, was paying child support. Tsige was disciplined by Court of Canada has acted to develop the common law in a
the bank for having accessed the records without a legitimate rea- manner consistent with Charter values, even though the
son. Significantly, the bank was not named as a defendant in the Charter does not apply to disputes between private parties.
lawsuit.* The court noted that the recognition of a right to privacy as
underlying specific rights under the Charter in combination
Issues: (1) Should the court recognize a new tort for breach of pri- with the principle that the common law should be de-
vacy? (2) If yes, what are the elements of the tort? (3) What remedies veloped in a manner consistent with Charter values pro-
should be available? vides support for the recognition of a civil action for

damages for invasion of privacy.‡ As a further justifica- of intrusion upon seclusion. The maximum amount
tion for recognizing the new tort, the court also noted available is $20,000. To provide an indication of how
the threat to privacy posed by rapid technological the damages are applied, in this case Jones experi-
change. enced an invasion of her privacy that the court charac-
2. To establish the tort of “intrusion upon seclusion” a terized as “highly offensive” and “shocking” and was
plaintiff must demonstrate the following three awarded $10,000.
elements:
* It is likely that the bank was not named in the lawsuit because the
(a) the conduct was intentional (this includes situa- plaintiff determined that vicarious liability would not apply to the bank
tions in which the plaintiff demonstrates that the in the circumstances of this case, potentially because the bank had
defendant was reckless); disciplined the defendant for her conduct.
(b) an invasion took place into the plaintiff’s private af- † Jones v. Tsige at para 43, quoting Hill v. Church of Scientology of Toronto,
fairs or concerns without lawful justification; and [1995] 2 SCR 1130 at para 121; and R v. O’Connor, [1995] 4 SCR 411 at
para 113.
(c) the invasion was highly offensive, such that it
would have caused distress, humiliation, or anguish ‡ The decision cites J.D.R. Craig, “Invasion of Privacy and Charter Values:
The Common Law Tort Awakens” (1997) 42 McGill LJ 355.
to a reasonable person.
3. The court established a cap on general damages avail-

able to individuals who successfully establish the tort
The Jones case represents a significant legal development for individuals who have had their
privacy invaded. In the workplace context, the new tort is available to non-unionized private
sector employees whose employers are provincially regulated and are not already subject to pri-
vacy legislation. However, restrictions placed by the court on the application of the tort will
likely limit its application. For example, the tort is only available when a deliberate and signifi-
cant invasion of privacy has taken place that would be “highly offensive” to a reasonable
person.26 This means that a person who is overly sensitive or unreasonably concerned about
their privacy will fail to meet the elements of the tort.
The court also noted that the right to privacy may have to be balanced against competing
claims or interests, such as freedom of expression and freedom of the press.27 The right to pri-
vacy, while important, may not always trump a competing interest. In cases where a competing
interest is alleged to justify an invasion of privacy, the court will engage in a “reasonableness”
analysis that will balance the interests in the situation. Finally, the court limited the amount of
general damages available for intrusion upon seclusion to $20,000. Since privacy interests are
intangible—that is, they have no obvious monetary value—the damages for the tort will be mod-
est unless the plaintiff can demonstrate an actual monetary loss.28 Significantly, while the court
in Jones acknowledged that the defendant’s conduct was “highly offensive” and “shocking,” the
plaintiff was only entitled to $10,000 in general damages. Given that the tort is still relatively new
and not many cases exist to provide guidance on the quantum of damages, it is difficult to esti-
mate how a court will award damages in a particular case. The court’s cap on damages discour-
ages plaintiffs from commencing litigation over trivial invasions of privacy given that the
likelihood of a monetary windfall is low, but it may also discourage plaintiffs from commencing
litigation over meritorious cases given the costs—both financial and otherwise—of litigation.
Notably, there appears to be considerable potential for new causes of action to be recognized
based on the common law protection of privacy. In Doe 464533 v. N.D, the plaintiff ’s ex-boyfriend
allegedly shared sexually explicit images of her on a pornographic website. The court found this
to be tortious, recognizing a new aspect of the privacy tort, “public disclosure of private facts”:
One who gives publicity to a matter concerning the private life of another is subject to liability to the
other for invasion of the other’s privacy, if the matter publicized or the act of the publication (a) would
be highly offensive to a reasonable person, and (b) is not of legitimate concern to the public.29

The 2018 decision of the Ontario Superior Court, Jane Doe 72511 v. Morgan similarly con-
cerned the unauthorized posting of sexually implicit images of the plaintiff on a pornographic
website. The court essentially restated the test from the previous Jane Doe case, finding that the
plaintiff had to prove that:
(a) the defendant publicized an aspect of the plaintiff ’s private life;

(b) the plaintiff did not consent to the publication;
(c) the matter publicized or its publication would be highly offensive to a reasonable
person; and
(d) the publication was not of legitimate concern to the public.30
Given the severity of the particular privacy invasion at issue, the court determined that the
$20,000 compensation limit from Jones would not apply. Instead, the court awarded the plaintiff
$50,000 in general damages, $25,000 in aggravated damages, and $25,000 in punitive damages.
A class action could provide non-unionized, private sector employees in Ontario with a cost-
effective approach to enforcing their privacy rights in some circumstances. Where the privacy
of numerous individuals has been intruded upon in a similar manner, those individuals could
attempt to have the court certify a lawsuit as a class action.31 A class action is less expensive and
more efficient overall than individual lawsuits. The Ontario Superior Court of Justice recently
certified a class action that in part claimed damages for a breach of the plaintiffs’ privacy rights
through the tort of intrusion upon seclusion.32 This case, which addresses the potential vicarious
liability of an employer for an employee’s breach of customers’ privacy, demonstrates that the
class action could be used to assert workplace privacy rights. It is possible that in the future we
will see class actions certified in cases where an employer has collected or accessed information
from all or a number of its employees in a manner that allegedly violates their common law right
to privacy.
B. Contract Law

A right to privacy in employment may also exist, indirectly, in contract law. In Colwell v. Cor-
nerstone Properties Inc., the employer secretly installed a video camera in the office of a man-
ager.33 When the employee learned of the camera several months later, she was informed by the
employer that it was installed to detect thefts by other employees. The employee did not believe
that explanation and felt her personal privacy had been violated. She sought medical assistance
for stress and was prescribed sedative drugs. One month after learning of the camera, she quit
and sued for constructive dismissal. As we learned in Chapter 13, a constructive dismissal
involves a fundamental breach of the employment contract by the employer that the employee
treats as having terminated the contract. The court noted that Ontario does not have privacy
legislation, and that a general tort of invasion of privacy did not exist. Therefore, “employment
law” in relation to privacy must “be directed at contract rather than tort.”34 In the Colwell case,
the court ruled that the installation of the camera violated “an implied term at the time the
contract was entered into, that each party would treat the other in good faith and fairly, through-
out the existence of the contract.”35 Secretly installing a camera in the employee’s office violated
that term and amounted to a constructive dismissal. The employee was awarded damages based
on seven months’ notice.
class action: A lawsuit in which a group of people join together and act as one common plaintiff on the basis that they all
allege to have suffered the identical or a similar legal wrong at the hands of the same defendant. A class action must be ap-
proved by a court before it can proceed.
constructive dismissal: A fundamental change to an employment contract by an employer that an employee may treat as
an effective termination of the contract.

IV. Privacy in the Unionized Workplace

Part IV is concerned with the law of the unionized workplace. However, it makes sense to deal
with privacy in the unionized setting in this chapter on privacy at work. It is important to under-
stand that the legal protection of privacy differs between unionized and non-unionized employ-
ees, with the former enjoying generally stronger and better-developed privacy rights. In a
unionized workplace, a collective agreement governs the terms and conditions of employment
for the members of the bargaining unit. When a dispute arises between the employer and the
union concerning the interpretation or application of the collective agreement that the parties
cannot settle on their own, the dispute is often resolved by a labour arbitrator.
Disputes involving workplace privacy issues have often been raised by unions and dealt with
through labour arbitration hearings. In fact, hundreds of arbitration decisions have been made
on workplace privacy issues, such as the right of an employer to search employee lockers and
bags, engage in video surveillance of employees inside and outside the workplace, monitor em-
ployee computers, and require employees to take drug and alcohol tests. Usually, these decisions
have been concerned with the “reasonableness” of policies implemented unilaterally by the em-
ployer. We will learn in Part IV that, in the unionized setting, employers generally have the right
to manage the workplace as they deem fit, subject to three important provisos: (1) the employer
must act in accordance with the law; (2) the employer cannot violate the express collective
agreement terms; and (3) the employer must not implement rules or policies that are
“unreasonable.”
Many grievances that involve allegations of employer invasion of employee privacy challenge
the employer’s actions as being unreasonable.36 For example, arbitrators have struck down as
unreasonable many employer searches of employee property, including lunchboxes and cloth-
ing, unless evidence exists that justifies a real suspicion of theft.37 Video surveillance at a union-
ized workplace has been struck down as unreasonable unless the employer can demonstrate a
legitimate business reason for the surveillance (e.g., a serious theft problem), that the surveil-
lance was carried out in a reasonable and non-discriminatory manner, and that no other less-
intrusive options that do not impinge as greatly on employee privacy were available to deal with
the problem.38 Arbitrators have also held that a requirement for employees to provide finger-
prints—such as in the case of security checks39 and for use in payroll and timekeeping sys-
tems40—is an unreasonable invasion of employee privacy. It is likely that future advances in
technology that make biometric identification methods such as facial recognition, eye scanning,
and voice prints increasingly available and affordable will be the subject of union grievances.
A recent arbitration decision regarding a random alcohol- and drug-testing policy called
Communications, Energy and Paperworkers Union of Canada, Local 30 v. Irving Pulp & Paper,
Ltd. was appealed to the Supreme Court of Canada.41 The majority of the court discussed and
endorsed the arbitration board’s view that privacy is fundamentally important and that privacy-
invasive workplace policies may be unreasonable and invalid:
[49] On the other side of the balance was the employee right to privacy. The board accepted that
breathalyzer testing “effects a significant inroad” on privacy, involving
coercion and restriction on movement. Upon pain of significant punishment, the employee must
go promptly to the breathalyzer station and must co-operate in the provision of breath samples. …
Taking its results together, the scheme effects a loss of liberty and personal autonomy. These are
at the heart of the right to privacy.
[50] That conclusion is unassailable. Early in the life of the Canadian Charter of Rights and Free-
doms, this Court recognized that “the use of a person’s body without his consent to obtain informa-
tion about him, invades an area of personal privacy essential to the maintenance of his human

dignity” (R. v. Dyment, 1988 CanLII 10 (SCC), [1988] 2 SCR 417, at pp. 431-32). And in R. v. Shoker,
2006 SCC 44 (CanLII), [2006] 2 SCR 399, it notably drew no distinction between drug and alcohol
testing by urine, blood or breath sample, concluding that the “seizure of bodily samples is highly
intrusive and, as this Court has often reaffirmed, it is subject to stringent standards and safeguards
to meet constitutional requirements” (para. 23).
[51] In the end, the expected safety gains to the employer in this case were found by the board to
range “from uncertain … to minimal at best,” while the impact on employee privacy was found to
be much more severe. Consequently, the board concluded that the employer had not demonstrated
the requisite problems with dangerousness or increased safety concerns such as workplace alcohol
use that would justify universal random testing. Random alcohol testing was therefore held to be an
unreasonable exercise of management rights under the collective agreement. I agree.42
Significantly, however, although the Supreme Court recognized the importance of individual
privacy at work, it nevertheless characterized privacy as a matter that can be subject to negotia-
tion between the employer and the union, as the representative of the employees:
Moreover, the employer is not only always free to negotiate drug and alcohol testing policies with
the union, as was said in Nanticoke, “such an extraordinary incursion into the rights of employees
must be expressly and clearly negotiated” (para. 101 (emphasis added)). But where, as here, the em-
ployer proceeds unilaterally without negotiating with the union, it must comply with the time-
honoured requirement of showing reasonable cause before subjecting employees to potential
disciplinary consequences. Given the arbitral consensus, an employer would be justifiably pessimistic
that a policy unilaterally imposing random alcohol testing in the absence of reasonable cause would
survive arbitral scrutiny.43
The result in this case demonstrates that unionized employees may have stronger privacy
protections than non-unionized employees because the employer must act reasonably (and
invading privacy would be unreasonable in many cases). However, it is notable that even the
privacy of unionized employees may be negotiated away by their union.
V. Recent Case Law Related to Privacy and “Reasonableness”

From the foregoing, we can see that the concept of “reasonableness” is central to the analysis of
privacy rights under provincial privacy acts, information privacy laws like PIPEDA, the com-
mon law privacy tort, and collective agreements. The recent decision of the Supreme Court in
R v. Jarvis is therefore notable.44 There, the court interpreted the meaning of “reasonable expect-
ation of privacy” in the context of a criminal provision (voyeurism), but set down general prin-
ciples that may be influential in assessing the reasonableness of an alleged privacy invasion in
different contexts, including in the workplace. In particular, the court provided the following
non-exhaustive list of considerations that may assist an adjudicator in determining whether the
subject of an alleged privacy violation was in circumstances that give rise to a reasonable expect-
ation of privacy:
(1) The nature of the location where the alleged privacy violation occurred;
(2) The nature of the impugned conduct (for example, recording a person is more intrusive
on privacy than mere observation);
(3) Whether the subject was aware of, or consented to, the impugned conduct;
(4) The manner in which the alleged privacy invasion occurred (for example, was tech-
nology involved and, if so, what technology?);
(5) The subject matter or content of the alleged privacy violation;
(6) Any rules, regulations, or policies that governed the observation or recording in
question;
(7) The relationship between the subject and the person who allegedly violated the subject’s
privacy;

(8) The purpose underlying the alleged privacy violation; and

(9) The personal attributes of the subject (for example, was the subject a child or otherwise
vulnerable?).
In future cases, adjudicators can be expected to look at these considerations in assessing
whether privacy has been violated in a particular circumstance.
VI. Chapter Summary

The laws regulating workplace privacy attempt to strike a reasonable balance between the pri-
vacy rights of employees (including the right to be free from surveillance and searches and
disclosure of private information) and the legitimate business interests of the employer (includ-
ing improving efficiency and safety and preventing theft and vandalism). This chapter has dem-
onstrated that Canadian law regulates privacy through a complicated mix of statutory and
common law rules. As a result, the manner in which the law strikes a balance between employee
and employer interests can vary from workplace to workplace and jurisdiction to jurisdiction.
Privacy law is an evolving legal field, and there is no doubt that advancements in technology will
pose challenges for this area of law.

1. Briefly explain the various legal sources of employee privacy protection in Canada.
2. What types of privacy interests are protected by the legal sources of employee privacy
protection in Canada?
3. Do you agree with the decision of the privacy commissioner or the decision of the Federal
Court in Eastmond v. Canadian Pacific Railway (see Box 26.2)? Briefly explain your
reasoning.
4. Is the tort of intrusion upon seclusion an effective deterrent for an employer considering
the implementation of measures or technology that potentially impact employees’ privacy
interests? Briefly explain your reasoning.
5. Should unionized and non-unionized employees enjoy the same privacy protection?
Briefly explain your reasoning.
APPLYING THE LAW

Victor works in an entry-level position at ABC Co., which oper- Victor learned that the second account was linked to ABC
ates in Ontario and British Columbia, is provincially regulated, Co.’s compliance department, which was investigating him for
and is non-unionized. insider trading at the instruction of the head of the compliance
Aside from his day job, Victor is also active on a popular department. ABC Co. provided Victor with a copy of a redacted
social networking site, Outstagram, where he shares numerous whistleblower report, which contained bald and unparticular-
photos and videos of himself on a daily basis with his 3,000 ized allegations accusing Victor of insider trading. Aside from
followers. Shortly after starting employment at ABC Co., Vic- the whistleblower report, there was no other basis for ABC Co.
tor’s manager asked him for his personal phone number and to investigate Victor. Ultimately, it was determined that Victor
told him to download a specific app to his phone, explaining had not engaged in any insider trading.
that this was required so that the company could easily contact 1. Assuming that Victor and his manager both reside in
him in an emergency. the province of Ontario, can Victor successfully bring a
During the next few months, Victor noticed his phone civil action against his manager? If so, what is the likely
operating much slower than usual and brought it to an expert outcome? Can Victor successfully bring a civil action
to be repaired. Upon investigation, Victor was informed that against ABC Co. regarding his manager’s conduct?
data from his phone was being downloaded by two other 2. Assuming that Victor resides in the province of British
accounts through the special app installed on his phone. One Columbia and is currently working in ABC Co.’s branch
of the accounts, which was only downloading Victor’s photos in British Columbia, can Victor successfully bring a civil
from his phone, was traced to his manager. Victor reported action against ABC Co.? If so, what is the likely
this to ABC Co., which fired his manager for cause. outcome?


1. Jones v. Tsige, 2012 ONCA 32. 19. Office of the Privacy Commissioner of Canada, “Bill S-4,
2. See British Columbia’s Privacy Act, RSBC 1996, c. 373; An Act to amend the Personal Information Protection and
Saskatchewan’s Privacy Act, RSS 1978, c. P-24; Manitoba’s Electronic Documents Act and to make a consequential
Privacy Act, CCSM c. P-125; and Newfoundland and Lab- amendment to another Act: Submission to the Senate
rador’s Privacy Act, RSNL 1990, c. P-22. Quebec has also Standing Committee on Transport and Communications”
included privacy as an offence against the law in the Civil (2014), online: <https://www.priv.gc.ca/en/opc-actions
Code of Québec, CQLR c. C-1991. -and-decisions/advice-to-parliament/2014/
parl_sub_140604_sen/>.
3. On the common law’s recognition (or lack thereof) of a
tort of privacy, see the discussion in Jones v. Tsige, supra 20. Alberta’s Personal Information Protection Act, supra note 9,
note 1 at para 15; and Ontario (Attorney General) v. Diele- s. 15(1).
man, 1994 CanLII 7509 (Ont. Sup Ct J). 21. See, for example, Ontario’s Human Rights Code, RSO 1990,
4. BC’s Privacy Act, supra note 2, s. 1. c. H.19, s. 5.
5. Richardson v. Davis Wire Industries Ltd., 1997 CanLII 4221 22. Thompson v. Selective Personnel, 2009 HRTO 1224. See also
(BCSC). Alberta Human Rights Act, RSA 2000, c. A-25.5, s. 8(1) as
an example of a statutory prohibition on employers solicit-
ing personal information related to prohibited grounds
7. Personal Information Protection and Electronic Documents from job applicants.
Act, SC 2000, c. 5 (“PIPEDA”).
23. Ontario’s Human Rights Code, supra note 21, s. 17.
8. Ibid., s. 4(1)(b).
24. Jones v. Tsige, supra note 1.
9. See Alberta’s Personal Information Protection Act, SA 2003,
25. A number of prior Ontario cases regarding workplace
c. P-6.5; British Columbia’s Personal Information Protection
privacy disputes suggested that a common law privacy tort
Act, SBC 2003, c. 63; and Quebec’s An Act Respecting the
could be available: Somwar v. McDonald’s Restaurants of
Protection of Personal Information in the Private Sector,
Canada Ltd., 2006 CanLII 202 (Ont. Sup Ct J); and Shred-
CQLR c. P-39.1.
Tech Corp. v. Viveen, 2006 CanLII 41004 (Ont. Sup Ct J).
10. PIPEDA, supra note 7, s. 5(3).
26. Jones v. Tsige, supra note 1 at para 72.
11. Ibid., s. 7(1).
12. Ibid., s. 5(1) and Schedule 1.
28. Ibid. at para 71. In McIntosh v. Legal Aid Ontario, 2014
13. Ibid., s. 11. Unionized employees in federally regulated ONSC 6136, a plaintiff was found to be entitled to $7,500
workplaces can assert PIPEDA claims to arbitrators under in general damages after the defendant (an employee of
the applicable collective agreement grievance process. Legal Aid Ontario) improperly accessed the plaintiff ’s legal
14. Ibid., s. 12. aid file in a situation involving domestic issues. The de-
15. Ibid., s. 12.1. fendant improperly used the information from the legal
aid file to make a complaint to the Children’s Aid Society.
16. Ibid., s. 13.
29. Doe 464533 v. N.D., 2016 ONSC 541 at para 46.
17. Turner v. Telus Communications Inc., 2005 FC 1601;
appealed to the Federal Court of Appeal in Wansink v. 30. Jane Doe 72511 v. Morgan, 2018 ONSC 6607.
Telus Communications Inc., 2007 FCA 21. 31. A class action must be “certified” by the court before it can
18. Bill S-4, An Act to amend the Personal Information Protec- proceed. The requirements that must be met to achieve
tion and Electronic Documents Act and to make a conse- certification are outlined in the Class Proceedings Act,
quential amendment to another Act, SC 2015, c. 32 (also 1992, SO 1992, c. 6.
referred to as the Digital Privacy Act) was passed into law 32. Evans v. The Bank of Nova Scotia, 2014 ONSC 2135.
on June 18, 2015. Bill S-4 also contains two other employ- 33. Colwell v. Cornerstone Properties Inc., 2008 CanLII 66139
ment-related amendments: (1) the clarification that (Ont. Sup Ct J).
PIPEDA applies to the personal information of an appli-
34. It is important to note that this case was decided prior to
cant for employment with a federally regulated employer
the finding of the Ontario Court of Appeal in Jones v. Tsige,
and (2) that PIPEDA does not apply to business contact
supra note 1, which founded the tort of intrusion upon
information when it is used solely for the purpose of com-
seclusion (see Box 26.4).
municating or facilitating communication with the indi-
vidual in relation to their employment, business, or 35. Ibid.
profession. The Office of the Privacy Commissioner sup- 36. The “reasonableness” requirement has its roots in the
ported these amendments. seminal arbitration decision KVP Co. Ltd and Lumber &

Sawmill Workers’ Union, Local 2537 (1965), 16 LAC 73 employees’ right to privacy trumped the employer’s need
(Robinson), which we will consider in Part IV. for reliable employees to handle mail, particularly in the
37. See the discussion in M. Mitchnick & B. Etherington, absence of a specific power in the collective agreement to
Labour Arbitration in Canada (Toronto, ON: Lancaster demand fingerprints and in circumstances where the em-
House, 2006) at 215-16; Lornex Mining Corp. and USWA, ployer could have made the provision of fingerprints a
Local 7619 (1983), 14 LAC (3d) 169 (Chertkow); and condition of hiring before the collective agreement applied
B. Bilson, “Search and Surveillance in the Workplace: to the individual employee.
An Arbitrator’s Perspective” in W. Kaplan, J. Sack, & 40. IKO Industries Ltd. (2005), 140 LAC (4th) 393 (Tims); aff ’d
M. Gunderson, eds, Labour Arbitration Yearbook (Toronto, 155 LAC (4th) 225 (Ont. Sup Ct J (Div Ct)).
ON: Lancaster House, 1992). 41. Communications, Energy and Paperworkers Union of
38. St. Mary’s Hospital (New Westminster) and HEU (1997), 64 Canada, Local 30 v. Irving Pulp & Paper, Ltd., 2013 SCC 34.
LAC (4th) 382 (Larson); Lenworth Metal Products Ltd. and 42. Ibid. at paras 49-51.
USWA, Local 3950 (1999), 80 LAC (4th) 426 (Armstrong);
and Securicor Cash Services and Teamsters, Local 419, 2004
CanLII 55078 (Ont. LA) (Whitaker). 44. R v. Jarvis, 2019 SCC 10.
39. Canada Post Corp. v. CUPW (1988), 34 LAC (3d) 392
(Bird). In this decision, the arbitrator found that the


CHAP TER 27
Globalization and the Law of

Work: International Labour
Law and Trade Law
II. International Labour Law and the ILO 440
• Describe the origins and guiding philosophy of the International
A. The Guiding Philosophy of the ILO 440
Labour Organization.
B. “Labour Is Not a Commodity” 441
• Explain the meaning and significance of the phrase “labour is not C. What Does the ILO Do? 442
a commodity.” III. Trade Law 444
• Describe how the legal rules developed by the International A. Direct Effects of Trade Agreements on Canadian Work Law 445
Labour Organization have influenced Canadian law. B. Indirect Effects of Trade Agreements on Canadian Work Law 448
• Identify trade agreements signed by Canada that include labour IV. Chapter Summary 451
cooperation agreements. Questions and Issues for Discussion 451
• Explain how trade laws can have both direct and indirect effects Exercises 452
on Canadian work law. Notes and References 452
• Explain the meaning of “economic globalization” and discuss how
it affects Canadian work law.
I. Introduction
In this final chapter of Part III of the text, we step back and consider how Canada’s activities in
the global community can influence the form and substance of Canadian laws governing work.
We are concerned with two types of supranational laws: (1) international labour laws and
(2) trade laws. As an active member country of the International Labour Organization (ILO),
Canada has helped shape the development of internationally recognized core labour standards.
By its participation at the ILO and its ratification of ILO Conventions, Canada has publicly
promised to enact a set of work law standards. Some of the laws we have considered in the regu-
latory standards part of the text were originally enacted to comply with ILO obligations.
The effect of Canada’s participation in global and regional trade agreements on our work laws
is less obvious. None of the trade agreements to which Canada is a party include substantive
obligations requiring Canada to enact (or repeal) specific work laws. However, trade agreements
can nevertheless influence labour policy in Canada by shaping policy debates. In particular, by
dismantling trade barriers, trade agreements make it more economically feasible for businesses
to move from one jurisdiction to another in search of the most “business friendly” environments.
supranational law: Laws that transcend national borders and have application in more than one nation.
439

This dynamic puts pressure on Canadian work laws and arms those political forces that would
prefer Canada’s work laws to be weaker. In this way, trade agreements have had an important
indirect effect on the trajectory of Canadian work law and policy debates.
The effects of international law and trade laws (which are part of the broader legal subsystem)
on the development of Canadian work laws provide a clear example of the external feedback
loop explained in Chapter 2—these laws indirectly influence the substance and form of the laws
that govern work in Canada in ways described in this chapter.
II. International Labour Law and the ILO

Canada is a member country of the ILO, which is based in Geneva, Switzerland. The ILO is the
central global institution responsible for promoting decent work laws around the world.1 It was
formed in 1919 in the wake of World War I, and Canada has been deeply involved in the organ-
ization from the start.
A. The Guiding Philosophy of the ILO

The preamble to the ILO’s founding constitution, which formed part of the Treaty of Versailles,
explains the guiding philosophy of the organization:
And whereas conditions of labour exist involving such

injustice, hardship and privation to large numbers of
people as to produce unrest so great that the peace and
harmony of the world are imperilled; and an improve-
ment of those conditions is urgently required: as, for ex-
ample, by the regulation of the hours of work, including
the establishment of a maximum working day and week,
the regulation of labour supply, the prevention of unem-
ployment, the provision of an adequate living wage, the
protection of the worker against sickness, disease and
injury arising out of his employment, the protection of
children, young persons and women, provision for old
age and injury, protection of the interests of workers when
employed in countries other than their own, recognition
of the principle of freedom of association, the organiza-
ILO headquarters in Geneva.
tion of vocational and technical education and other
measures;
Whereas also the failure of any nation to adopt humane conditions of labour is an obstacle in the
way of other nations which desire to improve the conditions in their own countries;
The High Contracting Parties, moved by sentiments of justice and humanity as well as by the
desire to secure the permanent peace of the world, agree to the following: … .2
Several important points leap out from this preamble. First, the dominant theme is that
decent working conditions are necessary to achieve justice, peace, and world harmony. Second,
“regulation” is necessary to achieve decent working conditions; most of the areas in need of
regulation appearing in the first paragraph have been covered in this text. And third, as indi-
cated in paragraph two, the drafters believed that basic supranational labour standards are ne-
cessary to prevent a global race to the bottom in work laws. If one country could attract
businesses by promising very weak or non-existent labour standards, and therefore very low
labour costs, then this would create an obstacle for all other countries that wish to maintain
decent working conditions.

Chapter 27 Globalization and the Law of Work: International Labour Law and Trade Law 441
These core ideas were “reaffirmed” by the ILO in the wake of the atrocities of World War II.
In 1944, the ILO adopted the Declaration of Philadelphia, now incorporated into the ILO Con-
stitution.3 That document opened with the following statement of principles:
The Conference reaffirms the fundamental principles on which the Organization is based and, in
particular, that:
(a) labour is not a commodity;
(b) freedom of expression and of association are essential to sustained progress;
(c) poverty anywhere constitutes a danger to prosperity everywhere;
(d) the war against want requires to be carried on with unrelenting vigour within each nation,
and by continuous and concerted international effort in which the representatives of workers and
employers, enjoying equal status with those of governments, join with them in free discussion
and democratic decision with a view to the promotion of the common welfare.
These are powerful claims that elevate labour rights to fundamental importance, and the ILO
has remained an important global defender and promoter of strong work laws to this day.
B. “Labour Is Not a Commodity”

The deceptively simple phrase “labour is not a commodity,” found in the ILO Constitution, has
served as the rallying cry for generations of advocates for stronger work laws and collective
bargaining rights throughout the world.4 It signals the powerful idea that workers, as human
beings, are fundamentally different from other factors of production (such as office supplies and
electricity) and that the law should recognize this distinction. Professor David Beatty (Univer-
sity of Toronto) examined the meaning of this phrase in an important 1979 article entitled
“Labour Is Not a Commodity”:
[R]eflecting the characterization of humans as, for the most part, doers and makers, the identity
aspect of employment is increasingly seen to serve deep psychological needs. … It recognizes the
importance of providing the members of society with an opportunity to realize some sense of identity
and meaning, some sense of worth in the community beyond that which can be taken from the ma-
terial product of the institution. … [E]mployment is seen as providing recognition of the individual’s
being engaged in something worthwhile. … [E]mployment comes to represent the means by which
most members of our community can lay claim to an equal right of respect and of concern from
others. It is this institution through which most of us secure much of our self-respect and
self-esteem.5
This passage has been quoted by the Supreme Court of Canada in support of decisions that have
recognized a need for law to consider the social and psychological value of work, and not just
its economic function. For example, in Lavigne v. Ontario Public Service Employees Union
(which we will discuss in Part IV, the Supreme Court wrote:
In the past, this Court has not approached labour matters from an exclusively economic perspective.
For example, in Slaight Communications, supra, Dickson C.J. adopted the expression of Professor
David Beatty that “labour is not a commodity.” … The idea that is meant to be captured by this ex-
pression is, I think, that the interests of workers reach far beyond the adequacy of the financial deal
they may be able to strike with their employers. … [T]he Chief Justice made it clear that the interests
of labour do not end at some artificial boundary between the economic and the political. He
expressed the view that “[a] person’s employment is an essential component of his or her sense of
identity, self-worth and emotional well-being” … and that viewing labour as a commodity is in-
compatible with that perspective.6

The exercise at the end of this chapter encourages you to explore how the concept of “labour
is not a commodity” has influenced the development of Canadian work law.
The claim that labour is not a commodity clashes with core tenets of the neoclassical perspec-
tive. Recall from our discussion in Chapter 3 that neoclassical economics advocates that labour
is indeed a commodity that should be left to the supply and demand of market forces.7 As the
neoclassical perspective ascended in political discourse over the past 30 years, the ILO’s pursuit
of strong work laws and effective regulation of labour markets came under attack by neoclassi-
cal-influenced economists and politicians as well as powerful employer organizations. This
tension has played out most clearly within the ILO in a sustained attack by employers’ represent-
atives at the ILO against the expansive right to strike, long recognized in ILO law. Employers
have sought to pull back the scope of workers’ right to strike.8 In Canada, the tension between
Canadian labour policy and ILO policy is demonstrated in a series of findings by ILO super-
visory bodies that Canadian governments violated ILO doctrine by restricting collective bar-
gaining rights and the right to strike.9 We will explore this tension again in Part IV.
C. What Does the ILO Do?

Almost every country in the world is a member of the ILO; the organization has 187 member
countries in all. The machinery and institutions of the ILO are quite complex, but here we can
briefly describe the main points.10 A distinctive feature of the ILO, compared with other inter-
national governmental organizations, is its tripartite structure. Each member country sends
four delegates to participate in its annual International Labour Conference in Geneva, where
policies are discussed and debated and sometimes ILO Conventions and recommendations
are adopted. The delegates for Canada include two government representatives, one represent-
ative of Canadian employers (selected by the Canadian Employers Council), and one
representative of Canadian workers (selected by the Canadian Labour Congress, the umbrella
organization for Canada’s national and international unions).
By 2019, 190 Conventions had been adopted by the ILO, covering virtually every area of
employment and work-related subject matter.11 A Convention adopted by the ILO has no im-
mediate legal effect in Canada. Ratifying a Convention is like making a public promise: once
Canada ratifies a Convention, its governments are expected to enact domestic legislation that
gives effect to the principles stated in that Convention and to report to the ILO on progress
toward effective implementation. Our courts cannot directly enforce and apply ILO Conven-
tions to Canadian legal disputes. However, as explained in Box 27.1, ILO Conventions can influ-
ence how judges interpret Canadian laws. The federal government ratifies international
Conventions on behalf of Canada, but as we learned in Chapter 17, most of work law falls within
the jurisdiction of the provinces. Therefore, when Canada ratifies an ILO Convention, it must
rely on the provinces to introduce laws to make the Convention effective.12 Many of Canada’s
early statutes regulating working conditions mentioned earlier in this text were originally intro-
duced to give effect to ILO Conventions, including laws on maximum hours of work and gender
wage equality at work. As of 2019, Canada had ratified only 37 of the ILO’s 190 Conventions.13
ILO Convention: An international treaty adopted by the International Labour Organization that is subject to ratification by
member countries.
ILO recommendations: Non-binding guidelines introduced by the International Labour Organization that provide guidance
to member countries but are not subject to ratification.
ratify: A term used to describe the process in which a national government endorses and agrees to implement into its legal
system the requirements of an international legal convention or other legal instrument.


How ILO Conventions Influence the Development of Canadian Work Law
ILO Conventions, even if ratified by Canada, do not directly freedom of association. The Supreme Court ruled that they did,
change Canadian work laws. A Canadian worker cannot sue and in doing so, ruled that section 2(d) of the Charter should
their employer or their government for violating an ILO rule. be “presumed to provide at least as great a level of protection as
Ratification of an ILO instrument is like a public promise by a is found in the international human rights documents that Can-
government to enact domestic laws that will make effective ada has ratified.”* This pronouncement effectively made ILO
rules found in the ILO instrument. The ILO has no formal power Conventions, along with other international legal instruments,†
to order a country to ratify or implement one of its Conven- directly relevant to the development of Canadian work law.
tions. However, the ILO’s various bodies can write reports that The Supreme Court has, controversially, also relied directly on
publicly shame or embarrass governments for non-compli- Conventions that Canada has not ratified, including ILO Con-
ance. As noted at various points in this part of the text, many vention 98 before Canada had ratified it, which requires that
of Canada’s regulatory labour standards were first enacted in governments enact legislation to ensure that unions and
order to bring Canada into compliance with ratified ILO employers can engage in “voluntary negotiation” of collective
Conventions. agreements.‡ The Supreme Court’s reliance on ILO Conventions
ILO instruments can influence the development of Canad- has contributed directly to its recent decisions to recognize a
ian work law in another way. Canadian courts have sometimes constitutional right in Canada to collective bargaining§ and
referred to and been influenced by ILO Conventions and norms the right to strike# (as we will discuss in Part IV).
in their interpretation of Canadian laws and the Canadian * Health Services and Support—Facilities Subsector Bargaining Assn. v.
Charter of Rights and Freedoms, which we will consider in Chap- British Columbia, 2007 SCC 27 at para 70.
ter 39. † Ibid. at para 70.
For example, in the 2007 case of Health Services and Sup-
‡ See B. Langille, “The Freedom of Association Mess: How We Got into It
port—Facilities Subsector Bargaining Assn. v. British Columbia, and How We Can Get out of It” (2009) 54 McGill LJ 177; and R.J. Adams,
the Supreme Court of Canada considered whether the same “Prospects for Labour’s Right to Bargain Collectively After B.C. Health
BC laws found by the Committee of Freedom of Association to Services” (2009) 59 UNBLJ 85.
have violated ILO Convention 98 also violated the Canadian § Health Services and Support, supra note * at para 70.
Charter of Rights and Freedoms guarantee in section 2(d) of # Saskatchewan Federation of Labour v. Saskatchewan, 2015 SCC 4.
Member countries are required to submit an annual report to the ILO outlining the measures
that have been taken to implement a ratified Convention, and those reports are examined by a
special committee of the ILO known as the Committee of Experts on the Application of Con-
ventions and Recommendations.14 Complaints can be made to the Committee of Experts alleg-
ing that a country has failed to adhere to a ratified Convention.
Two Conventions were singled out by the ILO long ago for special treatment within the ILO’s
enforcement machinery on the basis that the rights and freedoms mentioned in them are fun-
damental to the mission of the ILO (and are included in the ILO Constitution):
• ILO Convention 87: Freedom of Association and Protection of the Right to Organise Con-
vention (1948), which deals with the rights of workers to organize unions without repri-
sals and to strike.15
• ILO Convention 98: Right to Organise and Collective Bargaining Convention (1949), which
deals with the rights of unions to exist independently of government.16
These Conventions deal with collective worker rights, including the rights to form and join
unions, engage in collective bargaining, and strike. Canada has ratified both Convention 87 (in
1972) and Convention 98 (in 2017). The ILO asserts that all member countries have an obliga-
tion to comply with these two Conventions, even if they have not ratified them, on the basis that
by becoming a member of the ILO a country agrees to abide by fundamental rights expressed
in the ILO’s Constitution, including freedom of association.17 A special expert body, known as
the Committee on Freedom of Association (CFA), was created in 1951 to hear complaints alleg-

ing violations of these two core Conventions.18 In recent years, the CFA has singled out Can-
adian governments for their persistent use of legislation that restricts workers’ rights to
collective bargaining and to strike. Since the 1980s, Canada has the notorious distinction of
having been found by the ILO’s supervisory bodies to have violated its citizens’ fundamental
rights to collective bargaining more frequently than any other ILO member country.19
In response to a 2003 complaint filed by Canadian unions about BC legislation that pro-
hibited strikes and imposed contract terms on unionized health workers, the CFA was highly
critical of the provincial government’s actions:
Recalling that the voluntary negotiation of collective agreements, and therefore the autonomy of
bargaining partners, is a fundamental aspect of freedom of association principles … and that the
right to strike is one of the essential means through which workers and their organizations may
promote and defend their economic and social interests, … the Committee regrets that the Govern-
ment felt compelled to resort to such measures and trusts that it will avoid doing so in the future …
The Committee also points out that repeated recourse to legislative restrictions on collective bargain-
ing can only, in the long term, prejudice and destabilize the labour relations climate.20
The CFA has no authority to order a government to do anything to remedy the violation of
an ILO Convention. Instead, the CFA makes “recommendations” for governments to comply
with in the future. However, being found in violation of a core ILO Convention may, in some
circumstances, shame a government and influence domestic debates over labour policy.
In 1998, the ILO adopted the ILO Declaration on Fundamental Principles and Rights at
Work.21 That document emphasizes a set of core labour standards that all member countries
are expected to “promote” and “realize.” The ILO identified eight Conventions that comprise
these core labour standards (Canada has ratified all eight, some only recently):
• Conventions 87 (ratified by Canada in 1972) and 98 (2017), which together protect free-
dom of association, including unionization, collective bargaining, and strikes.
• Conventions 29 (2011) and 105 (1959), which regulate the use of forced and compulsory
labour.
• Conventions 138 (2016) and 182 (2000), which regulate child labour.
• Conventions 100 (1972) and 111 (1964), which regulate gender pay discrimination and
job discrimination on the basis of race, colour, sex, religion, political opinion, national
extraction, or social origin.
All member countries are required to report on their efforts to realize these core Conven-
tions, whether or not they have ratified them. The ILO’s Conventions have had both direct and
indirect impacts on the development of Canadian work law since the early 20th century.
III. Trade Law

Trade laws regulate the manner by which goods and services flow across national borders. An
important part of the trade law arsenal is import duties, or tariffs. Canada, like other countries,
has a long history of imposing tariffs on goods and services entering the Canadian market from
abroad in order to both collect revenues and, more importantly, protect domestic companies
core labour standards: A set of eight ILO Conventions covering subjects considered to be critically important to the mission of
the ILO. These subjects include freedom of association, abolition of forced labour, abolition of child labour, and non-discrimination
in employment.
tariff: A fee or tax imposed on goods and services as a condition of their entering a country to be sold in that country’s markets.

from foreign competition.22 Protectionist trade laws allowed Canadian lawmakers to develop
a relatively robust work law system of collective bargaining and regulatory standards protections
with considerable confidence that many large manufacturers would remain in Canada in order
to bypass high tariffs.
For example, by imposing tariffs as high as 35 percent on cars imported into Canada from
the United States in the early 20th century, the Canadian government created an incentive for
American automakers to build car plants in Canada in order to bypass the tax and sell directly
to Canadian consumers. The Big Three car manufacturers of the time (Ford, General Motors,
and Chrysler) all invested in new production facilities in Canada, producing cars mostly for the
Canadian market. The 1965 Canada – US Automotive Products Agreement (Autopact) removed
tariffs on condition that production of cars in Canada remained at a specified high level. Ontario
cities like Oshawa and Windsor blossomed under the protection afforded by trade tariffs and
later by the Canadian content rules in the Autopact, confident that the American automakers
would continue to employ thousands of Canadian workers for the indefinite future.
Although these trade agreements did not directly deal with work laws, they represent an im-
portant part of the story of the development of that law in Canada, particularly the collective
bargaining law we will explore in Part IV. As the Canadian auto industry grew under the protec-
tion of tariffs and later the Autopact, American unions, including the United Auto Workers,
crossed the border and organized Canadian workers. Many of the historical battles we consider
in Part IV that led to important legal developments took place in the context of efforts by Can-
adian autoworkers (and workers in other industries protected by high tariffs, including steel) to
unionize and bargain collective agreements. Those events likely would not have occurred if not
for government trade policy designed to protect key manufacturing and resource industries.23
We cannot fully understand the development of work law in Canada without reference to Can-
ada’s trade policies over the years.
Canada has negotiated many bilateral or multilateral trade agreements that reduce or elim-
inate tariffs to encourage lower-cost international trade. Trade agreements can have both direct
and indirect effects on work laws, although in practice the effects have been mostly of the latter
variety.
A. Direct Effects of Trade Agreements on Canadian Work Law

A trade agreement can have a direct effect on a country’s work laws by imposing an obligation
to enact new laws or repeal or enforce existing work laws. The clearest example is provided by
the European Union (EU), where laws (“directives” and “regulations”) enacted by the European
Parliament targeting employment practices are legally binding on member countries and
enforceable before the European Court of Justice.24 Canada is not party to any supranational
legislative body similar to the EU, although it is party to trade agreements that include legally
enforceable rules. For example, the General Agreement on Tariffs and Trade (GATT) is an inter-
national trade agreement that includes rules about tariffs and prohibits Canada from treating
foreign-based companies less favourably than Canadian companies. Those rules can be enforced
through the legal machinery of the World Trade Organization (WTO), an international organ-
ization created in 1995 to deal with the rules of trade between nations.25 For example, in 2000,
a WTO panel struck down the Canada – US Autopact as contrary to international trade rules
that were binding on Canada.26
protectionist trade law: A law that favours domestic goods or services over goods and services offered by providers located
in other jurisdictions, such as a law that imposes import tariffs on goods manufactured in other countries.
bilateral trade agreement: A trade agreement between two nations.
multilateral trade agreement: A trade agreement between more than two nations.

The international trade agreements Canada is party to do not include direct obligations relat-
ing to work law. Whether international and regional agreements should link preferential trade
rules (such as lower tariffs) to compliance with a set of core labour standards was one of the great
public debates of the 1990s. Inclusion of a social clause in WTO trade agreements, which would
condition trade benefits on compliance with labour rights, was one of the central demands of
protesters at the WTO meetings in Seattle in 1999. The Seattle WTO meetings were shut down
following violent clashes between police and protesters.27 In the end, the argument that trade
benefits should be linked to labour rights in international trade agreements was rejected.
Canada is party to several trade agreements that include more limited obligations relating to
work laws. These obligations arise from “labour side agreements” appended to trade agreements,
often referred to as labour cooperation agreements (LCAs). As of 2019, Canada had entered
into eight such agreements.28 With the exception of the North American Agreement on Labor
Cooperation (NAALC)—which includes Canada, the United States, and Mexico—these agree-
ments are bilateral (see Table 27.1).
TABLE 27.1 Canada’s Labour Cooperation Agreements

Effective Date Labour Cooperation Agreement
1994 North American Agreement on Labor Cooperation
1997 Canada–Chile Agreement on Labour Cooperation
2002 Canada–Costa Rica Agreement on Labour Cooperation
2009 Canada–Peru Agreement on Labour Cooperation
2010 Canada–Panama Agreement on Labour Cooperation
2011 Canada–Colombia Agreement on Labour Cooperation
2012 Canada–Jordan Agreement on Labour Cooperation
2014 Canada–Honduras Agreement on Labour Cooperation
The NAALC was annexed to the controversial North American Free Trade Agreement
(NAFTA), which created a “free trade” zone between Canada, the United States, and Mexico.
The principal obligation the NAALC imposes on the three member countries is “effective
enforcement of national labor law.”29 Therefore, the NAALC does not impose any new work law
obligations on Canada, but instead it requires Canadian governments to enforce whatever laws
they choose to enact. For this reason, the NAALC has been criticized for failing to raise labour
standards in any of the three participating countries.
Following an extended period of negotiations, prompted by US President Donald Trump, the
three signatory countries to NAFTA concluded a revised Canada – United States – Mexico Agree-
ment (CUSMA) (the United States refers to the agreement as USMCA) in 2018.30 The CUSMA
includes revised rules on labour issues, including a requirement that the countries comply with
social clause: A clause included in a trade agreement that would in some manner condition access to trade benefits, such as
lower tariffs, upon compliance with certain defined work law standards.
labour cooperation agreement (LCA): An agreement between nations, often appended to a trade agreement, that imposes
obligations on nations to work toward improving labour standards within their borders.

the ILO’s Declaration on Fundamental Principles and Rights at Work, mentioned above. As of
December 2019, Canada had not yet ratified the CUSMA but was expected to do so in 2020.
US President Donald Trump, centre; Canada’s Prime Minister Justin Trudeau, right; and Mexico’s President
Enrique Pena Nieto, left, sign the CUSMA.
The NAALC enables governments or private parties to file complaints alleging that a country
is not enforcing its own laws. The complaint must be filed with the NAALC office (known as the
National Administrative Office [NAO]) of a country other than the one in which the violation
is alleged to have occurred. A complaint may initiate an investigation, consultations between the
labour ministers of the three countries, and in some circumstances (relating to child protection,
minimum wage, and health and safety only), an independent arbitration panel that has the
power to fine an offending government if it has shown a “persistent pattern of failure to effect-
ively enforce” national laws.31
Most complaints filed under the NAALC have targeted Mexico’s alleged failure to enforce its
work laws, although a couple of complaints have targeted Canada. In one, a coalition of unions
alleged that Quebec was failing to protect workers who are dismissed when their employer sud-
denly closes to avoid a union.32 The other complaint challenged a federal law that denied collec-
tive bargaining rights and health and safety protections to rural mail carriers employed by
Canada Post. The complaint was not accepted on the grounds that the NAALC does not regulate
the content of laws, only the non-enforcement of laws.33 Little came of the first complaint; the
file was closed after Quebec agreed to study the issue. In practice, the NAALC has had little if
any direct effect on Canadian work law.
The LCAs appended to bilateral trade agreements since 2002 (see Table 27.1) function in a
manner similar to the NAALC. However, unlike the NAALC and Canada – Chile Agreement,

they refer specifically to the “obligations” of both countries to comply with the ILO’s Declaration
on Fundamental Principles and Rights at Work. It remains to be seen what effect, if any, this
explicit reference to the ILO Declaration will have on legal developments in the various coun-
tries (including under the CUSMA, if it is eventually ratified).
B. Indirect Effects of Trade Agreements on Canadian Work Law

The fact that trade agreements have had little if any direct effect on Canadian work laws does
not mean that the development of our domestic work laws has not been influenced by Canada’s
participation in the global economy. The dismantling of trade barriers, part of a wider process
of economic globalization, has influenced the political climate in which work laws are de-
veloped and applied. Economic globalization describes a process of economic integration across
national borders facilitated by several key developments, including (1) trade agreements that
dismantle trade tariffs; (2) new information technologies that enable instantaneous supply chain
coordination across vast geographical spaces; and (3) improved transportation and tracking
systems that facilitate efficient global supply chain systems.34 Economic globalization facilitates
greater capital mobility across national borders, and this, in theory at least, creates the possibility
of a race to the bottom in labour standards as nations compete for business investment by offer-
ing lower labour standards or fewer or weaker unions.
Concerns that “free” trade agreements would create downward pressure on Canadian work
laws have been voiced every time Canada has entered into negotiations for a new trade agree-
ment. The biggest concern, and loudest opposition from opponents of the trade agreements, was
reserved for trade deals with Canada’s largest trading partner: the United States. The United
States accounts for approximately 75 percent of Canada’s exports and just under 50 percent of
its imports.35 When the Canada – United States Free Trade Agreement (CUFTA) was being
negotiated in the late 1980s, Canadians were engrossed in debates over whether more open
trade with the United States would eventually lead to the dismantling of Canadian social pro-
grams, massive Canadian job losses, and a downward adjustment in Canadian work law stan-
dards toward the less protective American levels.36 CUFTA was the central issue in the 1988
federal election. The Conservatives supported the deal, while both the Liberals and the New
Democratic Party were opposed to it. Brian Mulroney’s Conservatives won, and the agreement
passed.
Professor Kevin Banks (Queen’s University) explains the basis of the argument that trade
agreements (particularly but not exclusively with the United States) tend to put downward pres-
sure on Canadian work laws:
That thesis essentially consists of four propositions. The first is that unit labour cost differences matter
in international competition between enterprises for market share and between jurisdictions for
investment. The second is that because goods, services, and capital are much more internationally
mobile than labour, production and jobs will move toward jurisdictions with labour market condi-
tions and policy environments that favour low unit labour costs. … The third proposition is that
labour and employment laws increase unit labour costs enough to matter in this competition. As a
result—and this is the fourth proposition—trade and investment integration will drive a global
market in labour regulation. Internationally mobile producers and domestic industries faced with
international competition will respond to unit labour cost pressures by putting political pressure on
national governments. Over time, governments will respond to this pressure, opting for low-cost
economic globalization: A term used to describe a confluence of factors that enable and promote global integration,
including (1) trade agreements that dismantle trade tariffs; (2) new information technologies that enable instantaneous supply
chain coordination across vast geographical spaces; and (3) improved transportation and tracking systems that facilitate efficient
global supply chain systems.

regulatory environments in order to attract and retain production facilities and to ensure the future
viability of enterprises within their borders. Such regulatory competition would be expected to affect
Canada more than the US, because Canada’s trade and investment relationship with the US accounts
for such a large share of the Canadian gross domestic product, and because American labour and
employment laws are generally considered to be less protective.37
The same concerns about downward pressures on Canada’s work laws resurfaced in the
buildup to NAFTA, which brought Mexico, a developing country, into the trade pact with
Canada and the United States.38 In the case of NAFTA, Americans were especially concerned
that jobs would be lost to Mexico, where labour costs were substantially lower. Those concerns
led then-President Bill Clinton to insist upon the inclusion of the NAALC in NAFTA. Similar
concerns have driven President Trump’s contemporary opposition to NAFTA.
Whether the dire predictions that CUFTA and NAFTA would lead to a gutting of Canadian
work laws have come to pass is a matter of ongoing debate.39 It is difficult if not impossible to
isolate the effects of a trade agreement from all other possible causes of legal reform. Certainly,
there are anecdotal stories of US corporations closing Canadian subsidiaries and returning to
the United States where many work laws are less protective of workers, as described in Box 27.2.
When that happens, sometimes Canadian work laws or decent collective agreements bargained
by Canadian unions are blamed. At a more aggregate level, however, little empirical evidence
supports the thesis that work laws play a substantial role in business decisions about where to
invest, at least between economically developed nations, which comprise the vast majority of
international trade.40 Other factors, such as currency rates, the quality of infrastructure (elec-
tricity, water, roads, etc.), the business environment, the skills of the labour force, access to
markets, and the quality of the legal system, are of much greater significance in investment
decisions.41

Was Work Law to Blame for the Closure of a Caterpillar Plant in Ontario?
In 2012, a locomotive plant near London, Ontario owned by “This is legislation which completely undermines the work-
giant American corporation Caterpillar closed its doors for ers’ ability to bargain collectively,” said local Member of Parlia-
good. About 450 Canadian workers lost their jobs. The closure ment Irene Mathyssen.*
came after the workers were locked out for a month
when they and their union, the Canadian Auto Work-
ers, refused Caterpillar’s demand for a 50 percent pay
cut to bring their pay in line with lower-waged Amer-
ican operations.
Caterpillar was coming off a record profit year, hav-
ing earned $4.9 billion in 2011. Some of the plant’s
work was transferred to a new factory in Indiana,
where the state government had offered multi-million
dollar tax incentives to lure the company from Ontario.
The announcement from Caterpillar that the Ontario
factory would close came less than two days after the
Indiana government enacted a “right to work” law
designed to weaken unions and discourage collective
bargaining. (In this context, “right to work” refers to
laws in some American states that allow workers to
opt out of joining a union and from paying union Workers on the picket line in February 2012, during the bitter closure of a
dues.) factory owned by Caterpillar in London, Ontario.
Source: Mark Spowart/Alam.

The plant owned by Caterpillar, known as EMD (Electro- given approval. According to Walkom, “Caterpillar clearly had
Motive Diesel) had been a part of London’s economy since no intention of keeping its newly purchased London locomo-
1949, and as with the loss of most industrial jobs, the closure tive plant open—and closed it as soon as the company’s pre-
had an economic ripple effect beyond the hundreds of plant ferred location, Indiana, passed anti-union laws.”‡
workers themselves. The EMD plant was purchased by Cater- By acting in concert, anti-union corporations such as Cat-
pillar—a notoriously anti-union employer—in 2010. Within the erpillar along with sympathetic state governments have been
next several years, many governments in U.S. states (primarily able to use the threat of moving plants and factories to lower-
Republican-dominated state governments) enacted anti-union wage jurisdictions around the world as a way of undermining
legislation, including the sort of “right to work” laws described unionized workers. As noted above, the company had originally
above. offered workers a deal that cut their wages in half, along with
According to some observers, this outcome was the logical other concessions. As workforces become more global, the
outcome of the current era of largely unfettered trade. In re- threat of moving an entire operation elsewhere gives powerful
sponse to the plant’s closing, the Conservative federal govern- leverage to corporations. Given this dynamic, it is not entirely
ment of Stephen Harper and the Liberal provincial government surprising that the proportion of unionized jobs in the work-
in Ontario led by Dalton McGuinty were uninterested in inter- force has been in steady decline for forty years. (See the “Law
vening. Toronto Star columnist Thomas Walkom wrote: of Work Timeline” graph on page xxvii of the preface.)
Neither did anything. But the real villain is unre- * Irene Mathyssen, “Caterpillar Shut-Down: How Many More
strained globalization. As long as goods and capital Manufacturing Jobs Must We Lose?” Huffingon Post (4 April 2012),
are free to move unimpeded across national borders, online: <https://www.huffingtonpost.ca/irene-mathyssen-mp/
caterpillar-close_b_1253005.html>.
companies—even nice ones—will locate where
wages are cheap. All of this could be changed. But † Thomas Walkom, “The Real Villain of Caterpillar Shutdown? Mindless
Free Trade,” Toronto Star (8 February 2012), online: <https://www.thestar.
to do so would require the fundamental rethinking com/news/canada/2012/02/08/walkom_the_real_villain_of_caterpillar_
of belief in the unalloyed virtue of free trade, a belief shutdown_mindless_free_trade.html>.
that the country’s political and business classes ac- Sources: Based on “Caterpillar Closing Toronto Plant, 330 Workers to Lose
cept on faith.† Jobs,” CBC News (4 May 2013), online: <https://www.cbc.ca/news/canada/
toronto/caterpillar-closing-toronto-plant-330-workers-to-lose-jobs
Walkom and other critics of current trade practices suggest -1.1395290>; Mathyssen, ibid.; Walkom, ibid.
that any foreign company wishing to purchase a Canadian
company—particularly anti-union ones such as Caterpillar—
should be given much more serious scrutiny before being
However, the perception that businesses will not invest in Canada because our work laws are
more protective of workers than in other jurisdictions has played an important role in shaping
labour policy debates, especially since the enactment of CUFTA and NAFTA in the early 1990s.
Professor Harry Arthurs (York University) describes this impact as the “globalization of the
mind.”42 The narrative that employers will avoid Canada unless we weaken our work laws can
create downward pressure on those laws, even if the narrative is in fact false or the risk is over-
stated. We can see this indirect effect of trade liberalization in almost every debate about work
law reform in Canada over the past 20 years. It is now commonplace for Canadian politicians to
justify reforms to work law that reduce the level of worker protections by reference to the need
to “compete” in the global economy.
As one example, in the mid-1990s, the Conservative government in Ontario enacted a series
of reforms intended to weaken collective bargaining rights and other statutory employee

protections. The minister of labour rose in the legislature in the fall of 1995 and explained the
justification for the changes:
We believe that the current Labour Relations Act is a barrier to jobs, growth and investment. In a
global economy, Ontario cannot afford to be perceived as anything less than welcoming to the initia-
tive, the imagination and job creation potential of the private sector.43
Inversely, legislative reforms that strengthen collective bargaining rights and employment
standards are routinely described as “job killers” by businesses and especially (but not exclu-
sively) conservative politicians and commentators, who argue that businesses will leave to avoid
these laws. That sentiment is captured nicely in the following 1992 speech in the BC legislature
by a Liberal MPP, criticizing a bill introduced by the NDP government that would strengthen
collective bargaining rights:
In preparation for debating this bill, I want to tell you that the Liberal opposition thought about going
to the very people who will benefit from the bill. We talked to labour lawyers, and they told us that
there will not be a sudden flood of investment disappearing from the province; it will be a slow and
steady erosion. In this modern era of a global economy, you simply cannot pass labour legislation as
an island. Capital, unfortunately, can go anywhere in the world; it can go into Whatcom County, for
example.44
Whatcom County is in Washington State, just south of British Columbia. We could tour the
country to every jurisdiction that has enacted work-related legislation in the past 20 years and
find similar commentary in the legislatures. Trade liberalization has affected Canadian work
laws by influencing the form and substance of debates over work law reform. It has strengthened
the claims that Canada must compete with other jurisdictions for investment and jobs, and that
relatively strong protective work laws discourage both. In this way, trade agreements, and the
more general processes of economic globalization, act as “conditioning frameworks” that shape
public discourse to the benefit of those interests that prefer fewer regulatory protections for
workers.45 Since Canada entered into CUFTA and NAFTA, it has become progressively more
difficult for politicians to campaign on and then sustain generous protective labour laws in the
face of arguments (and sometimes threats) by business and pro-trade advocates that such laws
will ultimately drive businesses to leave in search of less-regulated jurisdictions.
IV. Chapter Summary

In this final chapter of Part III of this text, we explored how Canada’s participation in the global
economy affects the development of Canadian work laws. We began by considering the role of
the ILO, the global institution responsible for promoting decent working standards around the
world. Canada is expected to realize ILO rules and principles. These rules have influenced Can-
adian governments in relation to the work laws they enact and the Supreme Court of Canada in
its interpretation of the guarantees found in the Charter. The impact on Canadian work laws of
Canada’s participation in trade laws is less obvious, but still important. Of particular importance
is the indirect effect that trade laws have had on shaping the discourse around Canadian labour
policy.

1. Summarize the guiding philosophy of the ILO. In your summary, explain why the promo-
tion of decent working conditions is considered an important and necessary objective for
national governments.
2. Explain the meaning of the phrase “labour is not a commodity.”

3. When Canada ratifies an ILO Convention, do the legal rules in that Convention immedi-
ately become legally enforceable in Canada? Explain.
4. How has the ILO influenced Canadian work law?
5. Summarize the explanation Professor Kevin Banks provides (in an excerpt in this chapter)
on why many people believe trade agreements with the United States will eventually have
the effect of weakening Canadian work laws.
6. What did Professor Harry Arthurs mean when he wrote that globalization and free trade
are leading to “globalization of the mind”?
EXERCISES
1. The ILO is guided by the idea that “labour is not a commodity.” This concept has, on occa-
sion, been cited by Canadian courts as they deal with work law cases. This exercise explores this
term’s usage in Canadian work law.
a. Go to the CanLII website: <https://www.canlii.org>.
b. Enter in the Document Text search window “labour is not a commodity.”
c. Select a decision that looks interesting to you and read it.
d. Prepare a case summary like those found in the Case Law Highlight boxes in the text,
outlining the facts, issue, and decision of the case.
e. For what purpose is the court referring to “labour is not a commodity”?
2. In this chapter, we noted that Canada has a poor record of violating its obligations to protect
“freedom of association” of its citizens as required by its membership in the International
Labour Organization. The ILO maintains an electronic database of its proceedings. In this exer-
cise, we search that database for ILO decisions involving Canada.
1. Go to the ILO’s website called NORMLEX (information on international labour standards),
which compiles cases decided by the Committee on Freedom of Association: <http://www
.ilo.org/dyn/normlex/en/f?p=NORMLEXPUB:20060>.
2. Select Canada in the “All Countries” drop-down menu under the “Browse Cases by” head-
ing, then select “Find.” That search should give you a long list of “cases” with Canada in
brackets (e.g., “Case No 2403 (Canada)”).
3. Select a sample of those cases and look for one in which the Committee on Freedom of
Association explains the nature of the complaint and makes recommendations.
4. Read the report and answer the following questions:
a. Who is the complainant (who filed the complaint)?
b. Which Canadian government is alleged to have violated freedom of association?
c. What is the nature of the alleged violation?
d. What position does the government take in its response to the complaint?
e. What does the committee conclude?
f. What recommendations are made?

1. International Labour Organization (ILO), “Mission and en/f?p=1000:62:0::NO:62:P62_LIST_ENTRIE_
Objectives,” online: <https://www.ilo.org/global/about-the ID:2453907:NO#declaration>.
-ilo/mission-and-objectives/lang--en/index.htm>. 4. D. Beatty, “Labour Is Not a Commodity” in B. Reiter &
2. Treaty of Versailles, June 28, 1919, at Pt. XIII, Labour, s. I, K. Swan, eds, Studies in Contract Law (Toronto, ON:
“Organisation of Labour.” Butterworths, 1979) at 314; and J. Fudge, “Labour Is Not a
3. ILO, “Declaration of Philadelphia” (1944), online: <http:// Commodity: The Supreme Court of Canada and the
www.ilo.org/dyn/normlex/ Freedom of Association” (2004) 67 Sask L Rev 425.

5. Beatty, supra note 4 at 323-24. 15. Convention 87 does not expressly include a right to strike.
6. Lavigne v. Ontario Public Service Employees Union, [1991] However, the ILO’s expert bodies long ago decided that the
2 SCR 211. See also Slaight Communications Inc. v. David- right to strike is fundamental to the ability to engage in
son, [1989] 1 SCR 1038. collective bargaining and is therefore implied within Con-
vention 87. See ILO, “C087—Freedom of Association and
7. M. Wachter, “Neoclassical Labor Economics: Its Implica-
Protection of the Right to Organise Convention, 1948
tions for Labor and Employment Law” in C. Estlund &
(No. 87),” online: <http://www.ilo.org/dyn/normlex/en/f?p
M. Wachter, eds, Research Handbook on the Economics of
=NORMLEXPUB:12100:0::NO::P12100_INSTRUMENT
Labor and Employment Law (Cheltenham, UK: Edward
_ID:312232>. See also Bellace, supra note 8; and B. Gerni-
Elgar, 2012) at 20; and A. Armen & W. Allen, University
gon, A. Odero, & H. Guido, ILO Principles Concerning
Economics, 3rd ed (Belmont, CA: Wadsworth, 1972) at
the Right to Strike (Geneva: ILO, 1998), online (pdf):
407.
<http://ilo.org/wcmsp5/groups/public/@ed_norm/@
8. See the discussion in J. Bellace, “The ILO and the Right to normes/documents/publication/wcms_087987.pdf>.
Strike” (2014) 153 Intl Lab Rev 29; and L. Swepston,
16. See ILO, “C098—Right to Organise and Collective Bar-
“Crisis in the ILO Supervisory System: Dispute over the
gaining Convention, 1949 (No. 98),” online: <http://www
Right to Strike” (2013) 29:2 Intl J Comp Lab L & Ind
.ilo.org/dyn/normlex/en/f?p=1000:12100:0::no::P12100_
Rel 199
Ilo_Code:C098>.
9. See B. Burkett, J. Craig, & J. Gallagher, “Canada and the
17. This claim is expressed in the language of the ILO’s 1998
ILO: Freedom of Association Since 1982” (2003) 10 CLELJ
Declaration on Fundamental Principles and Rights at Work,
231.
articles 1 and 2. See H. Kellerson, “The ILO Declaration of
10. For a more sophisticated and detailed description of how 1998 on Fundamental Principles and Rights: A Challenge
the ILO functions, see ILO, “How the ILO Works,” online: for the Future” (1998) 137 Intl Lab Rev 223; and
<https://www.ilo.org/global/about-the-ilo/how-the-ilo R.J. Adams, “The Supreme Court, Collective Bargaining,
-works/lang--en/index.htm>; and B. Langille, “Can We and International Law: A Reply to Brian Langille” (2009)
Rely on the ILO?” (2007) 13 CLELJ 363. 14 CLELJ 317.
11. See the list of Conventions at ILO, “Conventions,” online: 18. You can find reports from the Committee on Freedom of
<http://www.ilo.org/dyn/normlex/en/f?p=1000: Association involving Canada through the ILO’s
12000:0::NO>. NORMLEX search engine: <http://www.ilo.org/dyn/
12. See Attorney-General for Canada (Attorney General) v. normlex/en/f?p=1000:20060:0:FIND:NO>.
Ontario (Attorney General), 1937 CanLII 362 (UK JCPC). 19. See Fudge, supra note 4 at 448; and B. Burkett, J. Craig, &
For many years after this decision, there was uncertainty J. Gallagher, supra note 9. Canadian unions have been
about whether Canada could ratify any ILO Convention more willing to use the ILO complaints procedure than
relating to subjects falling within provincial jurisdiction. have labour movements in other countries, which in part
As a result, between 1937 and the late 1950s, Canada rati- accounts for the large number of decisions involving
fied only Conventions dealing with subject matter that fell Canada by the CFA.
within federal jurisdiction, such as rules about working
20. ILO, 330th Report of the Committee on Freedom of Associa-
conditions in the shipping industry. In the late 1950s,
tion (Geneva: Author, 2003) at para 304.
Canada revised its position and accepted that the federal
government could ratify any ILO Convention, but that it 21. ILO, 1998 Declaration on Fundamental Principles and
would need to consult with and rely on the provinces to Rights at Work, online: <http://www.ilo.org/dyn/normlex/
enact instantiating legislation. See the discussion in en/f?p=1000:62:0::NO:62:P62_LIST_ENTRIE_
R. Matthews & C. Pratt, Human Rights in Canadian ID:2453911:NO>.
Foreign Policy (Montreal, QC: McGill-Queen’s University 22. The key federal laws that govern trade-related tariffs are
Press, 1988) at 119-22. the Customs Act, RSC 1985, c. 1 (2nd Supp.) and the
13. See Canada’s ratification record at ILO, “Ratifications for Customs Tariff, SC 1997, c. 36, as well as the many regula-
Canada,” <https://www.ilo.org/dyn/normlex/en/f?p=NOR tions associated with that legislation.
MLEXPUB:11200:0::NO::P11200_COUNTRY_ 23. H. Arthurs, “Extraterritoriality by Other Means: How
ID:102582>. Labor Law Sneaks Across Borders, Conquers Minds, and
14. You can read the Committee of Experts’ observations on Controls Workers Abroad” (2010) 21 Stan L & Pol’y Rev
Canada’s reports by searching Canada on the ILO’s 527 at 534.
NORMLEX search engine: <http://www.ilo.org/dyn/ 24. See the discussion of the scope of the EU’s jurisdiction
normlex/en/f?p=1000:20010:0::NO>. over work-related practices at European Commission,

“Rights at Work,” online: <http://ec.europa.eu/social/main M. Gunderson, “Canada – U.S. Free Trade and Labour
.jsp?catId=82&langId=en>. See also C. Barnard, EU Relations” (1990) 41 Lab LJ 454; and R. Sears, “The Great
Employment Law, 4th ed (Oxford, UK: Oxford University Free-Trade Election of 1988,” Globe and Mail (October
Press, 2012). 2012), online: <http://www.theglobeandmail.com/globe
25. World Trade Organization, “What Is the WTO?” online: -debate/the-great-free-trade-election-of-1988/
<https://www.wto.org/english/thewto_e/whatis_e/ article4576124>.
whatis_e.htm>. 37. Banks, supra note 35 at 427.
26. D. Anastakis, “Requiem for a Trade Agreement: The Auto 38. See, for example, M. Gunderson, “Harmonization of
Pact at the WTO, 1999 – 2000” (2001) 34:3 Can Bus LJ 313. Labour Policies Under Trade Liberalization” (1998) 53
27 See C. Summers, “The Battle in Seattle: Free Trade, Labor Indus Rel 1; P. Singh, “NAFTA and Labor: A Canadian
Rights, and Societal Values” (2001) 22 U Pa J Intl Econ L. Perspective” (2002) 23 J Lab Res 433; and Banks, supra
See also the film Battle in Seattle, directed by Stuart note 35.
Townsend (2007, Redwood Palms Pictures). 39. See, for example, Banks, supra note 35; R. Gomez &
28. See links to the LCAs at Government of Canada, “Negoti- M. Gunderson, “Does Economic Integration Lead to
ating and Implementing International Labour Coopera- Social Policy Convergence? An Analysis of North Amer-
tion Agreements,” <https://www.canada.ca/en/ ican Linkages and Social Policy” in R. Harris & T.
employment-social-development/services/labour-rela Lemieux, eds, Social and Labour Market Aspects of North
tions/international/agreements.html>. American Linkages (Calgary, AB: University of Calgary
Press, 2005) at 309; Singh, supra note 38; Gunderson,
29. See Secretariat of the Commission for Labor Cooperation,
supra note 38; and B. Langille, “General Reflections on the
“NAALC—Part Two: Obligations,” online: <https://www
Relationship of Trade and Labor (Or: Fair Trade Is Free
.canada.ca/en/employment-social-development/services/
Trade’s Destiny)” in J. Bhagwati & R. Hudec, eds, Fair
labour-relations/international/agreements/naalc.
Trade and Harmonization: Prerequisites for Free Trade? Vol.
html#p2>.
2: Legal Analysis (Cambridge, MA: MIT Press, 1996) 231.
30. For a summary of the labour elements in the CUSMA, see
40. See the discussion in Banks, supra note 35.
<https://www.international.gc.ca/trade-commerce/trade
-agreements-accords-commerciaux/agr-acc/cusma 41. Ibid. See also Gunderson, supra note 38; and M. Gunder-
-aceum/labour-travail.aspx?lang=eng>. son, “Ten Key Ingredients of Labour Policy in the New
World of Work” (2002) 28 Can Pub Pol’y 117.
31. See Secretariat of the Commission for Labor Cooperation,
“NAALC—Part Five: Resolution of Disputes,” online: 42. See H. Arthurs, “Who’s Afraid of Globalization? Reflec-
<https://www.canada.ca/en/employment-social-develop tions on the Future of Labour Law” in J.D.R. Craig &
ment/services/labour-relations/international/agreements/ S.M. Lynk, eds, Globalization and the Future of Labour Law
naalc.html#p5>. (Cambridge, UK: Cambridge University Press, 2006).
32. U.S. NAO 9803 (1998). 43. See Legislative Assembly of Ontario, Debates (Hansard),
October 4, 1995. Comments by Hon. Elizabeth Witmer,
33. U.S. NAO 9804 (1998).
minister of labour, online: <http://hansardindex.ontla.on
34. See D. Doorey, “International Business and Globalization” .ca/hansardeissue/36-1/l006.htm>.
in W.P. Kissick, ed, Business Ethics: Concepts, Cases and
44. See 1992 Legislative Session: 1st Session, 35th Parliament,
Canadian Perspectives (Toronto, ON: Emond Montgomery,
Hansard, British Columbia, November 5, 1992. Comments
2012) 169 at 172-73.
by Hon. Wilf Hurd, MPP (Liberal), online: <https://www
35. K. Banks, “Must Canada Change Its Labour and Employ- .leg.bc.ca/content/Hansard/35th1st/19921105pm-Hansard
ment Laws to Compete with the United States?” (2013) 38 -v6n5.htm>.
Queen’s LJ 419 at 423.
45. H. Arthurs, “Labour Law Without the State?” (1996) 46
36. See B. Langille, “Canadian Labour Law Reform and Free UTLJ 1 at 20.
Trade” (1991) 23 Ottawa L Rev 581; G. Betcherman &

Selected Cases: Part III
Alberta (Human Rights and Citizenship Commission) v. Kellogg Brown

& Root (Canada) Company, 2007 ABCA 426 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 369
B. v. Ontario (Human Rights Commission), 2002 SCC 66 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 364, 368, 370, 390
Balikama obo Others v. Khaira Enterprises and Others, 2014 BCHRT 107 . . . . . . . . . . . . . . . . . . . . . . . . . . . 361
BC WCAT Decision No. A1701552 (Re), 2018 CanLII 75253 (BCWCAT)��397
Bhinder v. CN, [1985] 2 SCR 561 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 349
Bliss v. Attorney-General of Canada, [1979] 1 SCR 183 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 369
British Columbia (Public Service Employee Relations Commission) v. BCGSEU,
[1999] 3 SCR 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 347, 350, 369, 375, 389
British Columbia (Workers’ Compensation Board) v. Figliola, 2011 SCC 52 . . . . . . . . . . . . . . . . . . . . . . . . . . . 349
Brooks v. Canada Safeway Ltd., [1989] 1 SCR 1219 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 359, 369
Brossard (Town) v. Quebec (Commission des droits de la personne), [1988] 2 SCR 279 . . . . . . . . . 356, 370, 390
Canada (Attorney General) v. Johnstone, 2014 FCA 110 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 365, 371
Canada (Attorney General) v. Ontario (Attorney General), 1937 CanLII 363 (UK JCPC) . . . . . . . . . . . . . . . 453
Canadian Union of Public Employees, Local 4848 v. Ambulance New Brunswick Inc.
(Saunders Grievance), 2012 CanLII 97787 (NBLA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 389, 390
Carasco v. University of Windsor, 2010 HRTO 2090, 2010 HRTO 1968 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 349
Central Alberta Dairy Pool v. Alberta (Human Rights Commission),
[1990] 2 SCR 489 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 346, 347, 349, 363, 370, 380, 383, 389
Central Okanagan School District No. 23 v. Renaud (1992), [1992] 2 SCR 970 . . . . . . . . . . . . 379, 380, 383, 389
Colwell v. Cornerstone Properties Inc., 2008 CanLII 66139 (Ont. Sup Ct J) . . . . . . . . . . . . . . . . . . . . . . . 432, 436
Commission scolaire régionale de Chambly v. Bergevin, [1994] 2 SCR 525 . . . . . . . . . . . . . . . . . . . . . . . . 389, 390
Communications, Energy and Paperworkers Union of Canada, Local 30 v.
Irving Pulp & Paper, Ltd., 2013 SCC 34 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 369, 433, 437
Construction and Specialized Workers’ Union, Local 1611 v. Canada (Citizenship and Immigration),
2013 FC 512 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 414
Construction Montcalm Inc. v. Min. Wage Com., [1979] 1 SCR 754 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 282
Davies v. Fraser Collection Services Limited, 2008 BCSC 942 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 334
Dominguez v. Northland Properties Corporation, 2013 BCSC 468 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 416, 417
Eastmond v. Canadian Pacific Railway, 2004 FC 852 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 435, 437
1748271 Ontario Inc. v. Patterson, 2015 CanLII 26117 (Ont. LRB) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 313
Elsegood v. Cambridge Spring Service (2001) Ltd., 2011 ONCA 831 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 334
Entrop v. Imperial Oil Limited, 2000 CanLII 16800 (Ont. CA) . . . . . . . . . . . . . . . . . . . . . 369, 375, 382, 388, 430
Erskine v. British Columbia (Workers’ Compensation Appeal Tribunal), 2013 BCSC 1583 . . . . . . . . . . . . . . . 400
Fresco v. Canadian Imperial Bank of Commerce, 2012 ONCA 444 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 318
Harrison v. University of British Columbia, [1990] 3 SCR 451 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 370
Hydro-Québec v. Syndicat des employeé-e-s de techniques professionnelles et de bureau
d’Hydro-Québec, section locale 2000 (SCFP-FTQ), 2008 SCC 43 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 389, 390
Islam v. Big Inc. 2013 HRTO 2009; aff ’d 2015 ONSC 2921�� 349, 364, 370
Janzen v. Platy Enterprises Ltd., [1989] 1 SCR 1252 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 360, 368, 369, 370
Jazairi v. Ontario (Human Rights Commission), 1999 CanLII 3744 (Ont. CA) . . . . . . . . . . . . . . . . . . . . 364, 370
Jones v. Tsige, 2012 ONCA 32 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 430, 431, 432, 436
Lane v. ADGA Group Consultants Inc., 2007 HRTO 34 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 349, 381, 390
455

Lavigne v. Ontario Public Service Employees Union, [1991] 2 SCR 211 . . . . . . . . . . . . . . . . . . . . . . . . . . . 441, 453
Loomba v. Home Depot Canada, 2010 HRTO 1434 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 349, 368, 370
McKinney v. University of Guelph, [1990] 3 SCR 229 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 370
Meiorin, see British Columbia (Public Service Employee Relations Commission) v. BCGSEU
O’Malley, see Ont. Human Rights Comm. v. Simpsons-Sears
Ont. Human Rights Comm. v. Simpsons-Sears, [1985] 2 SCR 536 . . . . . . . . . . . . . . 340, 348, 349, 368, 378, 390
Ontario Human Rights Commission v. Christian Horizons, 2010 ONSC 2105 . . . . . . . . . . . . . . . . . . . . . . . . . 385
Ontario Nurses’ Association v. Orillia Soldiers Memorial Hospital, 1999 CanLII 3687 (Ont. CA) . . . . . . . . . 375
Oosterbosch v. FAG Aerospace Inc., 2011 ONSC 1538 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 326, 334
Public Service Alliance of Canada v. Canada Post Corp., 2011 SCC 57 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 299
Quebec (Commission des droits de la personne et des droits de la jeunesse) v. Montréal (City),
2000 SCC 27 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 358, 369
R v. Metron Construction Corporation, 2013 ONCA 541 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 404
Re Leisure World Nursing Homes Ltd. and Director of Employment Standards, 1980 CanLII 1681
(Ont. H Ct J) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 295
Richardson v. Davis Wire Industries Ltd., 1997 CanLII 4221 (BCSC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 426, 436
Riddell v. IBM Canada, 2009 HRTO 1454 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 363, 370
Rizzo & Rizzo Shoes Ltd. (Re), [1998] 1 SCR 27 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 282
Saskatchewan Federation of Labour v. Saskatchewan, 2015 SCC 4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 443
Slaight Communications Inc. v. Davidson, [1989] 1 SCR 1038 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 335, 453
Somwar v. McDonald’s Restaurants of Canada Ltd., 2006 CanLII 202 (Ont. Sup Ct J) . . . . . . . . . . . . . . . . . . 436
Stolze v. Addario, 1997 CanLII 764 (Ont. CA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 334
Stewart v. Elk Valley Coal Corp., 2017 SCC 30 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 353, 358, 368
Toronto Elementary Catholic Teachers v. Toronto Catholic District School Board, 2017 CanLII 37597
(ON LRB) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 396
TCS Express Inc. v. Yasin, 2006 CanLII 19423 (Ont. LRB) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 311
United Steelworkers Obo Others v. Tim Hortons and Others, 2014 BCHRT 152 . . . . . . . . . . . . . . . . . . . . . . . 421
Vrana v. Procor Ltd., 2003 ABQB 98 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 334
Vriend v. Alberta, [1998] 1 SCR 493 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 366, 371
Weihs v. Great Clips and Others (No. 2), 2019 BCHRT 125 ��360
Wilson v. Atomic Energy of Canada Limited, 2016 SCC 29 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 332, 335

PART IV
The Collective Bargaining
Regime
CHAPTER 28 Introduction to the Collective Bargaining Regime and the Canadian

Labour Movement
CHAPTER 29 A Brief History of Labour and the Law
CHAPTER 30 Why Do Workers Join Unions, and What Effects Do Unions Have on
Business?
CHAPTER 31 The Unionization Process
CHAPTER 32 Unfair Labour Practices and the Right to Organize
CHAPTER 33 Collective Bargaining and the Making of a Collective Agreement
CHAPTER 34 The Law of Industrial Conflict
CHAPTER 35 The Collective Agreement
CHAPTER 36 Grievances, Labour Arbitration, and “Just Cause” for Discipline in the
Unionized Workplace
CHAPTER 37 The Regulation of Unions: Legal Status, the Duty of Fair
Representation, and Decertification
CHAPTER 38 Public Sector Labour Relations
Selected Cases: Part IV


CHAPTER 28
Introduction to the Collective

Bargaining Regime and the
Canadian Labour Movement
II. A Brief Overview of the Common Law’s Treatment
• Describe how the common law regime treats collective worker activities, of Collective Worker Activities 460
including unionization, collective bargaining, and strikes. III. The Outputs and Legal Institutions of the Collective
• Describe how early collective bargaining laws modified the common law Bargaining Regime 465
to both create new rights for workers to act collectively and control IV. Who Is Governed by the Collective Bargaining Regime
unions and employee associations. in Canada? 466
• Explain the key legal institutions within the collective bargaining regime V. Canadian Unions Today: A Snapshot 470
and the role they play. VI. Chapter Summary 473
• Identify trends in the composition and quantity of Canadian workers
who are unionized and governed by the collective bargaining regime. Exercises 473
• Discuss the decline in private sector unionization in Canada and the
possible causes of this decline.
• Discuss the basic structure of Canadian unions and the Canadian labour
movement.
I. Introduction
This book examines work relations through the lens of Canadian law and public policy. We are
interested in how legal rules have helped shape and respond to labour market events and inter-
actions. In this part of the book, we turn our attention to the third of the legal regimes of work
law that we introduced in Chapter 1, the collective bargaining regime. A new, important actor is
introduced to our story here: unions. For over 200 years, Canadian workers have banded
together into unions to increase their bargaining power beyond that which any individual
worker can possess alone. At every step in the development of collective worker activity, law has
been harnessed in response, often to crush and resist that activity, sometimes to support and
encourage it, but always to manage it and control conflict between workers, unions, and
employers.
In Chapters 1 and 2 we introduced the “three regimes of work law”: common law, regulatory
standards, and collective bargaining. The common law regime encompasses judge-made rules
relating to employment contracts and torts with application to work. The regulatory standards
regime encompasses government-made legal rules found in statutes and regulations that restrict
freedom of contract in pursuit of public policy goals, such as better working conditions, safer
workplaces, and less discrimination. Whereas the guiding philosophy of the common law regime
459

460 Part IV The Collective Bargaining Regime
is freedom of contract, the regulatory regime assumes that workers are vulnerable in a system
based purely on freedom of contract and subject to the superior power of employers in most cases.
One way to protect vulnerable workers is to introduce mandatory labour standards (the regu-
latory regime). Another method of protecting workers from the harshness of market forces is to
“[turn] up the bargaining power valve on the employees’ side,”1 to borrow the words of Professor
Brian Langille, so that employees are negotiating on a more level playing field. The principal
goals of the collective bargaining regime, explored in the remainder of the book, are to facilitate
worker power by allowing, and sometimes encouraging, workers to engage in collective bargain-
ing rather than individual bargaining, and to then manage the conflict that sometimes results
within a system of collective worker power.
The collective bargaining regime encompasses various legal rules—tort, contract, and
legislative—that govern employment relations as workers transition from the non-union com-
mon law regime to the unionized collective bargaining regime (the union organizing and certi-
fication process) and the relations between unions, employees, and employers after the workers
are unionized (collective bargaining, collective agreement administration, industrial conflict).
This chapter sets up our exploration of the collective bargaining regime by explaining how the
collective bargaining model we use today evolved from, and was initially a response to, common
law judges’ hostile treatment of collective worker activities such as unionization, collective
bargaining, and strikes. We will introduce some key concepts, processes, and institutions that
we will need to understand as we move forward in our exploration of the collective bargaining
regime, before concluding with a description of workers who are governed by the collective
bargaining regime in Canada today and an overview of the Canadian labour movement.
II. A Brief Overview of the Common Law’s Treatment

of Collective Worker Activities
As noted earlier, the regulatory regime is the government’s response to perceived inadequacies
with the manner in which the common law regime governs the work relationship. For example,
minimum wage laws were enacted out of a concern that in the common law regime, where work-
ers usually negotiate employment contracts individually with more powerful employers, the wages
that resulted were unacceptably low. Minimum wage laws were a response to a perceived failure
in the common law: low wages. Similarly, to fully understand how our existing collective bargain-
ing model came to be, we must have at least a basic understanding of how the common law regime
dealt with collective worker activities. Modern collective bargaining legislation operates in the
shadow of common law rules of tort and contract that were often used to crush early attempts by
workers to join unions and pressure their employers to engage in collective bargaining.
Before Canadian governments legislated a process for union recognition in the 1940s, the
only way employees could force an unwilling employer to recognize a union and engage in col-
lective bargaining was to engage in what was often an unlawful strike.2 These work stoppages
were known as recognition strikes, and some of Canada’s most important (and sometimes
violent) labour clashes began this way, before any statutory right to collective bargaining existed.
For example, during a recognition strike at Estevan, Saskatchewan, in 1931, the RCMP shot and
collective bargaining: Negotiations between an association of employees (usually but not always a union) and an employer
or association of employers aimed at reaching a collective agreement.
recognition strike: A strike by workers with the aim of pressuring an employer to recognize and bargain with a union on
behalf of the employees.

Chapter 28 Introduction to the Collective Bargaining Regime and the Canadian Labour Movement 461
killed three strikers, and it was a 1937 recognition strike at General Motors in Oshawa that
produced a landmark collective agreement between the giant automaker and the American-
based United Auto Workers Union (see Chapter 29).3
Prior to collective bargaining legislation, common law judges treated strikes or threats to
strike as torts of conspiracy to injure or intimidation.4 Picketing by workers designed to dis-
suade people from entering a business during a labour dispute could violate torts such as nuis-
ance, intimidation, or inducing breach of contract.5 Union organizers who entered employer
property to speak with workers were trespassing, and if they encouraged workers to strike and
set up picket lines, they could be committing any number of the torts just mentioned, as well as
criminal conspiracy or “watching and besetting” under the Criminal Code.6 A tort or criminal
finding could result in the court issuing an interlocutory injunction order requiring the activity
in question to cease immediately, or imposing a damages award against workers or union lead-
ers. The story of how common law judges invented and used the “labour injunction” to control
and restrict collective worker activities is among the most fascinating in all of law.7
In the common law model, employees who strike—who refuse to come to work as scheduled
while an employment contract is in effect—are probably committing a fundamental breach of
their employment contract that could lead to their termination.8 Until protective collective bar-
gaining legislation was passed in the mid-1940s, employees could also be denied employment for
joining a union or speaking favourably about unionization, and employers could include terms
in employment contracts indicating that support for a union was grounds for summary dismissal
(known as yellow dog contracts).9 In addition, before collective bargaining legislation mandated
a legal “duty to bargain in good faith” (see Chapter 33), employers could simply refuse to recog-
nize and bargain with a union, even if every employee was a union member and wanted the union
to represent them in bargaining with their employer. As we will learn in Chapter 37, unions did
not have legal status in the common law regime—they were considered neither a person nor a
corporation—and therefore lacked any legal means to force an employer to bargain with them.10
This very quick overview of how the common law regime treats collective worker activities
is sufficient to demonstrate that, historically, the common law regime and the judges who pre-
side over it have not been sympathetic to unions or collective bargaining, as Professor Harry
Arthurs explained:
Anglo-Canadian courts have been dealing with issues of individual and collective labour law for at
least two hundred years. During that entire period, the courts virtually never, not on any given occa-
sion, created a right which might be asserted by or on behalf of working people.11
However, this hostile common law environment did not prevent hundreds of thousands of Can-
adian workers from joining unions in pursuit of collective bargaining in the late 19th and early
conspiracy to injure: A tort that involves two or more people acting in combination with the intention of causing harm to
another party and actually causing that harm.
intimidation: A tort that involves an attempt to coerce another person to do something or to refrain from doing something
they are entitled to do by the threat of an unlawful act.
nuisance: A tort in which the activities of one person unreasonably interfere with the use or enjoyment of the property of
another person.
inducing breach of contract: A tort that involves wrongful acts by a third party that are intended to cause a breach of
contract between two other parties.
yellow dog contract: A contract or contract term that requires an employee to refrain from joining a union or permits ter-
mination for cause of an employee who joins a union.

20th centuries, as depicted in Figure 28.1. For most of the period covered in the figure, there
were no formal legal rights protecting a right of workers to join unions, and most collective
worker activities were unlawful under the various common law doctrines just mentioned.
Nevertheless, employers often agreed to bargain with unions “outside of the law,” because if they
refused, the workers might walk off the job. While the strikes were unlawful, in many cases the
employer could not, for practical reasons, fire all of the striking employees since it would take
time to hire and train new workers, who would then need to cross angry picket lines each day.
It made more business sense to work out a deal with the union.
FIGURE 28.1 Trade Union Membership in Canada, 1900 – 1948
1000
PC 1003
900
800
700
Membership (thousands)
600
500
400
300
200
WWI WWII
100
0
1911 1913 1915 1917 1919 1921 1923 1925 1927 1929 1931 1933 1935 1937 1939 1941 1943 1945 1947 1949
Year
Source: Department of Labour. Thirty-sixth Annual Report on Labour Organization in Canada

(Ottawa, ON: King’s Printer, 1948) at 11.

Notice how unionization levels spiked during both World Wars. During the war years, work-
ers acquired unprecedented bargaining power due to labour shortages as thousands of young
men (and some women) joined the military, and that power translated into bumps in union
organizing and collective bargaining as workers responded to what they perceived to be unfair
working conditions. Another spike occurred after 1944, the year the first comprehensive collec-
tive bargaining legislation (called PC 1003, as discussed below) was enacted.
Over time, governments intervened in the common law model in a variety of ways and
for a variety of policy purposes. Sometimes the intervention was aimed at further controlling
unions and workers when the arsenal of torts and hostile contract and criminal law doctrines
proved ineffective at stopping collective worker activities that threatened commerce. For ex-
ample, legislation in the early 20th century sought to reduce strikes by forcing unions and
employers to engage in conciliation and then wait out a “cooling off ” period before a strike
could commence.12 Sometimes legislation was enacted to protect unions and their
members from the harshness of common law rules. For example, the Ontario Rights of Labour
Act excluded union members from liability for the tort of conspiracy when they acted in com-
bination in furtherance of a lawful labour dispute, and in 1932 the Criminal Code was
amended to remove peaceful labour picketing from the definition of criminal watching and
besetting.13
But the most formative legislative change came in the mid-1940s, when the federal govern-
ment introduced the legislative model that still acts as the template for collective bargaining
across Canada today. The legislation passed by the federal government in 1944 during World
War II was known as the Wartime Labour Relations Order, or Order in Council PC 1003.14 PC
1003 was inspired by the “Wagner Act” (the National Labor Relations Act) that had been enacted
in the United States in 1935. PC 1003, the details of which were later adopted by provincial
governments in similar legislation after World War II, ushered in a new legal model that sub-
stantially reduced the reach of the common law over the unionization process, collective bar-
gaining, and labour conflict (see Chapter 29 for more of the history of PC 1003). Box 28.1
describes the important ways in which the legislative model first created by PC 1003 altered how
unionization and collective bargaining was treated under Canadian law.

The Wartime Labour Relations Order
The Wartime Labour Relations Order (PC 1003), enacted by the federal government in 1944, established a statutory scheme that
continues to shape modern collective bargaining legislation today. As the following chart demonstrates, the new legal rights
introduced by PC 1003 fundamentally altered the legal environment that had regulated collective worker activity under the
common law regime.
conciliation: A form of mediation in which a neutral collective bargaining expert attempts to assist an employee association
(e.g., a union) and an employer or employer association in reaching a collective agreement.
PC 1003: Federal legislation that granted workers collective bargaining rights, including protection from anti-union discrimin-
ation by employers and a limited protected right to strike, and imposed on employers a legal “duty to bargain” with unions
representing a majority of workers.

Legal Treatment of Collective Worker Activities Rules in Collective Bargaining Statutes Beginning in
Rights in the Common Law Regime Before PC the Mid-1940s
1003
Right to • Employees could join worker associations. • PC 1003 introduced a statutory “right to be a member of a
join a However, an employer could refuse to hire or trade union or employees’ organization” that prohibited
union could terminate a worker who did so, because employers from refusing employment to, terminating, or
freedom of contract includes the right to discriminating against workers because of their support for
choose with whom you contract. collective bargaining (see Chapter 31).
Right to • An employer had no obligation to recognize or • PC 1003 introduced a statutory duty to bargain “in good
collective bargain with a union that claimed to represent faith,” provided that the union had been “certified” by the
bargaining its employees. government. Certification occurs once a union has satisfied
the requirements in the collective bargaining statute, which
include proving that a majority of employees wish to be
unionized (see Chapter 33).
Right to • A worker could refuse any offer of employment • PC 1003 introduced a limited, protected right to strike that
strike and and refuse to work until an acceptable offer was prohibits an employer from terminating employees for
lockout made and accepted. However, an employer the reason only that they are engaged in a strike that the
could refuse to hire any person who did not collective bargaining statute defines as lawful. A lawful
accept its offer. strike is one that occurs only after a series of statutorily
defined preconditions are satisfied.
• An individual worker who refused to work
during the term of an employment contract • Recognition strikes, strikes by non-union workers, and
either had quit or had probably given the strikes while a collective agreement was in effect remained
employer cause for summary dismissal without unlawful.
notice (see Chapter 12).
• Employers were granted a limited right to lock out workers
• If a group of workers together refused to work as a bargaining tactic, provided that a series of statutorily
for an employer, they were likely engaged in defined preconditions are satisfied (see Chapter 34).
torts such as “conspiracy to injure” the employer
or “intimidation.”
• Organizers of a strike were likely also engaged

in “conspiracy to injure” or “intimidation,” and
could also be committing the tort of “inducing
breach of contract.”
• An employer that “locked out” an employee—

refusing to allow an employee to come to
work—was committing a fundamental breach
of contract that the employee could accept as a
constructive dismissal (see Chapter 13).
Right to • Depending on the manner in which it was • Picketing was not directly addressed in PC 1003. However,
picket in conducted, picketing could be treated as a tort by the mid-1940s peaceful picketing support of a strike was
support of (i.e., nuisance, inducing breach of contract). no longer criminal. Picketing could still be tortious, depend-
a strike ing on how it was conducted.
The next major legislative moment that contributed to the expansion of collective bargain-
ing in Canada came two decades after PC 1003. Although Saskatchewan had permitted public
sector workers to unionize since the 1940s, the rest of Canada did not pass public sector collec-
tive bargaining legislation until the 1960s. Quebec extended protections for collective bargain-
ing to government employees in 1965, followed by the federal government, which enacted the
Public Service Staff Relations Act in 1967. The other provinces soon followed, paving the way for
a wave of public sector unionization beginning in the late 1960s and through the 1970s. Today,

each province in Canada and the federal government has its own legislation governing collec-
tive bargaining in the public and private sectors. While there are differences in this legislation,
there is enough similarity that it is common to hear reference to the “Canadian model” of col-
lective bargaining law. The main features of that “model” are those originally included in PC
1003 in 1944.
III. The Outputs and Legal Institutions of the Collective

Bargaining Regime
PC 1003 developed a model that fundamentally altered how the law previously governed unions
and the processes of collective bargaining, collective agreements, strikes, and lockouts. Today,
the basic principles found in PC 1003 exist in federal and provincial labour relations legislation
across Canada, such as the federal Canada Labour Code, the Ontario Labour Relations Act, and
the British Columbia Labour Relations Code.15 Labour relations boards are responsible for
interpreting and enforcing labour relations legislation. We will explore the key elements of
labour relations legislation in depth in the chapters that follow.
The “outputs” (or legal rules) produced within the collective bargaining regime include more
than just those found in labour relations legislation. For example, unions and employers (some-
times through employer associations) bargain their own legal rules that appear in collective
agreements.16 Disputes about the application and interpretation of collective agreements are
resolved by labour arbitrators, and a rich body of Canadian labour arbitration jurisprudence
exists (see Chapter 36). Judges continue to play an important albeit more limited role in the
collective bargaining regime than in the common law regime, particularly in the governance of
picketing and strikes, where the old tort laws remain important for reasons explained in
Chapter 34, and through judicial review of the decisions of arbitrators and labour relations
boards. Table 28.1 provides a quick overview of the legal institutions responsible for enforcing
the legal rules of the collective bargaining regime.
TABLE 28.1 Legal Institutions in the Collective Bargaining Regime

Legal Institution Primary Role in the Collective Bargaining Regime
Labour Relations Boards • To interpret and enforce labour relations legislation enacted by governments
Labour Arbitrators • To interpret and enforce collective agreements negotiated by unions and employers
Courts • To enforce tort law as applied to collective activities
• To provide judicial review of decisions of arbitrators and labour relations boards
lockout: A tactic whereby an employer refuses to permit employees to report to work and to pay the employees to apply
pressure on the employees and their union in collective bargaining.
labour relations boards: Expert administrative tribunals responsible for enforcing and interpreting labour relations legislation.

IV. Who Is Governed by the Collective Bargaining Regime

in Canada?
Once employees unionize, they enter a new legal world. The common law rules of employment
contracts explored in Part II of the book mostly fall by the wayside. For example, common law
doctrines like constructive dismissal and wrongful dismissal—crucial legal concepts within the
common law regime—no longer apply to an employee governed by a collective agreement and
represented by a union. Unionized employees are represented by their union in dealings with
the employer, and the collective agreement that the union bargains on behalf of employees sup-
plants any pre-existing individual employment contracts. Therefore, when employees decide to
switch from the common law regime to the collective bargaining regime by joining a union, they
are electing to fundamentally alter the legal framework that governs their relationship with the
employer.
In 2018, approximately 4.7 million Canadian employees had their terms of employment
governed by a collective agreement rather than an individual employment contract.17 That
number translates into a union coverage rate—the percentage of employees covered by a col-
lective agreement—of approximately 30.1 percent of Canadian employees (down from 34.5
percent in 1998).18 Sometimes the union density rate—measured in Canada as the percentage
of non-agricultural employees who are union members—is used to measure unionization levels
instead of union coverage rates. Union density can be lower than union coverage because some
workers who are covered by a collective agreement may not have signed union membership
cards. In Canada, the two rates tend to be similar. For example, in 2018, the union density figure
was 28.1 percent, just slightly lower than the union coverage rate of 30.1 percent.
Note that because both “union coverage” and “union density” measure the proportion of Can-
adian workers who are covered by a collective agreement and who are union members, respect-
ively, relative to the total population of employees, the figures can decline even if total union
membership is increasing. That would happen when the total number of people employed
increases at a faster rate than union coverage and union membership. For example, while union
density fell from 30.9 percent in 1997 to 28.1 percent in 2018, union membership—the number
of people who are union members—actually increased from about 3.5 million to over 4.7 mil-
lion over that same period.19 In other words, although there are more Canadians who are union
members today than ever before, the percentage of total employees who are unionized is declin-
ing. Table 28.2 presents important details about the identity of unionized workers in Canada.
TABLE 28.2 Union Representation in Canada, 2018

Total Union Coverage in Canada 30.1%
Men Covered by a Collective Agreement 27.9
Women Covered by a Collective Agreement 32.2
Union Coverage by Sector

Public 75.1
Private 15.9
union coverage rate: The percentage of employees whose employment conditions are governed by a collective agreement
bargained on their behalf by a union.
union density rate: The percentage of employees who are union members.
union membership: The number of people who are members of a union.

Union Coverage by Age

15–24 15.2
25–34 29
35–44 33.6
45–54 35
55+ 33.8
Union Coverage by Employment Status

Full time 31.5
Part time 23.6
Union Coverage by Education Level

No degree, certificate, or diploma 30.1
High school graduate, some post-secondary education 22.7
Post-secondary certificate or diploma 34.5
University degree 34
Union Coverage by Workplace Size

Under 20 employees 13.5
20–99 employees 30.4
100–500 employees 40.2
Over 500 employees 53.7
Sources: Statistics Canada, “Union Status by Establishment Size,”Table 14-10-0133-01, online:

<https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=1410013301>; Statistics Canada,
“Union Status by Geography,”Table 14-10-0129-01, online: <https://www150.statcan.gc.ca/t1/
tbl1/en/tv.action?pid=1410012901&pickMembers%5B0%5D=2.3&pickMembers%5B1%5D=3.1
&pickMembers%5B2%5D=4.6>.
The union coverage rate in the Canadian public sector is more than four times that in the
private sector. Publicly provided services such as education, health care, and public administra-
tion are highly unionized, whereas privately provided services such as retail, food services,
hospitality, and financial services have low collective agreement coverage rates. The high level
of public sector unionization has kept Canada’s overall union coverage rate (30.1 percent) high
relative to the United States, where overall union density is about 10 percent. Private sector
union coverage in Canada has experienced a downward trend since the 1980s (see Box 28.2),
which is similar to but less dramatic than that experienced in the United States, where private
sector union density sits (in 2018) at about 6 percent—approximately the same level of unioniza-
tion as existed in the early 1930s. Large workplaces are far more likely to be unionized than small
workplaces. There is also a substantial difference in union coverage across provinces. In 2018,
Alberta had the lowest union coverage rate at only 24.5 percent, while Quebec (38.4 percent)
and Newfoundland and Labrador (37.3 percent) had the highest (see Table 28.3).

TABLE 28.3 Union Coverage by Jurisdiction, 2014 – 2018

Geography 2014 2015 2016 2017 2018
Canada 30.4 30.6 30.3 30.4 30.1
Newfoundland and Labrador 37.8 37.3 37.5 38.7 37.3
Prince Edward Island 32.3 34.1 31.5 31.3 32.0
Nova Scotia 30.8 30.9 31.0 30.2 29.7
New Brunswick 28.6 29.3 28.1 29.0 29.8
Quebec 39.3 39.4 38.6 38.4 38.4
Ontario 27.0 26.8 26.7 26.8 26.3
Manitoba 35.4 35.9 35.1 34.5 34.2
Saskatchewan 33.3 33.2 32.6 32.9 33.5
Alberta 22.1 23.5 24.9 25.0 24.5
British Columbia 30.0 30.3 28.9 29.7 29.1
Source: Statistics Canada, “Union Status by Geography,”Table 14-10-0129-01, online: <https://www150.statcan.gc.ca/t1/tbl1/en/tv.action

?pid=1410012901&pickMembers%5B0%5D=2.3&pickMembers%5B1%5D=3.1&pickMembers%5B2%5D=4.6>.
Since 2004, a greater percentage of women (32.2 percent compared to 27.9 percent men) have
been in unions than men, as depicted in Figure 28.2. The typical unionized employee in Canada
today is a woman working in public services, a sharp contrast to earlier eras in which union
members were overwhelmingly male and employed in sectors such as manufacturing, mining,
construction, and forestry.20
FIGURE 28.2 Union Membership in Canada by Gender, 1981 – 2018
45
Men
Both sexes
Women
Membership (percentage)
40
35
30
25
1981 1984 1987 1990 1993 1996 1999 2002 2005 2008 2011 2014 2018
Year

As noted above, unionization in the private sector has experienced a steady decline over the
past few decades. This is due to a variety of forces that are discussed in Box 28.2. Whether the
fall in private sector union representation is a good or bad trend is a matter of perspective (see
Chapter 3). However, the question of whether governments should be reforming our collective
bargaining laws with the aim of expanding private sector collective bargaining has been hotly
debated in political elections and policy debates for decades. We will explore these debates
throughout the rest of this text.

The Decline in Private Sector Union Coverage in Canada
While unionization in the public sector has held strong (about Structural changes in the Canadian economy—in the eco-
75 percent of public sector employees are unionized), since nomic and market subsystem (Chapter 2)—over the past four
the 1980s there has been a slow and steady decline in the decades are an important part of the story as well. “Structural
percentage of private sector workers represented by unions changes” include shifts away from heavily unionized sectors
in Canada, as demonstrated in the figure below. Private toward sectors with lower union representation levels. There
sector unionization has decreased from about 26 percent in has been a shift in the composition of the Canadian workforce
1984 to about 16 percent today. Changes to collective from traditionally heavily unionized sectors of the economy
bargaining laws designed to discourage the spread of collec- (manufacturing especially) toward less unionized sectors (pri-
tive bargaining provide part of the explanation for this vate services) and public sector employment (which is heavily
decline. Provincial governments inspired by the neoclassical unionized).† Between 1984 and 2018, the share of Canadians
perspective (see Chapter 3) introduced laws that made it employed in manufacturing declined from 16.9 percent to 9.2
more difficult for unions to organize new workers.* We percent.‡ At the same time, employment in public services such
will examine some of the ways that labour laws influence as health care grew substantially. Many of those public sector
unionization levels in the coming chapters. However, jobs are unionized, which explains why the public sector union-
legislative changes within the collective bargaining regime ization rate has remained strong. However, as the labour force
explain only part of the decline in private sector union trends away from industries with traditionally high levels of
representation. union penetration, union representation levels decline.
80
70
Public
60 All Employees
Density (percentage)
Private
50
40
30
20
10
0
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Year
Source: Armine Yalnizyan, Senior Economist, Canadian Centre for Policy Alternatives, based on Statistics
Canada data from CANSIM 282-0078; Statistics Canada, “Union Status by Industry,”Table 14-10-0132-01,
online: <https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=1410013201>.

There have also been structural changes within sectors, Procedures: Evidence from British Columbia, 1978 – 1998” (2004) 57
Indus Lab Rel Rev 493.
from unionized workplaces to non-unionized workplaces.§ For
† D. Galarneau & T. Sohn, Long Term Trends in Unionization (Ottawa, ON:
example, since the 1980s Canada has lost thousands of union-
Statistics Canada, 2012), online: <http://www.statcan.gc.ca/pub/
ized manufacturing jobs, aided by “free trade” agreements that 75-006-x/2013001/article/11878-eng.htm>; G. Murray, “Unions:
encouraged corporations to shed Canadian manufacturing Membership, Structures, Actions, and Challenges” in M. Gunderson & D.
jobs in favour of lower wage and regulation jurisdictions (see Taras, eds, Canadian Labour and Employment Relations, 6th ed (Toronto,
Chapter 27). Although new manufacturing jobs were created, ON: Pearson, 2009) 74 at 83; and Statistics Canada, “Union Status by
Industry,” Table 14-10-0132-01, online: <https://www150.statcan.gc.ca/
fewer of them have been unionized. The unionization rate in t1/tbl1/en/tv.action?pid=1410013201>.
manufacturing fell from 31.2 percent in 1999 to 24.7 percent ‡ Galarneau & Sohn, supra note †; and Murray, supra note † at 83.
in 2018.# Unionization levels also fell in other traditionally § A. Jackson & S. Schetagne, “Solidarity Forever? An Analysis of Changes in
heavily unionized sectors, including forestry, mining, and Union Density” (Summer 2004) 4 Just Labour 53 at 58, online (pdf ):
construction. <http://www.yorku.ca/julabour/volume4/Jacksonschetagne.pdf>.
# Ibid.; and R. Morissette, G. Schellenberg, & A. Johnson, “Diverging Trends
* S. Slinn, “An Empirical Analysis of the Effects of the Change from Card-
in Unionization” (2005) 6:4 Persp Lab & Income, online: <http://www
Check to Mandatory Vote Certification” (2004) 11 CLELJ 259; and C.
.statcan.gc.ca/pub/75-001-x/10405/7827-eng.htm>.
Riddell, “Union Certification Success Under Voting Versus Card-Check
V. Canadian Unions Today: A Snapshot

Canada’s close historical, cultural, and economic ties to the United States led US-based “inter-
national unions” to play a key role in the establishment and early development of Canadian
unions. Indeed, many of the largest and oldest private sector unions in Canada began as affiliates
of much larger US unions, including Unifor (which was known as the Canadian Auto Workers
from the time it split with the US-based United Auto Workers in 1985 until 2013),21 the United
Steelworkers Union, and the United Food and Commercial Workers (UFCW). With their larger
size and earlier development, US unions provided an attractive option for Canadian workers
with few alternatives. However, since the 1970s, many Canadian unions have seceded from their
US parent unions, sometimes complaining of a lack of attention or interference from the US
leadership. In addition, growing Canadian patriotism and a widening cultural and political gap
between Canada and the United States contributed to what is now a strong national labour
movement in Canada. As a result, the proportion of international union membership declined
from more than 70 percent in the mid-1960s to its current level of 5.2 percent.22
The spread of collective bargaining in the public sector during the 1960s and 1970s brought
national (exclusively Canadian) unions to the fore, as international unions were seldom active
among Canadian public employees. Today, the largest unions in Canada represent public sector
employees, including the Canadian Union of Public Employees (CUPE) and the National Union
of Public and General Employees (NUPGE), as well as many large provincial public sector
unions, such as the Ontario Public Sector Employees Union (OPSEU).
Most unionized workers in Canada belong to local unions, which operate like branches or
divisions of a larger parent union. Local union members usually elect their local union leader-
ship. For example, Local 222 of Unifor represents workers at General Motors’ factories in and
around Oshawa, Ontario, as well as other workplaces in that geographic area. Unifor’s national
head office (the parent union) provides a variety of services to its locals, including negotiating
assistance, legal and economic services, training and development, and help with organizing
international unions: A union that represents workers in more than one country.
local union: A local branch of a union; it is part of and chartered by a parent union.
parent union: A larger umbrella organization made up of smaller local unions. It provides service to its member local unions,
such as training of local union representatives, maintaining strike funds, and providing collective bargaining support and legal
expertise.

new union members. The largest parent unions in Canada are listed in Table 28.4. Parent unions
often supply professional service or union business representatives to local unions, who work
with the employer and local union stewards and other local union officials to negotiate and
enforce collective agreements, although larger local unions may employ their own professionals
to perform these services. As we will learn in Chapter 36, disputes arising under collective agree-
ments are dealt with through grievance procedures found in the agreements and are litigated
before labour arbitration tribunals rather than courts. A union’s business representative, union
steward, or other local union official (like a local union president) may present a grievance at
arbitration, or the union may use a labour lawyer. Similarly, an employer may use a senior
human resources or labour relations manager to present arbitrations, or more frequently they
hire labour lawyers.
TABLE 28.4 The Largest Parent Unions in Canada

Number of Members
Union (2015)
Canadian Union of Public Employees (CUPE) 635,500
National Union of Public and General Employees (NUPGE) 360,000
Unifor 300,152
United Food and Commercial Workers Canada (UFCW) 247,543
United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers 190,452
International Union (USW)
Public Service Alliance of Canada (PSAC) 181,017
Fédération de la santé et des services sociaux (FSSS) 135,527
Source: Statistics Canada, “Labour Organizations in Canada 2015,” Appendix 5, online:

<http://www.labour.gc.ca/eng/resources/info/publications/union_coverage/union_coverage.shtml>.
Most Canadian unions have affiliated with a central union confederation that provides rep-
resentation at the provincial or national level. Approximately 81 percent of all union members
in Canada belong to a union that has affiliated with a central labour congress.23 The largest and
most important national confederation is the Canadian Labour Congress (CLC), which repre-
sents 69 percent of all Canadian union members.24 The next largest, at only 6.9 percent, is the
Quebec-based Confédération des syndicats nationaux. There are also provincial union federa-
tions in every province that advocate for unions at the provincial level, such as the Ontario
Federation of Labour and the BC Federation of Labour.
union business representative: An employee of a union whose job includes assisting local unions in the negotiation of
collective agreements and administration and enforcement of collective agreements.
union steward: A representative of a union in a workplace, often elected by employees in that workplace, who is responsible
for representing employees in day-to-day concerns about working conditions and collective agreement administration.
grievance procedure: A provision of the collective agreement that explains when and how a grievance alleging a breach of
the agreement can be filed and what process will be used to mediate the grievance and, if not resolved, to refer the grievance to
binding labour arbitration. A grievance procedure usually includes several “steps,” with the final step being referral to arbitration.
Canadian Labour Congress (CLC): The largest federal confederation of unions in Canada, representing 3 million Canadians.
Its main roles are to lobby governments, provide leadership on key issues, and provide training and education resources for its
member unions. It holds a national convention every three years.

The CLC serves a number of important functions for the Canadian labour movement. First,
it advocates and lobbies for legislative and policy initiatives at the national level, especially for
things it believes benefit union members and Canadian working people in general. Second, the
CLC provides a variety of educational and other supports to affiliate unions, especially smaller
ones that lack resources. Third, it represents the interests of the Canadian labour movement in
the international arena, such as at the International Labour Organization. Fourth, the CLC
attempts to regulate and limit inter-union conflict. In particular, the CLC had adopted a policy
relating to union raiding, which occurs when one union seeks to displace another union as the
representative of a group of workers. Unions affiliated with the CLC are expected to not “raid”
other CLC affiliates. However, the CLC has no legal authority to sanction a union that violates
this pact, and in recent years there have been some high-profile disputes relating to alleged
union raiding. The media story in Box 28.3 describes the recent decision of Unifor, Canada’s
largest private sector union, to leave the CLC following a dispute about the CLC’s raiding rules.

Canadian Labour Congress Accuses Unifor of Leaving to Raid Another Union
The head of the Canadian Labour Congress is accusing Unifor For U.S. organizations, there’s financial incentive to keep
of raiding another union for members after it severed ties with Canadians in their unions, said Dias. “Canada is a major cash
the national lobby group for the country’s labour movement. cow,” he said. “So there is one heck of a push amongst the
Unite Here Local 75, which represents hundreds of hotel U.S.-based unions to ensure that their members can never
workers in Toronto and Mississauga, announced Thursday leave their union.”
night it is seeking to leave its U.S.-based parent union and join Unite Here Local 75 outlined several frustrations with its
Unifor. The move came a day after Canada’s largest private parent Unite Here when announcing the vote to switch unions.
sector union split from the CLC over concerns including what It said Unite Here put the local into trusteeship in January,
it says are some U.S.-based unions stifling workers’ rights to removed elected officials and seized the local unit’s assets. But
change the group representing them. international unions have been a part of Canada’s labour
“Since the disaffiliation, they are now involved in raiding movement since the start, said Christopher Monette, a spokes-
Unite Here in Toronto,” CLC president Hassan Yussuff said. It’s man for Teamsters Canada—a CLC affiliate. The union repre-
against the rules for affiliates to solicit the members of another sents more than 125,000 members and is affiliated with the
affiliate to join their union, he explained. Washington, D.C.-based International Brotherhood of
“But, if you leave the congress, then, of course, you’re free Teamsters.
to go and solicit any members that they wish to join their “We don’t feel concerned by these accusations and charges
union. And that’s what they’re doing right now.” from Unifor,” said Monette, calling Unifor’s reasoning “spin.”
However, Unifor president Jerry Dias insists Unifor’s deci- “They’re leaving because the CLC does not allow their
sion to leave the CLC was not about boosting its membership affiliates to openly go out and raid other unions,” he said.
and denied the accusation that he was raiding another union. Yussuff disagreed with Dias’s assertions that the CLC has
“I have zero interest in raiding any unions. We will respond failed to act on member complaints, adding its received 46
to those that attempt to raid us, but this has absolutely nothing complaints between May and December last year and all have
to do with raiding,” he said. Dias said the CLC rules that give been resolved. The group can’t address complaints it doesn’t
disgruntled unionized workers an avenue to choose different receive, he added.
representation don’t work, particularly because U.S.-based If Unifor has issues with the group’s constitution, Yussuff
unions that are also part of the CLC don’t want them to be said, the union should have worked within the system to build
effective. a consensus around how to improve the structure. “Leaving
Among the CLC’s 65 members, there are 33 international and interfering in the relationship with other affiliates is not
unions. The Air Line Pilots Association International, for ex- a way to demonstrate your solidarity,” he said.
ample, is an affiliate that represents pilots at airlines in both
the U.S. and Canada. While unionization rates have fallen in Source: “CLC Accuses Unifor of Leaving Lobby Group to Raid Another
Canada, the drop in the United States has been even larger. Union,” CBC News (January 2018), online: <https://www.cbc.ca/news/
business/clc-union-unifor-workers-1.4495389>.
union raid: An attempt by one union to organize workers who are represented by another union.

VI. Chapter Summary

This chapter explained how the collective bargaining regime and laws that inhabit it should be
understood against the historical backdrop of how collective worker activities were treated
within the common law regime over many years. Many of the legal rules we will explore in the
chapters that follow represent government attempts to alter the common law approach, which
was hostile to unions and collective worker activities, or otherwise to control worker militancy.
PC 1003, introduced by the federal government in 1944, marked a definitive moment in the
development of the modern collective bargaining model that we will explore in the coming
chapters.
Today, approximately one-third of Canadian employees have their terms and conditions of
employment set through collective bargaining and collective agreements rather than individual
employment contracts. We examined some characteristics of Canadians who are unionized
today and noted that collective bargaining is more common in the public sector, in large work-
places, and among older workers and women. Finally, we examined the basic structure of Can-
adian unions and how they function. In the chapters that follow, we will dive deeper into many
of these subjects.

1. Describe how collective bargaining legislation created new legal rights to protect workers
who joined unions that did not exist in the common law regime.
2. Identify the three main legal institutions within the collective bargaining regime and
explain what role they play.
3. What factors have contributed to the overall decline in union coverage in the private sector
over the past 30 years in Canada?
4. What explains the spike in union membership numbers during the two World Wars of the
twentieth century?
5. What are the key functions of the Canadian Labour Congress?
EXERCISES
1. Go to a search engine such as Google. Type “Canada” and “the decline of unions.”
2. Select a news article from the search results, read it carefully, and answer the following
questions:
a. What is the story about?
b. Does the story cite any statistics about union representation in Canada?
c. Does the story argue or propose that the decline of unions is a positive or negative de-
velopment for the Canadian economy? For workers? For employers?
d. Does the article provide any reasons why unions are in decline?
e. Does the article describe any legal rules that either have contributed to the decline of
unions in Canada or could help rejuvenate unions in Canada’s private sector?

1. B. Langille, “Labour Policy in Canada—New Platform, 3. See J. Fudge & E. Tucker, Labour Before the Law: The Regu-
New Paradigm” (2002) 28 Can Pub Pol’y 133. lation of Workers’ Collective Action in Canada, 1900 – 1948
2. For a discussion of the common law’s treatment of union (Toronto, ON: Oxford University Press, 2001) at 168-69;
organizing and collective bargaining, see B. Langille, “The and S. Hanson, “Estevan 1931,” in I. Aella, ed, On Strike:
Freedom of Association Mess: How We Got into It and How Six Key Labour Struggles in Canada, 1919 – 1949 (Toronto,
We Can Get out of It” (2009) 54 McGill LJ 177 at 188-93. ON: Lorimer, 1974) 33.

4. In Quinn v. Leathem, [1901] AC 495 (HL), the tort of con- company-sponsored employee association known as the
spiracy to injure was decided; in Rookes v. Barnard, [1964] Proactive Communication Team (PACT), which negotiates
AC 1129, the tort of intimidation was committed when agreements with the employer. Non-union employee asso-
workers threatened to strike (i.e., to breach their employ- ciations are usually not covered by labour relations legisla-
ment contracts). tion applicable to unions, and employees in those
5. J. T. Stratford & Sons Ltd. v. Lindley, [1965] AC 269. For a associations continue to be governed by the common law
discussion of the application of torts to restrict collective regime’s rules of employment contracts. See D. Doorey,
worker activities, see Labour Law Casebook Group, “Union Drive at WestJet Highlights Current Tensions in
Labour and Employment Law: Cases, Materials, and Com- Labour Policy,” Globe and Mail (August 2015), online:
mentary, 8th ed (Toronto, ON: Irwin, 2011) at 418-22; <http://www.theglobeandmail.com/report-on-business/
Fudge & Tucker, supra note 3; and H. Arthurs, “Labour rob-commentary/union-drive-at-westjet-highlights
Law—Secondary Picketing—Per Se Illegality—Public -current-tensions-in-labour-policy/article25865172>; and
Policy” (1963) 41 Can Bar Rev 573. D. Taras & B. Kaufman, “Non-Union Employee Represen-
tation in North America: Diversity, Controversy, and
6. Criminal Code, RSC 1985, c. C-46; and Fudge & Tucker,
Uncertain Future” (2006) 37:5 Indus Rel J 513.
supra note 3 at 25.
17. Statistics Canada, “Union Status by Industry,” Table 14-10-
7. H. Arthurs, “Tort Liability for Strikes in Canada: Some
0132-01, online: <https://www150.statcan.gc.ca/t1/tbl1/en/
Problems of Judicial Workmanship” (1960) 38 Can Bar
tv.action?pid=1410013201&pickMembers%5B0%5D=2.2&
Rev 346; B. Laskin, “Picketing: A Comparison of Certain
pickMembers%5B1%5D=4.1>
Canadian and American Doctrines” (1937) 15 Can Bar
Rev 10; and K. Wedderburn, “Strike Law and the Labour 18. Ibid.
Injunction: The British Experience, 1850 – 1966” in A.W.R. 19. Statistics Canada, “Union Status by Geography,” Table
Carrothers, ed, Report of a Study on the Labour Injunction 14-10-0129-01, online: <https://www150.statcan.gc.ca/t1/
in Ontario, vol. 2 (Toronto, ON: Ontario Department of tbl1/en/tv.action?pid=1410012901&pickMembers%5B0%5
Labour, 1966). D=2.3&pickMembers%5B1%5D=3.1&pickMembers%5B2
8. McGavin Toastmaster Ltd. v. Ainscough, [1976] 1 SCR 718 %5D=4.6 (you can adjust the settings to provide statistics
at 8-9. on union density and union membership from 1997 to
2018).
9. See Fudge and Tucker, supra note 3 at 2.
20. See A. Jackson & S. Schetagne, “Solidarity Forever? An
10. Orchard v. Tunney, [1957] SCR 436.
Analysis of Changes in Union Density” (Summer 2004) 4
11. H. Arthurs, “The Right to Golf: Reflections on the Future Just Labour 53, online (pdf): <http://www.yorku.ca/
of Workers, Unions, and the Rest of Us Under the Charter” julabour/volume4/Jacksonschetagne.pdf> for a discussion
(1988) 13 Queen’s LJ 17 at 18. of changes in representation over time. See also “How
12. See, for example, the Industrial Disputes Investigation Act, Canadian Unions Are Changing,” CBC News (March
SC 1907, c. 20. 2012), online: <http://www.cbc.ca/news2/interactives/
13. That legislation remains in effect as the Rights of Labour labour-demographics>.
Act, RSO 1990, c. R33, s. 3(1). On the Criminal Code 21. A fascinating National Film Board of Canada documen-
amendments, see Fudge & Tucker, supra note 3 at 165-66. tary, Final Offer, explores the split between the US-based
14. Wartime Labour Relations Order PC 1003 is available at United Auto Workers and its Canadian affiliate, which
<https://en.wikisource.org/wiki/Wartime_Labour would become known as the Canadian Auto Workers
_Relations_Regulations>. Union, or CAW, after the divorce. The film is available for
free viewing at <https://youtu.be/JYNwc0KuGTc>.
15. Canada Labour Code, RSC 1985, c. L-2; Ontario’s Labour
Relations Act, 1995, SO 1995, c. 1, Sched. A; and BC’s 22. See Statistics Canada, “Labour Organizations in Canada
Labour Relations Code, RSBC 1996, c. 244. 2015,” online: <https://www.canada.ca/en/employment
-social-development/services/collective-bargaining-data/
16. Unions are the most common type of employee associa- reports/union-coverage.html>.
tion. However, many workers are also represented by non-
union forms of employee associations. For example, 23. Ibid.
employees at WestJet Airlines are represented by a 24. Ibid.

CHAPTER 29
A Brief History of
Labour and the Law*
II. The Emerging Labour Movement: 1860s to 1910 476
• Describe several key events in Canadian labour
A. Craft Unionism 476
movement history and explain their significance.
B. Early Legislation Restricting Unions and Collective Worker Action: Pre-1870s 477
• Understand the early relationship between C. Early Legislation Regulating and Legitimizing Union Activity:
workers and employers. 1870s and Beyond 479
• Describe the early statutes and common law used D. Employer Intransigence and Increasing Worker Militancy 481
to regulate collective worker action. E. Industrial Disputes Investigations Act, 1907 482
• Describe the main features of the Wagner model III. Labour in the Early 20th Century and the Interwar Years 482
and the Rand Formula. A. The Great Depression and the Wagner Act 484
B. Oshawa General Motors Strike, 1937 485
IV. The Foundations of the Modern Collective Bargaining Model:
PC 1003 and the “Rand Formula” (1940s) 486
A. PC 1003 (1944): The Wagner Model Comes to Canada 486
B. The Rand Formula 487
V. Public Sector Collective Bargaining 488
I. Introduction
Canada has one of the most highly juridical collective bargaining regimes in the world. That
means that it has a complex system of laws that regulates how unions obtain the right to repre-
sent employees (see Chapter 31), the conditions that must be met for unions to enter into bar-
gaining relationships with employers, what unions and employers may and may not do during
the course of negotiations (Chapters 32 and 33), and what happens if a union and an employer
reach an impasse such that they cannot come to an agreement (Chapter 34). This system of laws
was not always in place, however.
The history of the collective bargaining regime is the story of how workers, generally faced
with harsh working conditions and intransigent employers, agitated collectively to better their
lot, and how the government and courts responded to this agitation. This chapter will briefly
review the main events in Canadian labour movement history that propelled the gradual exten-
sion of legal rights and obligations of unions, from the emergence of industrial society in the
mid-19th century to the adoption of the Wagner model in Canada, first among private sector
unions in the 1940s, and its extension to public sector workers in the 1960s and 1970s.
* This chapter was authored by Alison Braley-Rattai, Brock University.
475

II. The Emerging Labour Movement: 1860s to 1910

The first recognized collective labour action in what is now Canada was thought to have
occurred as far back as 1794, when employees of the North-West Fur Trading Company went
on strike for better wages. However, it does not make sense to speak of a labour movement until
the dawn of Canadian industrialization, some five decades later. The labour movement is char-
acterized by a series of increasingly coordinated actions on the part of workers in many different
occupations who gradually became aware of their common interests as workers who were facing
similar problems and frustrations.
Therefore, even though workers engaged in collective action to protect their interests
throughout the 19th century as production processes slowly began to change, it was not until
about the second half of that century that a discernible labour movement emerged. The develop-
ment of the labour movement, however, was far from even or linear.1 For the most part, every
action taken by workers was met with strong—often violent—resistance, from both employers
and the state.
A. Craft Unionism

The Industrial Revolution that began in Britain in the middle of the 18th century did not arrive
in Canada for another 100 years. Until about 1850, Canada was still pre-industrial. Most house-
holds lived an agrarian life and produced for themselves what goods they needed. Canada’s
exports were primary resources: predominantly fish, fur, timber, and wheat.2 There were artisans
who produced goods, but as most households were self-sufficient and most people did not work
for wages except sporadically, the market for consumer goods was small.
What artisans there were produced items consistent with the master and servant framework
discussed in Chapter 5. As part of the master and servant regime, young boys were oftentimes
indentured to a particular master craftsman who would take them on as apprentices. The
craftsman would teach his craft to the apprentice, who would go through stages of aptitude—
journeyman, and then a master craftsman in his own right. A master craftsman would set up
his own shop and hire an apprentice, and the cycle would repeat. What characterized the craft
era for craftsmen was a strong attachment to the craft itself: pride in the workmanship required,
and pride at having a particular skill that others did not possess. Although apprentices were not
always treated kindly, and working conditions were often harsh, there nevertheless existed a
mutuality between the interests of master craftsmen and journeymen who hoped eventually to
become master craftsmen themselves.3
Gradually, however, production methods began to change. As full-fledged industrial society
began to emerge during the late 19th century, the mutuality of interests between master crafts-
men and their journeymen blurred. Some master craftsmen began to run their shops in line
with the large-scale “manufactories” that were the hallmark of early industrialization.4 The eco-
nomic insecurity that attended the changed production processes prompted craftsmen to de-
velop what were known as “friendly societies.” Initially, these societies were developed to act as
labour movement: A general term for the collective organization of working people and their organizations that evolved to
campaign for improved terms and conditions at work and to contest and challenge various aspects of advanced capitalist society,
particularly with regard to social relations of work.
master craftsman: A craftsworker who has attained the highest level of aptitude.
apprentice: A worker who is learning a trade or craft under the guidance and supervision of a senior skilled worker in the field.
journeyman: A worker who has completed an official apprenticeship in a craft or skill and who is thus qualified to work in
that field, under the supervision of a master craftsman.

Chapter 29 A Brief History of Labour and the Law 477
a benefit fund in times of members’ need, such as for illness and death. Eventually, though, they
evolved into the early craft unions that would represent workers’ interests to their employers.
These friendly societies were craft specific, unlike later industrial unions, which would try to
organize labour across occupational lines.
Thus, the first unions in Canada arose to maintain the integrity of the craft system against the
onslaught of mechanization. Unlike many of the more militant industrial unions that emerged
later, and which will be discussed below, the craft unions did not generally seek to overthrow
the impending order. They sought, principally, to assure their privileged place within it; they
sought to maintain the respectability of the middle-class life their status had previously earned
them.
Employers generally refused to recognize these early craft unions, however, and often refused
to negotiate with them. The only power unions had at this time was the economic power of the
strike. Workers could collectively withhold their labour to apply pressure on the employer to
acquiesce to the union’s demands. However, if an employer could withstand the strike (e.g., by
hiring replacement workers, commonly—and derisively—described as “scabs” by union mem-
bers), then the employer need not ever deal with the union. No legal mechanism existed at this
time to force the employer to recognize or negotiate with the craft union. As a general rule, the
law was commonly used against unions and workers who engaged in collective action to
improve working conditions.
B. Early Legislation Restricting Unions and Collective Worker

Action: Pre-1870s
Sometimes government legislation explicitly banned collective worker action, such as organ-
izing (“combining”), attempting to negotiate collectively, striking, and picketing. Many ex-
amples of such legislation existed in English law. For example, the English Combinations Acts of
1799 and 1800 outlawed unions (“combinations”) and thus all collective worker action. That
legislation was repealed in England in the early 1820s and was never in effect in Canada.5 How-
ever, some early Canadian legislation restricted worker combinations aimed at improving work-
ing terms. For example, the Master and Servant Act6 of 1847, for what was then the Province of
Canada (consisting of parts of modern-day Ontario and Quebec), made it illegal for workers to
combine for the purpose of demanding “high or extravagant wages,” to breach their employ-
ment contracts by refusing to work, and to induce other employees to do the same.7 Similar
legislation existed elsewhere, such as in Nova Scotia.8
craft union: A union that organizes workers according to their particular skill or trade (such as bricklayers and carpenters) rather
than according to their industry. Craft unions first emerged in Canada in the early to mid-19th century. See also industrial union.
industrial union: An organizing ethos in which all workers in a given industry are organized into the same union, regardless
of their particular skill or job category. See also craft union.
replacement worker: A person who is employed to take the place of another worker who is on strike or locked out. See
also scab.
scab: A term used to refer to a worker who would otherwise be on strike, but who refuses to strike and instead crosses the
picket line. Sometimes “scab” is used to refer generally to any person who crosses a picket line to perform work normally done
by workers on strike, including a replacement worker. See also strikebreaker.
picketing: A form of protest usually associated with a labour strike, wherein striking workers congregate outside an establish-
ment, usually their place of work, to draw attention to their situation, to dissuade others from “scabbing,” and to provide mutual
solidarity and support.

TABLE 29.1 Key Moments in Canadian Collective Bargaining Law History

Key Legislation Year Significance
Trade Unions Act 1872 Eliminated the crime of criminal conspiracy in restraint of trade as
applied to workers who come together for purposes related to working
conditions. Therefore, striking was no longer a criminal offence. The
legislation only applied to unions that “registered” with the government,
and few, if any, did.
Criminal Law Amend- 1872 Removed criminal sanctions for peaceful withdrawals of labour but
ment Act introduced the crime of “watching and besetting” into the Criminal Code,
which when interpreted broadly applied to a wide array of labour
picketing.
Breaches of Contract 1877 Repealed provisions in the Criminal Code that had rendered breach of an
Act employment contact a criminal offence.
Industrial Disputes 1907 Introduced, in certain industries, compulsory “conciliation” with a govern-
Investigations Act ment-appointed conciliator and a mandatory “cooling off” period before
workers could strike. Both of these requirements would become distinc-
tive elements of the Canadian collective bargaining model.
Wartime Labour 1944 Foundational collective bargaining legislation modelled after the Wagner
Relations Regulation, Act (1935) in the United States. PC 1003 included protections for workers
Order in Council “PC against anti-union discrimination by employers, a union “certification”
1003” system by which a union obtains a legal right to represent all workers in a
bargaining unit if it can demonstrate that a majority of those workers
want representation, a legal “duty to bargain in good faith” imposed on
employers once a union is certified, and a protected right to strike and to
lock out employees provided certain pre-conditions are satisfied. After
World War II, all jurisdictions in Canada adopted legislation modelled
after PC 1003.
“Rand Formula” 1946 A decision of Justice Ivan Rand in a collective bargaining dispute
between the UAW and Ford adopted the position that all workers cov-
ered by a collective agreement should be required to contribute their fair
share of union dues since all workers receive the benefit of the union’s
work. Rand declined to include a clause requiring all workers to become
union members. This decision serves as a basis for later legislation in
Canada that either permits or requires mandatory union dues check-off
clauses in collective agreements.
Public Sector Staff 1967 Federal legislation granting collective bargaining rights to public sector
Relations Act employees. Until this point, only Saskatchewan and Quebec permitted
collective bargaining in the public sector. Afterwards, all of the remaining
provinces introduced legislation permitting public sector collective
bargaining.
The Criminal Code9 also played a role in restricting unions and collective worker action.
Numerous criminal law provisions protected public order and property. As well, charges for
criminal conspiracy could be invoked for a variety of legal wrongs collectively undertaken. In
this regard, the sweeping common law doctrine known as restraint of trade, which dates back
to 15th-century English courts, could be invoked to restrain many collective worker activities
restraint of trade: An English common law doctrine dating from the 1400s, which states that action or contracts that restrain
trade are presumptively non-enforceable or illegal.

intended to pressure employers for higher wages. The extent to which workers were successfully
prosecuted for criminal conspiracy in restraint of trade, however, is uncertain.10 There appears
to have been divergent legal opinions as to the legality of unions at this time in Canada.11 In
1872, a coordinated effort to bring about shorter working days would result in Canada’s first
legislation to formally legalize unions and to exempt them from common law criminal con-
spiracy charges associated with restraint of trade. See Table 29.1 for a snapshot of significant
historical legislation that helped to shape the Canadian collective bargaining model in effect
today.
C. Early Legislation Regulating and Legitimizing Union Activity:

1870s and Beyond
Notwithstanding the hostility that unions faced at the hands of both employers and the legal
establishment, workers continued to organize to better their work situations. During the 1860s
and early 1870s, workers agitated for a shortened workday. In 1872, this demand was formally
expressed in the context of so-called Nine-Hour Leagues that sprang up in various cities and
towns. The leagues held public meetings extolling the social virtues of the nine-hour workday:
it would permit workers more time to become active in their communities, to become more
educated about important civic matters, and to spend more time with their families.12
There was no legislation restricting the number of hours in a day a worker could be made to
work, and employers were generally unreceptive to the idea of the nine-hour workday. Thus,
workers had to use their collective power to force employers to accede to their demands. The
various leagues coordinated a series of general strikes that would roll across several major cities
beginning in May 1872. However, the Toronto Typographical Union jumped the gun when they
went on strike in March of that year against the Globe, then owned by George Brown, one of the
Fathers of Confederation.
Brown had the strike leaders arrested and charged with criminal conspiracy. Magistrate
McNabb relied on the presumptive illegality of unions as being in restraint of trade.13 A second
hearing was ordered, but it never occurred because in the meantime, and in response to public
disapproval of the treatment of the striking Globe workers, then Prime Minister John A. Mac-
donald passed the Trade Unions Act14 of 1872 and An Act to amend the Criminal Law relating to
Violence, Threats and Molestation (Criminal Law Amendment Act).15 Together, these statutes
conferred legal credibility on unions and their central activities.
If there was any doubt as to the legal status of trade unions and their central activities—
namely, attempting to negotiate collectively and to strike—the Trade Unions Act and the Crim-
inal Law Amendment Act were aimed at rectifying that uncertainty. Among other things, the
Trade Unions Act removed all criminal sanctions against union membership by providing that
union members could not be prosecuted for criminal conspiracy on the basis only that a pur-
pose of the union was to restrain trade.16 The Criminal Law Amendment Act removed criminal
penalties attached to work stoppages if the strike was peaceful and did not restrict the employer
from operating the business. However, the provisions of these two acts were less protective of
collective worker action than they may have appeared. First, the Trade Unions Act only applied
to those unions that chose to register with the government17—a precursor of the present certi-
fication process. Few, if any, unions chose to do so. And while the Criminal Law Amendment Act
Nine-Hour Leagues: Organizations active in the late 19th century that attempted to pressure and persuade employers and
governments to implement a mandatory maximum nine-hour workday.
general strike: A strike that includes a large number of all workers in a given geographical region and across many indus-
tries. A general strike is distinct from a local strike, in which workers in a particular bargaining unit strike during the course of
negotiating a collective agreement.

eliminated some of the criminal elements tied to collective worker actions, it added others. In
particular, it was now a crime to “watch and beset,” which was often interpreted to include pick-
eting by strikers designed to dissuade people from crossing a picket line.18 When applied
broadly by the courts, this provision undercut the power of strike action by rendering unlawful
virtually all peaceful picketing. The labour movement particularly disliked the Criminal Law
Amendment Act, calling it “harsh and oppressive.”19
Where legislation did not outlaw collective action, the common law often did. The mere acts
of unionizing (combining) and striking (refusing to work) were rarely ruled illegal in them-
selves.20 However, judges developed a variety of torts (see Chapter 16 and Chapter 34) to, in the
words of labour law historians Judy Fudge and Eric Tucker, “protect employers against the kind
of harm that strikes were aimed to cause.”21 For example, if striking workers or union leaders
attempted to persuade other workers to join the strike or to not cross a picket line, they were
committing the tort of “inducing breach of contract.” Picketers who obstructed the ingress or
egress of an employer’s property could be committing the tort of “nuisance,” and picketers who
stood on private property could be committing the tort of “trespass to property.”
As the case in Box 29.1 indicates, since workers had little more than their collective efforts to
aid them to achieve their goals, an inability to persuade others to join them seriously undercut
their efficacy.

Strike at Krug Furniture
Krug Furniture Co. v. Berlin Union of Amalgamated Decision: Yes. Justice Meredith ruled that the union and its
Woodworkers members were guilty of the crime of “watching and besetting”
[1903] OJ No. 202 (QL) as well as various tortious wrongs. The crime of watching and
besetting appears to have been made out simply because the
Key Facts: In August 1902, the Amalgamated Woodworkers’ purpose of the picketing was “preventing new workmen from
International Union passed a resolution ordering a strike of work- entering the plaintiffs’ employment, and of constraining their
ers known as “finishers” at a factory of Krug Furniture in Berlin continuing workmen to leave such employment.”
(now Kitchener), Ontario. About two weeks later, the woodwork- Additionally, the union and striking workers were found
ers at Krug Furniture also ceased work in a sympathy strike with liable for the tort against inducement to breach contract,
the finishers. Union members kept a vigil, on both the trains and something which the government had ceased to view as a
the factory, with a view to preventing new workers from taking crime but which remained tortious under the common law.
up work left by the striking workers and to entice those who Finally, opining that some forms of boycotting were “very
continued to work to cease to do so. Additionally, union mem- obnoxious to the law,” Justice Meredith found the union and
bers had discovered the destination of furniture made by the striking workers liable for intimidation for the attempted boy-
company with a view to organizing a boycott of these goods. cott. The court concluded that “the result has, in one case at
The company filed for an injunction to prevent members of the least, been an intimidation of the dealer to such an extent that
union from “interfering” with their workers. The company also he is afraid to disclose the facts except secretly.” It is never
sought damages for enticing workers to break their contracts. stated, though, what specific actions were found to have been
intimidating, leaving open the possibility that the mere fact of
Issue: Were the union and its members guilty of the crime of organizing a boycott itself may have been the tortious act.
“watching and besetting” and various tortious wrongs, includ-
ing inducing breach of contract as well as intimidation?
The Krug case demonstrates how even peaceful, non-violent picketing could be prohibited
by the Criminal Code provision against watching and besetting. Justice Meredith noted that
some of the ways in which striking workers went about achieving their ends were “offensive” and
sympathy strike: A strike undertaken by workers who do not have an immediate and direct grievance against their own
employer, but who strike as a means of showing support and solidarity with other striking workers who do have such a griev-
ance with their employer.

“highly reprehensible,” such as launching insults and attempting to crowd non-striking workers
off of sidewalks.
The Trade Unions Act, the Criminal Law Amendment Act, and the Breaches of Contract Act22
of 1877, which provided that it was no longer a crime for an employee to quit or breach an
employment contract, established the early statutory foundation for collective bargaining rights
in Canada.23 Moreover, although the Nine-Hour Movement fizzled out after the arrest of its
striking leaders, it represents a turning point in labour history because it was the first example
of labour’s coordinated action across various occupational lines. In the words of Professor Craig
Heron, the “explosion of broad-based working-class solidarity … encouraged labour leaders to
develop a more permanent presence in Canadian public life.”24 Moreover, the legislation that the
movement propelled revealed not only the political power of organized labour but also the
power of the state to act as a “pacifying force on a militant labour movement.”25 State interven-
tion to quell industrial unrest would become a mainstay of labour’s story in the 20th century.
D. Employer Intransigence and Increasing Worker Militancy

Notwithstanding the often opaque legal status of combining, attempting to negotiate, striking,
and picketing in 19th-century Canada, by the dawn of the 20th century it was clear that govern-
ment inaction on behalf of labour—that is, generally allowing workers to fend for themselves—
made things little better for the average worker. The legal status of collective worker action in
the late 1800s and early 20th century was summarized as follows by Professor Harry Arthurs:
Workers who sought to organize a union confronted, first of all, the possibility of economic reprisals
by their employer. An employer could, with impunity, refuse to employ unionists, to negotiate with
the union, or to abide by any undertakings given to the union. Whether he would, as a matter of
prudence, actually adopt such a position depended upon the relative power of the parties [see the
discussion of “internal inputs” in Chapter 2]. If the employer chose to dismiss unionists or to refuse
to recognize a union, the union could respond by calling a strike or imposing other economic sanc-
tions. However, the employer, in turn, could seek relief in the civil or criminal courts against such
sanctions and, as the law stood down to the 1940s, be reasonably confident of success. Thus, the
freedom to organize often amounted, in practical terms, to no more than the freedom to suffer ser-
ious adverse legal and economic consequences.26
Employment opportunities improved considerably in the 1880s. By this time, industrializa-

tion was moving full steam ahead and with it the motivation to employ gang bosses to control
and discipline increasingly large workforces. The 1889 Royal Commission on the Relations of
Labour and Capital in Canada revealed a system where beatings were administered and workers
were easily fired and replaced.27 This system, which came to be known as the coercive drive
system, galvanized worker resistance.
The first permanent national labour organization, the Trades and Labor Congress of
Canada (TLC), was established in 1886. For a brief period in the late 19th century, the TLC
gang bosses: Workers employed to supervise the increasingly industrializing workforce in the late 19th century. They had
almost total control over the workers they supervised. Often they were paid based on the productivity of their workers. Thus, the
discipline they administered was often harsh and arbitrary.
coercive drive system: A management approach to productivity, most commonly associated with the 19th century, which
sought to increase worker output through fear and intimidation.
Trades and Labor Congress of Canada (TLC): The first federation of labour unions formed in Canada in 1886. In 1956, the
TLC merged with the Canadian Congress of Labour (CCL) to form the Canadian Labour Congress.

brought together craft unions and the emerging industrial unionism movement, led by the
American-based Knights of Labor. The Knights of Labor expanded into eastern Canada in the
1870s and proselytized a new form of unionism that rejected narrow craft-based organizing in
favour of a model that organized all workers, skilled and unskilled alike. The idea of industrial
unionism threatened the craft unions. As a result, in 1902 the TLC membership ousted the
Knights in favour of a return to craft unionism, a move that temporarily stalled the advancement
of industrial unionism in Canada. The TLC existed until 1956 when a merger with a rival labour
organization, the Canadian Congress of Labour, led to the founding of the Canadian Labour
Congress (CLC), which today is the only national umbrella labour organization in English
Canada (see Chapter 28 for a discussion of the CLC’s functions).
E. Industrial Disputes Investigations Act, 1907

As workers continued to agitate and strike for better conditions in what were often unsafe,
unsanitary, and exceedingly harsh work environments with long hours and little pay, legislation
sprang up that required third-party conciliation in industries considered essential for the bur-
geoning Canadian economy. The purpose of such legislation was to reduce the amount of time
lost to strikes in key sectors by introducing a neutral third party to help resolve disputes and by
imposing a waiting period before a strike (or lockout) could proceed.
One example of such legislation was the Industrial Disputes Investigations Act (IDIA) of 1907,
enacted by the federal government under the auspices of then Minister of Labour William Lyon
Mackenzie King. The IDIA was directed to specific industries, namely mining, communications,
transportation, and public utilities, except the railway industry, which, since 1903, had had its
own equivalent legislation.28
Conciliation boards appointed under the IDIA could neither prevent strikes or lockouts nor
impose a settlement upon parties. Rather, conciliation boards provided a means to investigate
the dispute in an effort to aid the parties to come to a mutually agreed upon settlement, in the
hopes of avoiding work stoppages. King believed that when applied, this model would ensure
that the vast majority of collective bargaining disputes would be resolved without a work stop-
page, and according to a survey from 1912, the majority of parties that underwent conciliation
arrived at a settlement without any work stoppage.29 The IDIA’s influence is still felt today. It laid
the foundation for two central aspects of our existing labour relations model, namely, the
requirement for collective bargaining parties to exhaust government-provided conciliation
services and to then wait out a specified period of time (a “cooling-off ” period) prior to resort-
ing to labour action (see Chapter 34).30
III. Labour in the Early 20th Century and the Interwar Years
By World War I, Canada had largely left its agrarian mode of production behind. From the early
20th century until the start of the war, Canada experienced spectacular industrial growth for
which waves of immigrant labour were necessary. Adults and children worked long days, often
Knights of Labor: An organization formed in the United States in 1869 and that was active in Canada between about 1875
and the early 1900s. The Knights promoted “industrial unionism,” the organization of all workers regardless of skill, gender, race,
or religion.
Canadian Labour Congress (CLC): The largest federal confederation of unions in Canada, representing 3 million Canadians.
Its main roles are to lobby governments, provide leadership on key issues, and provide training and education resources for its
member unions. It holds a national convention every three years.

in unsanitary, unsafe conditions and for low wages.31 A 1919 report on labour relations by the
Royal Commission on Industrial Relations ascertained that, despite the common excuse that
industrial unrest was organized by “alien” influences who came to rouse an otherwise contented
workforce, the real cause was the harsh socio-economic conditions of Canadian workers.32 The
report recommended, among other things, that employers recognize unions as the legitimate
representatives of their workers and negotiate with them. This recommendation fell on deaf ears
for another 25 years. Instead, employers resisted union efforts by hiring replacement workers,
and employers’ efforts to end strikes were often bolstered by government troops. Clashes on
picket lines were violent. Troops dealt harshly with strikers, who were often maimed and some-
times killed with impunity.
After World War I, Canada experienced an economic downturn. Soldiers returning home
from the war discovered that jobs were scarce and that inflation had considerably outpaced
wages. The cost of living was 64 percent over what it had been before the war.33 People were
discontented, remembering the huge profits made by weapons manufacturers. Workers went on
strike, demanding increased wages and union recognition, and this labour unrest culminated in
what is one of the most famous moments in Canadian labour history, the Winnipeg General
Strike of 1919 (see Box 29.2).

The Winnipeg General Strike of 1919
What began as a local strike of the building and metal workers
in Winnipeg, Manitoba, on May 1, 1919, soon amassed a huge
following. Two weeks later, an appeal by the Winnipeg Trades
and Labour Council for a general strike was met with 30,000
union and non-union workers walking off the job that same
morning. Sympathy strikes broke out across the country.
Approximately six weeks later, most of the municipal police,
ordered to disperse the crowd, were fired when they refused
to sign a “no strike” pledge. They were replaced by “special
constables” hired by the business community, whose efforts
were supplemented by the North-West Mounted Police. Mean- Source: Public domain.
while, the Conservative government in Ottawa, under Prime
Minister Robert Borden, enacted legislation expanding the workers began to view themselves “as a class” with interests
scope of criminal sedition, and that law was used as the basis that were divergent from employers, who thus constituted a
to arrest 12 suspected strike leaders. This event sparked out- separate class. Also, it sounded the death knell of narrow craft
rage among the strikers, and the strike turned violent. On June unionism, since the strike involved large numbers of unskilled
21, strikers took to the streets of Winnipeg where they were workers as well as women.† In the following few decades,
met by stampeding police and the special constables. Two demand would be mostly for semi-skilled or unskilled, rather
strikers were killed, 24 were injured, and 94 were arrested than skilled, labour power.
(seven of whom were sentenced to between six months and
two years of jail).* * D. Morton, Working People, 5th ed (Montreal, QC: McGill-Queen’s
Although the revolt was crushed, the Winnipeg General University Press, 2007) at 122.
Strike is viewed as a touchstone event in labour history. Ac- † John Godard, Industrial Relations, the Economy, and Society, 4th ed
cording to Professor John Godard, it was the first time that (Concord, ON: Captus Press, 2011) at 90-91.
The interwar years saw the re-emergence and expansion of industrial unionism, the model
that had been promoted by the Knights of Labor. Many unions would, throughout these years,
agitate not only for better working conditions but also for the replacement of the capitalist eco-
nomic system, which they viewed as inherently exploitive. Many of these unions were explicitly

influenced by Bolshevism and other socialist ideas and movements, such as One Big Union
(OBU) and the Industrial Workers of the World (IWW; called “Wobblies”).
A. The Great Depression and the Wagner Act

In 1933, four years after the Great Depression began, about 15 percent of the Canadian popula-
tion relied on government assistance to survive, and the unemployment rate had reached about
29 percent. “Relief camps” had been introduced in 1932 by the federal and provincial govern-
ments as a temporary measure to keep unemployed men occupied doing manual labour for
room and board and 20 cents per day.34 These camps proved fertile ground for Communist
organizers who, in 1935, organized hundreds of relief camp workers to board a train in Vancou-
ver headed to Ottawa to protest conditions in the relief camps and to demand jobs and decent
working conditions. The “On to Ottawa Trek” came to an end in Regina, where the RCMP
arrested dozens of the “trekkers” and a violent clash left one police officer dead.
In the same year as the On to Ottawa Trek, the US Congress enacted the National Labor Rela-
tions Act, commonly known as the Wagner Act, named for its sponsor, Senator Robert Wagner. The
Wagner Act sought to bring stability to industry by creating “a process through which an employer
could be compelled to recognize a union as the legitimate bargaining agent for its employees.”35 The
Wagner Act explicitly recognized the unequal bargaining power between employers and employees
and that the use of such power to refuse to collectively bargain leads to “industrial strife or unrest.”36
The Wagner Act established employer recognition of unions through three main features.
First, it created a legal certification process, through which workers could “[designate] represent-
atives of their own choosing.”37 Certification entailed two important principles: majoritarianism
and exclusivity, which will be discussed in greater detail in Chapter 31. The former means that a
majority of workers must be in favour to organize a union. The latter means that the union so
chosen becomes the exclusive bargaining agent for the whole group of workers in what is called
the bargaining unit, even those that voted against unionization. Second, the act made unfair
labour practices illegal. Employers could no longer refuse to hire or choose to fire employees
Bolshevism: A term derived from the Bolshevik Party, which led the Russian Revolution of 1917. Bolshevism refers to the
methods, practices, and beliefs of the party.
One Big Union (OBU): A labour organization active primarily in western Canada between 1919 and the early 1920s that
argued for workers to unite into a single union that could challenge the capitalist order through activism. OBU existed in some
form until it formally merged with the Canadian Labour Congress in 1956.
Industrial Workers of the World (IWW): A labour organization founded in 1905 in Chicago and particularly active in
western Canada during the early 20th century that advocates for all workers to join together, including the unemployed, and to
engage in general strikes to resist and ultimately replace capitalism with a more worker-controlled system. The IWW still exists.
relief camps: Camps created by the federal government during the Depression years of the early 1930s to house single, unem-
ployed males. In exchange for room and board, the men were assigned physically demanding work under harsh working conditions.
Wagner Act: Collective bargaining legislation enacted in 1935 in the United States granting workers a legal right to unionize,
engage in collective bargaining, and strike. The Wagner Act inspired modern Canadian collective bargaining legislation.
certification: The process for legally recognizing a union as the exclusive bargaining agent of a particular group of workers.
majoritarianism: A principle of the Wagner model, it asserts that a union must secure the support of a majority of employees
to win the right to act as their representative.
exclusivity: A principle of the Wagner model, it asserts that the union chosen to represent workers becomes the sole or exclusive
legal representative for that group of workers.
bargaining unit: A group of workers whose work is similar enough that they are thought capable to be covered by the same
collective agreement. Importantly, not all bargaining unit members necessarily choose to join the union.
unfair labour practice: An action undertaken by either the union or the employer that violates one or more articles in the
relevant labour relations legislation.

who supported unions, or refuse to negotiate with the duly recognized workers’ union. Thus, the
act required employers to bargain collectively with the unions that were certified. An employer’s
ability to intervene in union organization drives was also significantly curtailed. Third, the act
codified the right of workers to strike.38 These three features of the Wagner Act have collectively
become known as “the Wagner model.” This model is unique to North America. However, it
would not come to Canada for nearly a decade after its introduction in the United States.
B. Oshawa General Motors Strike, 1937

In 1937, unlike American workers, Canadian workers still had no legislative provisions requir-
ing employers to negotiate with their unions. Consequently, workers at the General Motors
(GM) plant in Oshawa, Ontario, who requested and were denied an eight-hour workday, better
wages and working conditions, seniority, and recognition of their union (a Canadian affiliate of
the American-based United Auto Workers Union [UAW]) had a major confrontation with their
employer.39 Low wages and unsafe working conditions had previously prompted a walkout of
most GM employees in 1928. At that time, the workers won many of their demands. Thus
emboldened, many of the workers attempted to organize into a union under the auspices of the
Trades and Labor Congress of Canada. However, the TLC’s continued ethos of craft unionism,
discussed above, was ultimately rejected by GM employees.
The GM workers continued to experience speed-ups, few rest periods, and months of only
part-time work hours. When yet another speed-up was announced by GM, the workers decided
to strike again. In April 1937, 4,000 workers struck against the car manufacturer. The UAW or-
ganized the workers under the umbrella of a new competitor in Canada to the TLC known as
the Congress of Industrial Organizations (CIO). The CIO was formed in the United States in
1935 to promote industrial unionism—the idea that unions should represent all workers and not
just the skilled crafts—in contrast to the emphasis of its rival organization, the American Fed-
eration of Labor, which promoted craft unionism.
GM ardently opposed the CIO, with the help of then Ontario Premier Mitchell Hepburn, who
threatened to use the provincial police to break the strike. The event precipitated a Cabinet crisis
when Mitchell’s own minister of labour opposed him, stating that his place was “marching with
the workers” and not with GM.40 The workers did not win formal recognition of their union, but
GM agreed to many of the union’s proposals. The premier failed in his objective to smash the or-
ganizing efforts of the CIO and industrial unionism. The Oshawa General Motors strike stands out
in labour history as a “breakthrough for industrial unionism in the mass production industries in
Canada,” which “stimulated unionization in the auto and other industries.”41
The General Motors strike of 1937, with

workers gathered in Oshawa, Ontario.
Source: Walter P. Reuther Library, Archives of Labor and
Urban Affairs, Wayne State University.
Congress of Industrial Organizations (CIO): A labour organization founded in the United States in 1935 that advocated
for industrial unionism, in contrast to its rival organization, the American Federation of Labour, which at that time promoted
craft unionism. The CIO played a prominent role in organizing Canadian industrial workers during the late 1930s and 1940s.

IV. The Foundations of the Modern Collective Bargaining Model:

PC 1003 and the “Rand Formula” (1940s)
A. PC 1003 (1944): The Wagner Model Comes to Canada

The rapid industrialization brought about by wartime growth in the early 1940s, combined with
labour shortages as men headed to the front lines of World War II, made conditions ripe for
organizing. With the economy nearing full employment, workers and their unions enjoyed great
bargaining power. Between 1940 and 1945, trade union membership nearly doubled.42 A
nationwide walkout in the steel industry in 1943, combined with other work stoppages, meant
that one out of every three workers was on strike. Meanwhile, a new political party, formed in
1932, was gaining momentum at both the provincial and federal levels: the Co-operative Com-
monwealth Federation (CCF), the predecessor to the New Democratic Party. The CCF sup-
ported a Canadian version of the Wagner Act that would ensure unions a legal right to be
recognized with the support of a majority of workers.43 Unions began to throw their political
support behind the CCF.
In 1943, Ontario’s Liberal government became the first province to enact legislation modelled
after the Wagner Act: the Collective Bargaining Act.44 Later that year, the CCF became the official
opposition in Ontario after winning 34 seats in the provincial election. Many of the new MPPs
were labour leaders. Growing labour unrest and the threat posed by the growing popularity of
the CCF and its new ties to the labour movement finally pushed the federal Liberals, then under
the leadership of Prime Minister Mackenzie King, to introduce its own version of the Wagner
Act, known as the Wartime Labour Relations Order, or Order in Council PC 1003.45 PC 1003
was passed in 1944 pursuant to the War Measures Act, which temporarily bestowed jurisdiction
over labour relations to the federal government (see also the discussion in Chapter 28).46
PC 1003 enacted the basic framework of the Wag-
ner Act, including compulsory union recognition
and a duty to bargain with an exclusive union that is
supported by a majority of employees. However, PC
1003 also included distinctive Canadian elements,
including the practice of mandatory conciliation,
which had existed in embryonic form in key Can-
adian industries since the turn of the century. In
addition, unlike the Wagner Act, it prohibited strikes
during a collective agreement, a policy that contin-
ues to this day, as we will discuss in Chapter 34. As
federal wartime legislation, the sun was setting on
PC 1003 as soon as it came into being. However, by
1948 virtually every province, as well as the federal
jurisdiction, had its own labour relations legislation
based on the model introduced in PC 1003. That
model dominates Canadian collective bargaining
Prime Minister William Lyon Mackenzie King. law to this day.
Co-operative Commonwealth Federation (CCF): A social-democratic Canadian political party formed in Alberta in 1932
that was succeeded by the New Democratic Party (NDP) in 1961.
PC 1003: Federal legislation that granted workers collective bargaining rights, including protection from anti-union discrimin-
ation by employers and a limited protected right to strike, and imposed on employers a legal “duty to bargain” with unions
representing a majority of workers.

B. The Rand Formula

The Ford strike that took place in 1945 in Windsor, Ontario, brought to Canadian labour law
another foundational element—the Rand Formula, which led to mandatory union dues check-
off clauses becoming standard in Canadian collective agreements. The Rand Formula is named
for Justice Ivan Rand, who arbitrated a settlement between striking UAW workers and the Ford
Motor Company after the momentous and bitter 99-day strike. At arbitration, Justice Rand had
to determine whether to establish a union shop and to include a mandatory union dues check-
off clause in the collective agreement (both of which the union wanted and the company
opposed). Rand split the difference (see Box 29.3).

Justice Ivan Rand and the “Rand Formula”
Ford Motor Company v. United Automobile Workers Union law of their employment, the union contract; that they
[1946] OLAA No. 1 must take the burden along with the benefit. … It may
be argued that it is unjust to compel non-members
Key Facts: In 1945, after a year and a half of failed attempts to of a union to contribute to funds over the expendi-
reach a collective agreement, unionized workers struck at the ture of which they have no direct voice; and even
Ford Motor Company in Windsor. The strike continued peace- that it is dangerous to place such money power in
fully before police were called in to clear a path to the boiler the control of an unregistered union. But the dues
room, and the strikers responded by using their cars to block are only those which members are satisfied to pay
access to the factory and by damaging some company property. for substantially the same benefits, and as any em-
The main issues were related to the union’s claim for clauses in ployee can join the union and still retain his in-
the collective agreement that would (1) require the employer dependence in employment, I see no serious
to deduct union dues from each employee covered by the col- objection in this circumstance. The argument is
lective agreement and remit the money to the union; and (2) really one for a weak union. [Emphasis added]
require all employees covered by the collective agreement to
become union members. The strike ended when these issues In rejecting the union’s claim for a closed “union shop” that
were referred to Justice Rand to issue a binding decision. would require as a condition of employment that employees
Issue: Should the collective agreement require mandatory become union members, Rand wrote:
union membership and mandatory union dues check-off?
Basing my judgment on the principles which I think
Decision: Justice Rand split the difference. He did not require
the large majority of Canadians accept, I am unable
that all workers be required to join the union, but he did re-
in the circumstances to award a union shop. It would
quire that all workers pay union dues, and that such dues be
subject the Company’s interest in individual employ-
“checked off” by the employer and remitted to the union.
ees and their tenure of service to strife within the
In accepting the union’s claim for a mandatory union dues
union and between them and the union … and it
check-off clause, Rand wrote:
would deny the individual Canadian the right to
the employees as a whole become the beneficiaries seek work and to work independently of personal
of union action, and I doubt if any circumstance association with any organized group. It would also
provokes more resentment in a plant than this shar- expose him even in a generally disciplined organiz-
ing of the fruits of unionist work and courage by the ation to the danger of arbitrary action of individuals
non-members. … I consider it entirely equitable then and place his economic life at the mercy of the
that all employees should be required to shoulder their threat as well as the action of power in an uncon-
portion of the burden of expense for administering the trolled and here an unmatured group.
Rand Formula: Refers to the practice in unionized workplaces of requiring automatic union dues check-off of all workers
covered by the terms of a collective agreement, regardless of their union membership status.
union dues check-off: A “union security” clause whereby all members of a bargaining unit must pay union dues and employers
must “check off” these dues from workers’ wages and remit them to the union.
union shop: A “union security” clause whereby all workers in a given job classification are required to join the union. Union
shops are distinct from closed shops, open shops, and agency shops.

Although Rand’s decision applied only to the parties in the case, union dues check-off clauses
soon appeared in collective agreements across Canada, and some provinces enacted laws that
effectively required mandatory union dues check-off, as we will explore in Chapter 35. Whether
employees in a bargaining unit should be required to become union members is usually left to
collective bargaining.
V. Public Sector Collective Bargaining

Collective bargaining in the private sector expanded rapidly in the immediate years following
the enactment throughout Canada of legislation modelled after PC 1003, particularly in manu-
facturing and other heavy (male-dominated) industries like mining and forestry. The next big
domino to fall was the public sector, where thousands of workers were employed by Canadian
governments. The CCF government in Saskatchewan had extended collective bargaining rights
to its own employees in 1944, but in the rest of the country the prevailing attitude was that gov-
ernments, as representatives of the people, should not be required to bargain with unions.47
By the 1960s, attitudes were changing, in part because of the growing size of the public sector
and growing militancy among public sector employees and their unions. Although public sector
workers were not covered by the collective bargaining legislation applied to private sector work-
ers, many of them had still joined unions and some had begun to engage in what were then
unlawful strikes. In 1964, Quebec introduced public sector collective bargaining legislation after
the major labour federations, including the Quebec Federation of Labour, teachers, and hospital
workers, threatened a general strike.48 Finally, following a nationwide strike by postal employees
in 1965, the federal government introduced the Public Sector Staff Relations Act in 1967, which
extended some measure of collective bargaining rights similar to those in PC 1003 to most, but
not all, employees of the federal government. The remaining provinces quickly followed suit, so
that by the early 1970s, public sector employees in every jurisdiction enjoyed some form of col-
lective bargaining, although many employees were excluded and some employees were not
granted a legal right to strike but instead bargaining disputes were sent to committees or arbitra-
tors for resolution (see Chapter 38 for more on public sector bargaining).49
The extension of collective bargaining rights to public sector workers in the 1960s proved a
significant moment in Canadian labour history, as labour historian Desmond Morton explained:
In its way, the PSSRA was as significant as the Trade Unions Act of 1872 and P.C. 1003. Canada’s
labour movement had organized virtually all it could of the predominantly male, blue-collar and
shrinking industrial workforce, and … it was losing its share of the labour market. With the public
sector—now a fifth of the Canadian workforce—open to be organized, Canadian unionism began to
grow, from a quarter of the non-agricultural labour force at the beginning of [the 1960s] to well over
a third by 1970.50
As noted in Chapter 28, by 2018 just over 75 percent of public sector workers in Canada were
covered by a collective agreement compared to only 15.9 percent in the private sector. The mass
unionization of the public sector also swept thousands of women into unions for the first time,
fundamentally altering the composition of the Canadian labour movement. As private sector
unionization has declined, public sector unions have assumed a dominant role in Canadian
labour relations.
VI. Chapter Summary

The development of the labour movement and the gradual extension of the legal rights of work-
ers embodied in the Wagner model and the Rand Formula were the result of a long and arduous
(and often violent) process. This process was not linear: where some laws expanded rights,
others contracted them. The labour history described in this chapter left an indelible mark on
the progression of the Canadian collective bargaining regime that we will examine throughout
the remainder of the book.


1. Identify any two historical events discussed in this chapter, and explain their
significance.
2. What was the Industrial Disputes Investigations Act and in what way does it still resonate
in labour law today?
3. Explain the main aspects of the Wagner model of collective bargaining.
4. Explain the difference between a “craft union” and an “industrial union,” and identify two
Canadian organizations that supported each model.
5. Discuss the basis for Justice Rand’s decision. Is it fair to require people to pay union dues
if they choose not to belong to a union?

1. Workers have never been monolithic, and the labour 14. Trade Unions Act, SC 1872, c. 30.
movement has consistently had to contend with creating 15. An Act to amend the Criminal Law relating to Violence,
solidarity even amidst numerous lines of division. Threats and Molestation, SC 1872, c. 31.
2. C. Heron, The Canadian Labour Movement: A Short 16. Trade Unions Act, supra note 14, s. 2. See J. Fudge & E.
History, 2nd ed (Toronto, ON: Lorimer, 1996) at 1. Tucker, “The Freedom to Strike in Canada: A Brief Legal
3. E. Tucker, “That Indefinite Area of Toleration’: Criminal History” (2010) 15:2 CLELJ 333.
Conspiracy and Trade Unions in Ontario, 1837 – 77” 17. Trade Unions Act, supra note 14., s. 5.
(Spring 1991) Lab 27 at 28.
18. An Act to amend the Criminal Law, supra note 15, s. 4(c).
4. The differences in the relationship between master and
19. Ontario Workman, May 2, 1872; and Ontario Workman,
apprentice/master craftsman and journeyman/employer
May 23, 1872.
and employee are captured in Charles Dickens’s A Christ-
mas Carol. There, Ebenezer Scrooge was apprenticed as a 20. See, generally, Craven, supra note 10; Fudge & Tucker,
young man to Mr. Fezziwig, who is a father figure. He rep- supra note 16; and Tucker, supra note 3.
resents the lost traditions that must give way to the new, 21. Fudge & Tucker, supra note 16 at 18.
impersonal, and “every man for himself ” ethic that 22. Breaches of Contract Act, 1877, SC 1877, c. 35.
Dickens attributes to the Industrial Age.
23. R. Marsden, “Labour History and the Development of
5. Tucker, supra note 3 at 21. Modern Capitalism” in M. Gunderson & D. Taras, eds,
6. An Act to Regulate the Duties Between Master and Servant, Canadian Labour and Employment Relations, 6th ed
and for Other Purposes Therein Mentioned, S. Prov. Can. (Toronto, ON: Pearson Education Canada, 2008) 56 at 64.
1847, c. 23. 24. Heron, supra note 2 at 15.
7. Master and Servant Act, S. Prov. Can. 1847, c. 23; and ibid. 25. Ibid. at 17.
at 34.
26. H. Arthurs, Labour Law and Industrial Relations in
8. See, generally, D. Hay & P. Craven, eds, Masters, Servants Canada, 4th ed (Deventer, Netherlands: Kluwer, 1993) at
and Magistrates in Britain and Empire, 1562 – 1955 (Chapel 196.
Hill, NC: University of North Carolina Press, 2004).
27. J. Rinehart, The Tyranny of Work: Alienation and the
9. Criminal Code, RSC 1985, c. C-46. Labour Process, 2nd ed (Toronto, ON: Harcourt Brace,
10. Tucker, supra note 3 at 31-32; and P. Craven, “Workers’ 1987) at 35-38.
Conspiracies in Toronto, 1854 – 72” (Fall 1984) 14 Lab 49. 28. Railway Labour Disputes Act, SC 1903, c. 55.
In his survey of Toronto courts between 1854 and 1872,
Paul Craven (York University) was unable to find a case 29. M.M. Marks, “The Canadian Industrial Disputes Act”
where workers were convicted on common law conspiracy (1912) 44 Annals Am Ac Pol & Soc Sci 1.
charges, absent violence or threats of violence. 30. Labour Relations Act, 1995, SO 1995, c. 1, Sched. A, s. 18.
11. Tucker, supra note 3 at 31-33. 31. See, generally, As Friend and Foe (Montreal, QC: National
12. Heron, supra note 2 at 14-15. Film Board of Canada, 1980), YouTube: <https://www.
youtube.com/watch?v=9K9HZ_40H0M>.
13. M. Chartrand, “The First Canadian Trade Union Legisla-
tion: An Historical Framework” (1984) 16:2 Ottawa L Rev 32. B. Burkett, “The Future of the Wagner Act: A Canadian-
271. American Comparison” (2013) 38:2 Queen’s LJ 363.

33. “The Winnipeg General Strike,” CBC: Le Canada, A Peo- 43. L. S. MacDowell, “The Formation of the Canadian Indus-
ple's History, online: <http://www.cbc.ca/history/EPIS- trial Relations System During World War Two” (1978) 3
CONTENTSE1EP12CH3PA2LE.html>. Lab 175 at 190.
34. D. Morton, Working People, 5th ed (Montreal, QC: McGill- 44. For a review of the legislation, see B. Laskin, “Collective
Queen’s University Press, 2007) at 146-47. Bargaining in Ontario: A New Legislative Approach”
35. Burkett, supra note 32 at 364. (1943) 21 Can Bar Rev 684.
36. National Labor Relations Act, 1935, 29 U.S.C., s. 151 (Find- 45. Wartime Labour Relations Order (PC 1003) is available at
ings and declaration of policy). <https://en.wikisource.org/wiki/
Wartime_Labour_Relations_Regulations>.
37. Ibid.
46. See Chapter 17 for a discussion of the division of powers
38. Ibid., s. 163 (Right to strike preserved).
(jurisdiction) over labour relations. In 1925, in the case of
39. See, generally, I. Abella, “Oshawa 1937” in L. Sefton Mac- Toronto Electric Commissioners v. Snider, 1925 CanLII 331
Dowell & I. Radforth, eds, Canadian Working Class History (UK JCPC), the Privy Council ruled that primary jurisdic-
(Toronto, ON: Canadian Scholars’ Press, 1992). tion fell to the provinces. The War Measures Act tempor-
40. Morton, supra note 34 at 160. arily suspended that ruling.
41. L. Sefton MacDowell, “After the Strike—Labour Relations 47. Morton, supra note 34 at 255-258.
in Oshawa, 1937 – 1939” (1993) 48:4 Indus Rel 691 at 691. 48. Ibid. at 260.
42. D. D. Carter et al., Labour Law in Canada, 5th ed 49. Ibid. at 263.
(Deventer, Netherlands: Kluwer, 2002); and Labour and
50. Ibid. at 261.
Employment Law Casebook, 8th ed. (Toronto, ON: Irwin
Law, 2011) at 18.

CHAPTER 30
Why Do Workers Join Unions,

and What Effects Do Unions
Have on Business?*
II. Why Do Workers Join Unions? 492
• Explain the main reasons workers join unions.
A. Instrumental Reasons 492
• Identify factors that make workers more likely to join unions. B. Economic Reasons 493
• Discuss the empirical evidence concerning the union effect on firm III. Other Factors That Influence the Likelihood a Worker Will Join a
productivity, profits, employment growth, and innovation. Union 495
A. Personal and Job Characteristics 495
B. Socio-economic Status 495
C. The Work Environment 496
IV. How Do Unions Affect Business Outcomes? 496
A. Union Effects on a Company’s Productivity and Profits 496
B. Union Effects on Employment 498
C. Union Effects on Business Innovation 498
D. Union Effects on Executive Compensation, Civic
Engagement, and Income Inequality 499
Exercise 500
I. Introduction
Approximately one in three workers (30.1 percent) in Canada is covered by a collective agree-
ment bargained by a union.1 This fact, coupled with the spillover effect (see Chapter 2) that
unions have on non-unionized workplaces, makes unions an important part of the Canadian
labour market. Unions provide a number of services to workers. They give workers a collective
voice and otherwise provide representation in the workplace; they negotiate higher wages and
seniority-based job security; and they provide access to a third-party grievance process in the
spillover effect: The effects that collective agreement settlements bargained by unions and employers have on individual
employment contracts in non-union workplaces.
* This chapter was authored by Scott Walsworth, Associate Professor of Industrial Relations, Edwards
School of Business, University of Saskatchewan.
491

event of a dispute with management. On the other hand, unions may affect an employer’s
competitiveness, especially in industries with non-union firms, and may introduce rigidities
that slow organizational change within unionized workplaces. This chapter considers important
industrial relations questions, such as why workers join unions and the impact of collective
bargaining on firm productivity, profits, employment growth, and innovation.
II. Why Do Workers Join Unions?

In 2004, two University of Calgary professors tricked business students into joining a union,
something the students thought they would never do. At about the midpoint of the semester,
students were told that their professor had been suspended and a new professor was appointed.
The new professor proceeded to unilaterally change the course outline in ways that discounted
previous student work while adding extra assignments. As expected, the students objected.
However, the way in which the students went about seeking justice was unexpected, at least to
them: almost immediately, they signed a petition, banded together as a group, and proceeded to
plan collective action—just like a union.2
In this scenario, the students formed a group to address a common problem with a more
powerful adversary (the new professor). In essence, they formed a union for the same reasons
workers join a union to bargain with their employer. For example, an individual worker may
demand a wage increase and threaten to stop working if the employer does not agree. The cost
of a single worker refusing to work is relatively small, and the employer would likely respond by
refusing to grant the wage increase and perhaps even fire the employee. However, if all of the
workers make the same demand with the same threat to withdraw their labour (to strike), the
cost to the employer is much greater because production comes to a halt. Once the employer’s
ability to earn revenue is compromised, the employer is much more likely to begin negotiating
a wage increase. In a nutshell, workers join a union to increase their bargaining power to con-
vince their employer to negotiate more favourable employment terms.
Industrial relations and sociology scholars have studied the reasons why people join unions.
Their findings are summarized in this section. Sometimes union members want a greater say in
how the workplace is run and how their time at work is spent (instrumental reasons). Some-
times union members are looking for better wages, benefits, pensions, or other perks (economic
reasons). Most of the time, people join unions because they are interested in both instrumental
and economic reasons.
A. Instrumental Reasons

In 1984, Harvard economics Professors Richard Freeman and James Medoff published a seminal
book called What Do Unions Do? It described workers’ options when faced with unfavourable
working conditions as the choice between exit and voice.3 “Exit” refers to a worker’s ability to
quit if they do not like the terms of employment. In the common law regime, “exit” is often the
only viable option for employees, since individually they lack the bargaining power to persuade
their employer to provide improved contract terms or the inclination to approach their em-
ployer with demands for fear of reprisals.
“Voice” refers to a worker’s ability to communicate discontent to the employer and thereby
effect change in the workplace to secure better employment terms (such as a wage increase).
Unions are particularly effective at increasing workers’ voice in the workplace, because they
operate at arm’s length from the employers with whom they negotiate. Moreover, they possess
the financial resources and expertise to protect employees from employer reprisals when em-
exit and voice: Two options workers have when confronted with an unfavourable employment condition: they can either quit
(exit) their job or stay and protest (voice) to effect workplace change.

Chapter 30 Why Do Workers Join Unions, and What Effects Do Unions Have on Business? 493
ployee concerns are voiced. Many workers join unions to secure a greater level of voice in the
workplace, particularly when they feel silenced in the non-union setting. That voice takes the
form of participation in collective bargaining or the grievance procedure in a collective agree-
ment, and sometimes in strike action.
Once an employer and a union negotiate a contract, called a “collective agreement,” they are
legally bound by the contract while it is in effect (usually between one and four years). To deal
with any disputes that arise from the administration or interpretation of the collective agree-
ment, the parties rely on a grievance procedure. For example, an employer who selects workers
for a training opportunity based solely on productivity while ignoring seniority may violate a
seniority provision in the collective agreement (see Chapter 35). In a non-union setting, an
employee who feels they were unfairly treated in violation of their employment contract and met
with an unrepentant employer can “exit” (quit) their job and perhaps sue the employer for
wrongful dismissal in the courts. A grievance procedure allows a unionized employee to file a
grievance alleging that the employer violated a clause of the collective agreement. On behalf of
the employee, the union will argue the grievance before various levels of management. If a reso-
lution is not found, the grievance may be referred to arbitration and decided by a labour arbi-
trator. Grievance arbitrators are neutral, meaning that they do not favour the employer or the
union (they act like judges), and their decisions are binding (meaning they are legally enforced).
B. Economic Reasons

1. Union Wage Premium
According to Statistics Canada, unionized workers earn on average $30.51 per hour compared
to $25.37 for non-unionized workers.4 Some of that difference is explained by occupational
segregation—unionized workers are employed in occupations that would pay more even if there
were no unions. If we compare two identical jobs, one performed by a unionized worker and
one performed by a non-unionized worker, and we control for all imaginable human capital
factors, such as workers’ productivity, experience, and education, on average the unionized
worker will still earn more than the non-unionized worker. This difference is called a union
wage premium and is the result of the union’s ability to bargain higher wages for its members.
The size of the union wage premium in Canada, which has been debated in the literature,
appears to be shrinking over time. American studies in the 1980s estimated that the union wage
premium in the United States was around 18 percent (if a non-union worker earned $20 an
hour, a unionized worker would earn 18 percent more, an additional $3.60 for a wage of $23.60
per hour).5 By contrast, a 2002 study by Professors Tony Fang and Anil Verma found that the
union wage premium in Canada was much lower, at around 7 percent.6 A 2012 Canadian study
by Professors Scott Walsworth and Richard Long found the union wage premium to be even
lower, at around 4 percent.7
Two studies find evidence that in addition to affecting the average wage within the firm,
unions impact the wage differential by reducing the difference between the highest- and lowest-
paid workers.8 As this evidence concerning wages and wage structures shows, unions generally
have what can be called an inequity-reducing effect, as they often reduce wage inequality. In
other words, unions promote wage equality, likely because large groups of employees are
grouped together and their wage rate is determined in collective bargaining, rather than based
on individual characteristics such as merit, gender, race, or rapport with management.
seniority provision: A clause in the collective agreement that allocates employment terms, such as rate of pay, promotion,
and so on, based on length of time since being hired.
union wage premium: The additional wage amount attributed to union membership.

2. Seniority-Based Benefits

When employment entitlements for an employee (such as rate of pay, benefits, access to training,
and protection from layoffs) are determined in whole or part by seniority (the length of time since
being hired), we say the employee is protected by a seniority provision negotiated by the employ-
ee’s union (see Chapter 35 for more on seniority provisions). Seniority provisions are standard in
most unionized workplaces. For the employee, the advantage of a seniority provision comes in the
form of better employment terms and greater job security as time passes. Many benefits negoti-
ated into collective agreements improve over time, creating an incentive for employees to remain
with the employer long term. Seniority provisions also remove potentially unfair or arbitrary
measures of performance by employers by creating a clearly defined, objective system for decision
making on such matters as promotions, layoffs, and recalls from layoffs. The desire of employees
to restrict managerial discretion that they believe is not being exercised impartially is among the
most common reasons why workers look to unions. For the union, the advantage of seniority
systems comes in the form of greater solidarity and unity among its members, since workers are
not pitted against one another in constant competition to earn better employment terms.
Employers can benefit from seniority provisions because workplaces with seniority systems
tend to experience lower employee turnover. On the other hand, some employers are often less
enamored with seniority provisions, because they limit employer discretion. A seniority provi-
sion may restrict an employer from assigning work to an employee it believes is the most pro-
ductive by requiring that the work be assigned to the most senior employee. Moreover, since
seniority provisions favour longer-serving employees, they can create barriers for young work-
ers and women who experience gaps in service owing to childrearing and child-care responsibil-
ities. Seniority provisions can also impede an employer’s ability to implement an incentive pay
program, such as a wage bonus for top performers. For all of these reasons, the utility of senior-
ity provisions has long been a hotly debated subject.

Unions as Agents of Social Change
We should be careful not to oversimplify the contributions of Unifor strives to protect the economic rights of our
unions for working people. A conservative approach to union- members and every member of the workforce (em-
ism, economic unionism, focuses exclusively or almost ex- ployed or unemployed). We are committed to build-
clusively on immediate bread-and-butter issues such as ing the strongest and most effective union to bargain
wages, seniority provisions, and grievance procedures in col- on behalf of our members, working with our mem-
lective bargaining. However, unions also play an important bers to improve their rights in the workplace, and
role in promoting broad social issues that affect both union- extending the benefits of unions to non-unionized
ized and non-unionized workers. When unions go beyond workers and other interested Canadians.
immediate workplace objectives and seek to address the For decades, union membership (as a share of
social conditions of workers, union and non-union alike, they total employment) had been in steady decline—par-
are engaging in social unionism. The following passage from ticularly in the private sector. Running parallel to this
the website of Unifor, the largest Canadian private sector decline in union density has been a sharp rise in in-
union, provides an example of how unions understand their come inequality, growing threats to retirement secur-
role to go beyond pure economic issues relevant to their im- ity, chronic unemployment and underemployment
mediate members: (particularly for young people) and a noticeable rise
in insecure, precarious forms of work, especially
economic unionism: A union philosophy that emphasizes immediate economic concerns of union members, including better wages and benefits.
social unionism: A union philosophy that emphasizes the labour movement’s important role in advancing democratic values, social justice, and fair treatment
of all workers.

among newcomers. The decline of union influence core mandate—to be an effective union that is built
coincided with the rise of grossly imbalanced busi- by its members and deeply rooted in community—
ness-friendly policies, starting in the 1980s, that in- brings Unifor’s work into the day-to-day lives of Can-
cluded tax cuts, labour market deregulation and adian families.
corporate-led free trade deals. … From its inception, Unifor has become a source
[Unifor’s] large and diverse membership (that of optimism and inspiration that a fairer, more secure
includes nearly every sector of the economy) makes future can be won for working people, that unions
it one of the most representative voices of our na- can adapt to changing times and remain a relevant
tional economy. Its representative organizational voice for workplace and social justice.
structure and innovative forms of membership
means it can better address regional economic and Source: Unifor, “History & Mission,” online: <http://www.unifor.org/en/
political matters on behalf of working people. Its about-unifor/history-mission>.
III. Other Factors That Influence the Likelihood a Worker Will Join a
Union
In addition to the instrumental and economic reasons just reviewed, three factors influence the
likelihood that a worker will decide to join a union: personal characteristics, socio-economic
status, and the work environment.
A. Personal and Job Characteristics

Workers with greater commitment to a particular employer, who are committed to staying with
the employer long term, are more likely to join a union. This makes sense, considering the union
wage premium and the seniority provisions discussed above. Older workers are more likely to
have intentions to remain with an employer because typically they find it more difficult to secure
a new job. People with dependants (children, family members) are also more likely to want to
stay with the same employer because of the risk of a loss of income while they find a new job.
Furthermore, unions have been successful in bargaining for greater family benefits and greater
job security, which are both important to people with dependants. Workers with firm-specific
skills are also more likely to want to remain with the same employer and reap the rewards of a
seniority provision. These workers cannot hope to have their skills recognized by a different
employer. For example, a worker with years of experience using a one-of-a-kind data software
program will have little success of securing a comparable salary with another employer who
does not use the same software. Thus, older workers, workers with dependants, and workers
with firm-specific skills have more incentive to remain with the same firm and are well placed
to take advantage of the seniority provisions and union wage premiums that accompany union
membership.
B. Socio-economic Status

In a unionized workplace, the wage rate is determined by a negotiation process between the
union and the employer. Subsequent wage increases are often assigned based on seniority. This
process is most advantageous to workers who are traditionally poorly paid in non-unionized
settings. From our discussion of discrimination in Chapter 18, we know that certain groups of
people are systematically underpaid. Their experience in the labour market makes them keen
to allow a union to negotiate a wage closer to the average. The union wage will almost always
be higher than what they could secure on their own. For instance, women, visible minorities,
and foreign-trained professionals (on average) earn less than their white, male, Canadian-
trained counterparts and therefore stand to benefit the most from a union-negotiated wage,
which makes them more likely to join a union if presented with the opportunity.9 For instance,
researchers examined over 5,000 American workplaces and noted the following:

The instrumental benefits of union membership for immigrant workers in terms of wage premium
are confirmed here. Union membership appears to deliver a modest wage premium to immigrant
workers. Unionised immigrants are twice as likely as non-unionised immigrants to earn above the
median hourly earnings and have greater pension coverage.10
C. The Work Environment

The level of contact a worker has with co-workers relative to the level of contact with managers
and supervisors has an important impact on where a worker’s allegiance lies. Workers who feel
alienated from their co-workers and close to their supervisor are less likely to turn to a union
for representation. By contrast, workers who have a strong bond with co-workers and feel alien-
ated from and are dissatisfied with their supervisors are more likely to join a union. For example,
a construction crew that works alongside their supervisor all day, in a positive environment, will
be less inclined to join a union compared with the same construction crew that only sees their
supervisor once a week for 30 minutes to get instructions.11
IV. How Do Unions Affect Business Outcomes?

Professors Pradeep Kumar and Chris Schenk have observed what they call a “dominant dis-
course” in the media that portrays unions in an overwhelmingly negative fashion: “[T]here are
frequent references in the media that unions are a special interest group, are ‘inflexible,’ are
always demanding more, cause inefficiency.”12 The term “union boss” is regularly used in a
derogatory manner to refer to democratically elected union leaders, while leaders of industry
are referred to positively as executives or leaders. This negative portrayal of unions supports a
narrative that unions are “bad for business.” But are they? A review of the academic literature on
union effects on a company’s productivity and profits paints a more nuanced picture.13
A. Union Effects on a Company’s Productivity and Profits

One of the most straightforward measures of firm success is profits. In industries with unionized
and non-unionized workplaces, it would seem that the latter would have an advantage. If it is
true that unionized workplaces have greater labour costs, inflexible workplace rules, a reduced
ability to attract capital investment, and depressed sales levels, it might be expected that non-
unionized workplaces would report higher levels of profits.14 Alternatively, it is possible that the
purported advantages of unions, such as lower rates of employee turnover, greater job security,
and higher employee morale, may improve employee productivity so that heightened productiv-
ity in unionized workplaces negates the increased costs associated with unions.
In What Do Unions Do? mentioned earlier, Professors Freeman and Medoff found that
unions have a positive effect on productivity (see Box 30.2).15 This was attributed to the union
“voice” mechanism, which promotes less employee turnover, and to the so-called shock effect,
whereby unions force managers to professionalize and adopt more systemized human resource
management policies. Also, sometimes unionized employers substitute capital (machines) for
employees where possible to reduce labour costs, which in turn can improve overall productiv-
ity. Freeman and Medoff ’s finding that unionization is associated with improved productivity
was considered surprising at the time because it ran contrary to popular assumptions. There
have been many studies since that attempt to test their hypothesis.16 The results are mixed. Pro-
fessors Robert Hebdon and Travor Brown summarized these findings as follows:
shock effect: A concept that describes how managers respond to unionization, and the ability of unions to enforce rules
and raise labour costs, by professionalizing their human resource management practices to reduce risk and find efficiencies and
thereby improve productivity.

Overall, the evidence to date produces several conclusions. First, the impact of unions on productiv-
ity is usually positive. Second, the relationship is not always positive and can vary by context (e.g.,
industry, country). Third, a positive labour relations climate can improve the union-productivity
relationship. Fourth, along the lines of the “which came first, the chicken or the egg” debate, we need
to be careful not to conclude that unions cause increased productivity. Rather, the evidence states
that unionization is associated with an increase in productivity. The causes for such productivity
increases could be a number of factors, such as increased health and safety focus, management being
“shocked” into improved practices, less turnover, and so on.17
Using a small sample of 100 Canadian firms, Michel Grant and Jean Harvey found no signifi-
cant difference between management’s perception of workplace productivity in unionized and
non-unionized firms.18

What Do Unions Do? by Richard B. Freeman and James L. Medoff
When published in the mid-1980s, the landmark book What
Do Unions Do?* surprised the business community by provid-
ing evidence that supported the beneficial role of unions.
Synthesizing ten years of empirical research on the economic
impact of unions on the American economy, the authors con-
cluded that, “On balance, unionization appears to improve
rather than harm the social and economic system.” This finding
flew in the face of conventional wisdom, which portrayed
unions as a cause of workplace conflict and inefficiency, and
one of the major causes of the declining competitiveness of
American firms. Their conclusion was especially startling since
both authors were respected members of the business elite;
both were professors in the department of economics at Har-
vard University.
* See B. Freeman & J.L. Medoff, What Do Unions Do? (New York: Basic
Richard B. Freeman of Harvard University. His
Books, 1984). co-author, James L. Medoff, died in 2012.
Source: Harvard University.
Studies examining the direct link between unionization and firm profitability in North
America are ambiguous. Two older US studies showed that unionized firms experience substan-
tially lower profits, whereas a more recent US study found that union presence is associated with
greater profitability, albeit the sample was restricted to newly created firms.19 Canadian evidence
is limited and dated. From a sample of manufacturing industries, Dennis Maki and Lindsay
Meredith reported no union effect on profits from 1970 to 1979; whereas Pasquale Laporta and
Alexander Jenkins found that union density (i.e., the proportion of workers who are union
members in a firm) has a negative effect on firm profitability after analyzing a sample of manu-
facturing industries from 1986.20 More recent U.S. studies also find evidence that profits are
lower in unionized versus non-unionized firms, with a typical estimate of the impact being in
the 10 to 20 percent range.21

B. Union Effects on Employment

The direct link between unionization and employment is investigated in only three studies in
North America. Studying a sample of 1,798 California manufacturing firms from 1974 to 1980,
Jonathan Leonard found that employment in unionized settings grew about 3.9 percent per year
slower than in non-unionized settings.22 There have been no US follow-up empirical studies
since Leonard’s article. In Canada, Professor Richard Long analyzed a sample of 510 Canadian
workplaces from 1980 to 1985 and reported that in the manufacturing sector, union firms grew
3.7 percent more slowly per year than non-union firms; similarly in the non-manufacturing
sector, union firms grew 3.9 percent more slowly per year than non-union firms.23 Also using
Canadian data, Professor Walsworth found a smaller negative effect of 2.2 percent per year when
the majority of a company’s employees are unionized, but no effect when the commonly used
“union status” measure is used (where even the presence of a single union member triggers the
firm to be coded as “unionized”).24 In a follow-up study, Walsworth and Long found that only
in larger firms in the manufacturing sector do unions have a negative impact on employment
growth. By contrast, they found that unions are associated with employment growth in smaller
firms in the service sector.25
C. Union Effects on Business Innovation

Innovation may be restricted in a unionized workplace for three reasons. First, with a more
formal relationship between workers and managers, it is likely that collaboration between work-
ers in different job areas and collaboration between workers and managers may be limited,
making product innovation less probable. Second, workers and managers may be more inclined
to view their goals as distinct from each other, leaving workers with reduced incentive to inno-
vate. For example, if a unionized worker is primarily concerned with wage maximization and
considers firm profits or market share to be largely the concern of management, there may be
limited desire or goodwill to innovate. Third, unions may pursue their goals by appropriating
workplace control from management, thus interfering with unilateral management decisions
regarding the design, speed, and process of production. In this scenario, it is easy to imagine a
management team becoming frustrated with a union that slows or even prevents the implemen-
tation of a policy designed to elicit specific employee behaviours, such as a reorganization of the
shop floor to encourage collaboration.
On the other hand, there are a number of reasons to suspect that unions promote innovation.
The strong preference of unions for seniority-based pay (as opposed to merit-based pay) may
encourage higher risk behaviours associated with innovation. In recognizing the separation
between pay and productivity, a worker is ensured of less financial consequence for pursuing
innovative ideas that may detract from immediate job productivity. For example, a worker is
more inclined to temporarily neglect immediate production requirements to experiment with
alternative production materials or processes that could significantly alter the final product.
Additionally, because union members usually enjoy a wage premium, greater firm-specific loy-
alty may result, and workers may be more inclined to make contributions toward innovation.
Finally, the purported higher cost of union labour and restrictions on outsourcing, via collective
agreements, may encourage firms to compete based on product innovation, by offering new
products or better quality products instead of competing based on low cost.26 In this sense, a
union-imposed higher production cost makes a low-cost product strategy less viable for union-
ized firms, and thus potentially promotes alternative product competition strategies that rely
more on product innovation.
Only a handful of North American studies examine the direct relationship between union-
ization and innovation, and the results are (once again) mixed. From a sample of Canadian
workplaces studied in 1999, Verma and Fang found no relationship between workplace union

density and product innovation.27 A more recent Canadian study of private sector firms found
a small positive union effect on innovation.28 From a US sample, Koeller found that unioniza
tion was significantly lower in firms with high innovation output.29 Again using a US sample,
David Audretsch and J.-Matthias Schulenburg found that high union density in a firm has a
negative effect on innovation.30
By way of summary, empirical evidence suggests that unions may have a negative impact on
some firm outcomes and a positive impact on others. However, especially in the Canadian con-
text, large gaps exist in the industrial relations literature examining union effects on business
performance. From an empirical standpoint, then, the effect of Canadian unions on firm per-
formance (as measured by productivity, profit, employment growth, and innovation) is poorly
documented in the industrial relations literature and does not provide clear support for the
common sentiment that unions are bad for business.
D. Union Effects on Executive Compensation, Civic Engagement, and Income

Inequality
There is a growing body of research that links countries with a strong union presence to higher
levels of civic engagement (greater volunteerism or community service), more extensive social
programs such as health care and pension plans, and lower levels of poverty.31 Unions tend to
pull compensation downwards so that executive compensation in unionized firms is lower,
whereas the average income of employees at the bottom end of the wage scale is relatively higher
than in comparable non-union firms.32 A 2013 study using Canadian data found that unionized
workers vote in political elections more than non-union workers, so there is a relationship
between unionization and broader political engagement.33 All of these outcomes result in
greater income equality, resulting in a society that has more evenly distributed its resources
across the population. Union advocates argue that union efforts, such as petitioning government
for better social programs or bargaining for more paid time off for community involvement, are
partly responsible for greater income equality (see Chapter 3). Others disagree, and argue that
unions do not cause these outcomes. Instead, they say that countries with a more socialist pol-
itical climate have laws that support a strong union presence and greater income equality.
V. Chapter Summary

In this chapter, we explored why workers join unions. Workers join unions for instrumental and
economic reasons. Unions are able to promote worker “voice” and can negotiate better employ-
ment terms such as a union wage premium, seniority provisions, and a grievance procedure.
Certain factors tend to influence the likelihood that a worker will join a union: personal char-
acteristics, such as being an older worker, a worker with dependants, or a worker with firm-
specific skills; low socio-economic status; the perceived instrumentality of the union; and a
work environment in which workers are alienated from their managers and supervisors. We also
reviewed the empirical evidence examining union effects on business and social outcomes,
including productivity, profitability, and innovation. Overall, the evidence concerning these
effects is mixed and inconclusive. We noted further a relationship between unionization and
greater economic equality—less of a gap between top and bottom income earners—and that
unionization tends to increase civic and political engagement in a society.

1. What is the voice effect? How might it contribute to the productivity of a unionized
workplace?
2. What is the “union wage premium” and how big is it in Canada?

3. Conceptually, can you think of reasons why a union might make a worker more produc-
tive? Can you also think of ways a union would detract from productivity? Do the same
for innovation.
4. What factors influence whether workers are more or less inclined to join a union?
EXERCISE
Read the following press release issued by the United Food and Commercial Workers Union in
2019 relating to its campaign to unionize Toronto Uber drivers. Identify reasons given why the
drivers are interested in unionizing. Are those reasons instrumental, economic, or both? Explain
your answers.
TORONTO UBER DRIVERS JOIN UFCW CANADA, CALLING FOR FAIR PAY, RESPECT
Amidst a major unionization drive that has seen hundreds of Canada. “Uber is the employer. The drivers are employees. The
Uber drivers in Toronto join UFCW Canada, Uber drivers and technology is just a management tool and the company should
their union held a media conference today at the Sheraton adhere to our labour laws,” the UFCW Canada leader remarked.
Centre Hotel in downtown Toronto to discuss the challenges “By joining UFCW, Uber drivers are now in alliance with a quarter
that drivers are facing, and the redress that they and their of a million workers across Canada,” said Pablo Godoy, National
union are seeking from Uber. Co-ordinator of Gig and Platform-Employer Initiatives at UFCW
At the conference, drivers spoke about the host of issues Canada. “Our union has decades of experience organizing work-
that make driving for Uber a low-paying, unfair, and at times ers to achieve respect, dignity, and fairness at work, and that is
unsafe job. For example, Uber drivers do not get paid sick days, exactly what we will be asking of Uber.”
vacation days, or extended health coverage, and must cover In addition to issues surrounding pay, benefits, and health
their own fuel and repair costs. They also have no access to and safety, drivers have also expressed concerns about harass-
workers compensation if they are injured at work, and when ment from customers and unfair rating systems that can lead
operating costs and hours of work are accounted for, often to drivers being removed from the Uber platform through no
make below minimum wage. fault of their own.
“Uber calls us partners, but we have absolutely no say about In response to these concerns, UFCW Canada has launched
our working conditions, or even being able to take a bathroom a major campaign that empowers Uber drivers to join the
break,” Ejaz Butt, an Uber driver who helped start the union union, and has also created a website—called Uber Drivers
drive, told reporters at the conference. “We know we make a United—where drivers can contact the union and join the
lot of money for Uber, but in return we get treated like we don’t movement to achieve fairness at Uber. The website also details
matter,” he added. ways that Uber customers and concerned citizens can help
Butt was joined by other Uber drivers who are seeking fair support Uber drivers in their campaign for fair pay, respect,
pay and respect from their employer, and who have chosen and a voice on the job.
UFCW Canada as their voice at work. “Companies like Uber, who
can hire and fire drivers and fully dictate the terms of employ- Source: UFCW Canada, “ Toronto Uber Drivers Join UFCW Canada, Calling for Fair Pay,
ment, should be held accountable for the well-being of their Respect” (June 2019), online: <https://www.globenewswire.com/news-release/2019
employees,” said Paul Meinema, the National President of UFCW /06/26/1874797/0/en/Toronto-Uber-drivers-join-UFCW-Canada-calling-for-fair-pay-
respect.html>.

1. See Statistics Canada, “Union Status by Industry,” online: 3. See R. Freeman & J.L. Medoff, What Do Unions Do? (New
<https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=14 York: Basic Books, 1984). On “exit and voice” theory, see
10013201&pickMembers%5B0%5D=2.3&pickMembers%5 A. Hirschman, Exit, Voice, and Loyalty: Responses to
B1%5D=4.1>. Decline in Firms, Organizations, and States (Cambridge,
2. D. Taras & P. Steele, “We Provoked Our Students to Union- MA: Harvard University Press, 1970).
ize: Deception Creates a Lasting IR Message” (2007) 45:1 4. Statistics Canada, “Employee Wages by Job Permanency
Brit J Indus Rel 179. and Union Coverage, Annual” Table 14-10-0066-01

(formerly CANSIM 282-0074), online: <https://www150. & Lab Rel Rev 246; B.T. Hirsch & R.A. Connolly, “Do
statcan.gc.ca/t1/tbl1/en/tv.action?pid=1410006601>. Unions Capture Monopoly Profits?” (1987) 41:1 Indus &
5. M.L. Blackburn, “Are Union Wage Differentials in the Lab Rel Rev 118; P. Kuhn; “Unions and the Economy: What
United States Falling?” (2008) 47:3 Indus Rel 390; and We Know, What We Should Know” (1998), 31 Can J Econ
B. Bratsberg & J.F. Ragan Jr., “Changes in the Union Wage 1033; M.W. Mitchell & J.A. Stone, “Union Effects on Pro-
Premium by Industry” (2002) 56:1 Indus Lab Rel Rev 65. ductivity: Evidence from Western US Sawmills” (1992) 46:1
Indus & Lab Rel Rev 135; D. Byrne, H. Dezhbakhsh,
6. T. Fang & A. Verma, “Union Wage Premium” (2002) 3:9
& Randall King, “Unions and Police Productivity: An Eco-
Persp Lab & Inc 17.
nomic Investigation”(1996) 35:4 Indus Rel 566; S.G.
7. S. Walsworth & R. Long, “Is the Union Employment Sup- Bronars, D.R. Deere, & J.S. Tracy, “The Effects of Unions on
pression Effect Diminishing? Further Evidence from Firm Behavior: An Empirical Analysis Using Firm-Level
Canada” (2012) 67:4 Indus Rel 654. Data” (1994) 33:4 Indus Rel 426; J. Swanson & K. Andrews,
8. D. Card, T. Lemieux, & W.C. Riddell, “Unions and Wage “Testing the Monopoly Union Model: A Stochastic Frontier
Inequality” (2004) 25 J Lab Res 519; and S. Hayter & Approach” (2007) 46:4 Indus Rel 781; S.E. Black & L.M.
B. Weinberg, “Mind the Gap: Collective Bargaining and Lynch, “How to Compete: The Impact of Workplace Prac-
Wage Inequality” in Susan Hayter, ed, The Role of Collec- tices and Information Technology on Productivity” (2001)
tive Bargaining in the Global Economy: Negotiating for 83:3 Rev Econ & Stat 434; and C. Doucouliagos &
Social Justice (Cheltenham, UK: Edward Elgar Publish- P. Laroche, “What Do Unions Do to Productivity? A Meta-
ing) 136. Analysis” (2003) 42:4 Indus Rel 650. See also J. Bennet &
9. A. Verma, J.G. Reitz, & R. Banerjee, “Unions, Race, Immi- B. Kaufman, What Do Unions Do? A Twenty-Year Perspec-
grants and Earnings: A Longitudinal Examination of the tive (New York: Routledge, 2006).
Effect of Union Membership on the Income Progression of 17. R. Hebdon & T. Brown, Industrial Relations in Canada
Immigrants to Canada,” Intl Migr Rev (forthcoming). (Thomson Nelson, 2008) at 316.
10. T. Thomas, C. Cross, & M. O’Sullivan. “Does Union Mem- 18. M. Grant & J. Harvey, “Unions and Productivity: Conver-
bership Benefit Immigrant Workers in ‘Hard Times’?” gence or Divergence in Perceptions?” (1992) 22:4 Intl Stud
(2014) 56:5 J Indus Rel 611. Mgmt & Org 93.
11. B.T. Hirsch, “The Determinants of Unionization: An An- 19. B. Becker & C.A. Olson, “Unions and Firm Profits” (1992)
alysis of Interarea Differences” (1980) 33:2 ILR Rev 147. 31:3 Indus Rel 395; Bronars, Deere, & Tracy, supra note
12. P. Kumar & C. Schenk, “Introduction” in P. Kumar & 14; R. Batt & T.M. Welbourne, “Performance and Growth
C. Schenk, eds, Paths to Union Renewal: Canadian Experi- in Entrepreneurial Firms: Revisiting the Union-Perfor-
ences (Toronto, ON: University of Toronto Press, 2009). mance Relationship,” in J.A. Katz & T.M. Welbourne, eds,
Advances in Entrepreneurship, Form Emergence and
13. For a complete review of the empirical literature, see S. Growth, Vol. 5: Managing People in Entrepreneurial Or-
Walsworth, “What Do Unions Do to Innovation? An Em- ganizations: Learning from the Merger of Entrepreneurship
pirical Examination of the Canadian Private Sector” and Human Resources Management (Bingley, UK:
(2010) 65:4 Indus Rel 543. Emerald Group Publishing, 2002); and B. Hirsch, “What
14. B.T. Hirsch, “Firm Investment Behavior and Collective Do Unions Do for Economic Performance?” (2004) J of
Bargaining Strategy” (1992) 31:1 Indus Rel 95; J. Godard, Lab Res 415.
“Institutional Environments, Work and Human Resource 20. D.R. Maki & M.L. Meredith, “The Effects of Unions on
Practices, and Unions: Canada vs. England” (2009) 62:2 Profitability: Canadian Evidence” (1986) 41:1 Indus Rel 54;
Indus & Lab Rel Rev 173; S.G. Bronars, D.R. Deere, & J.S. and P. Laporta & A. Jenkins, “Unionization and Profitabil-
Tracy, “The Effects of Unions on Firm Behavior: An Em- ity in the Canadian Manufacturing Sector” (1996) 51:4
pirical Analysis Using Firm-Level Data” (1994) 33:4 Indus Indus Rel 756.
Rel 426; and P.B. Voos & L.R. Mishel, “The Union Impact
on Profits in the Supermarket Industry” (1986) 68:3 Rev 21. C. Doucouliagos & P. Laroche, “Unions and Profits: A
Econ & Stat 513. Meta-Regression Analysis” (2009) 48 Indus Rel 146;
P. Laroche & H. Wechtler, “The Effects of Labor Unions
15. Freeman & Medoff, supra note 3; and D.G. Blanchflower & on Workplace Performance: New Evidence from
R. Freeman, “Unionism in the United States and Other France” (2011) 32:2 J Lab Res 157; and B. Hirsch, “What
Advanced OECD Countries” (1992) 31:1 Indus Rel 56. Do Unions Do for Economic Performance?” (2004) 25 J
16. See, for example, K.B. Clarke, “Unionization and Firm Per- Lab Res 415.
formance: The Impact on Profits, Growth, and Productiv- 22. J.S. Leonard, “Unions and Employment Growth” (1992)
ity” (1984) 74:4 Am Econ Rev 893; B. Becker & C.A. Olson, 31:1 Indus Rel 80.
“Unionization and Shareholder Interests” (1989) 42:2 Indus

23. R. Long, “The Effect of Unionization on Employment 30. D. Audretsch & J.M. Graf von der Schlenburg, “Union
Growth of Canadian Companies” (1993) 46:4 Indus & Lab Participation, Innovation, and Concentration: Results
Rel Rev 691. from a Simultaneous Model” (1990) 146 J Inst & Theor
24. S. Walsworth, “Unions and Employment Growth: The Econ 298.
Canadian Experience” (2010) 49:1 Indus Rel 142. 31. G. Sran, M. Lynk, J. Clancy, & D. Fudge, “Unions Matter:
25. Walsworth & Long, supra note 7. How the Ability of Labour Unions to Reduce Income
Inequality and Influence Public Policy Has Been Affected
26. J. Swanson & K. Andrews, “Testing the Monopoly Union
by Regressive Labour Laws” (2013), Canadian Foundation
Model: A Stochastic Frontier Approach” (2007) 46:4 Indus
for Labour Rights, online (pdf): <https://labourrights.ca/
Rel 781; and S.E. Black & L.M. Lynch, “How to Compete:
sites/default/files/documents/cflr_unions_matter.pdf>;
The Impact of Workplace Practices and Information Tech-
and M. Lynk, “Labour Law and the New Inequality” (2009)
nology on Productivity” (2001) 83:3 Rev Econ & Stat 434.
15 Just Lab 125.
27. A. Verma & T. Fang, “Workplace Innovation and Union
32. R. Gomez & K. Tzioumis, “What Do Unions Do to Execu-
Status: Synergy or Strife?” (Proceedings of the 55th Annual
tive Compensation?” (2006), Centre for Economic Per-
Meeting, Industrial Relations Research Association, Wash-
formance, LSE DP0720.
ington, DC, January 2 – 5, 2003).
33. A. Bryson et al, “Workplace Voice and Civic Engagement:
28. Walsworth & Long, supra note 7.
What Theory and Data Tell Us About Unions and their
29. C.T. Koeller, “Union Membership, Market Structure, and Relationship to the Democratic Process” (2013), 50
the Innovation Output of Large and Small Firms” (1996) Osgoode Hall LJ 965; see also Statistics Canada,
17:4 J Lab Res 683. supra note 1.

C H A P T E R 31
The Unionization Process

II. The Pillars of the Canadian Collective Bargaining Model:
• Explain the significance of the principles of majoritarianism and Majoritarianism and Exclusivity 504
exclusivity in the Canadian collective bargaining regime. III. The Union Organizing Campaign 504
• Describe the typical steps in a union organizing campaign. IV. The Union Certification Process 506
• Describe the key components of the union certification process and A. Jurisdiction and “Trade Union” Status 506
potential issues that can arise during this process. B. Timeliness of Certification Applications 507
• Describe how Canadian labour relations boards decide what an C. Measuring Employee Support for the Union and Collective
“appropriate bargaining unit” is and why this decision is important to Bargaining 508
the collective bargaining model. V. Voluntary Recognition 519
• Explain why certain types of employees are excluded from the right to
unionize, including “managerial” and “confidential” employees.
• Compare the card-check model and the mandatory certification vote
model for measuring whether a majority of employees support collective
bargaining, and identify the jurisdictions that use each model.
• Explain how unions can obtain the legal right to represent workers
through voluntary recognition.
I. Introduction
We are now ready to learn how non-union workers governed by the common law regime
become unionized workers governed by the collective bargaining regime. The process is surpris-
ingly complicated. In a nutshell, unions can earn the legal right to represent employees in two
ways: by obtaining a government-issued licence (union certification) or through voluntary
recognition, whereby the employer agrees to bargain with a union that has not been certified.
The process of unionization varies in details across Canada’s jurisdictions, but the core elements
of the Canadian model are similar. The term “Canadian model” is used with trepidation, because
within Canada a range of occupation-specific models also exist. Construction workers, police,
artists, and agricultural workers are among the types of workers for whom a special and different
collective bargaining model exists in some jurisdictions. We will focus on the model of union-
ization that applies to the vast majority of Canadian employees.
union certification: A government-issued licence that entitles a union to represent employees in a defined bargaining unit
in their relationship with their employer.
voluntary recognition: An arrangement in which an employer elects to recognize and bargain with a union that has not
been certified by the government as the representative of employees.
503

II. The Pillars of the Canadian Collective Bargaining Model:

Majoritarianism and Exclusivity
The American Wagner Act of 1935 (see Chapter 29) introduced a model of collective bargaining
unlike those developing in Europe and the rest of the world.1 It provided that once a union
demonstrates that it has the support of a majority of employees in a bargaining unit—a defined
group of employees of a single employer—then that union becomes the “exclusive bargaining
representative” of all of the employees in the bargaining unit, even those employees who did not
seek the union’s representation or join the union.
The twin concepts of majoritarianism and exclusivity were borrowed and incorporated into
Canadian collective bargaining legislation in the mid-1940s, as explained in Chapter 29, and
remain a pillar of the Canadian model to this day. This is an all-or-nothing model of freedom of
association. If 100 employees are in the bargaining unit and 50 of them desire union representa-
tion, then none of the employees are entitled to collective bargaining, because the union requires
majority support to acquire the legal right to represent employees.2 On the other hand, if 51
percent of employees support unionization, then their decision sweeps the remaining 49 percent
of employees who rejected unionization into the collective bargaining regime. This legal model
encourages a contest for the hearts and minds of employees. That contest begins with a union
organizing campaign.
III. The Union Organizing Campaign

A successful union organizing campaign introduces a new dynamic into employment relations
that will ultimately restrict the authority and discretion employers enjoy in the common law
regime. Not surprisingly, therefore, most employers resist attempts by their employees to union-
ize.3 The process by which employees move from the common law regime to the collective
bargaining regime is usually an adversarial one. Karen Bentham found that 80 percent of Can-
adian employers actively resist attempts by their employees to unionize through both lawful
persuasion in the form of arguments against collective bargaining and, sometimes, unlawful
threats or reprisals against employees who support the union (see discussion of unfair labour
practices in Chapter 32).4 Employees realize that their employer would prefer to remain non-
union, so they usually keep their interest in a union hidden from the employer for as long as
possible.
Workers can create their own union, but more often they join established unions.5 A typical
union organizing campaign begins with private meetings between employees and a professional
union organizer outside of the workplace and hushed conversations at the workplace. Some-
times union organizers make first contact with employees by leaving union flyers on car wind-
shields or approaching employees as they enter or leave the workplace. In other cases, employees
contact a union to ask about organizing a union at their workplace.
bargaining unit: A group of workers whose work is similar enough that they are thought capable to be covered by the same
collective agreement. Importantly, not all bargaining unit members necessarily choose to join the union.
majoritarianism: A principle of the Wagner model, it asserts that a union must secure the support of a majority of employees
to win the right to act as their representative.
exclusivity: A principle of the Wagner model, it asserts that the union chosen to represent workers becomes the sole or exclusive
legal representative for that group of workers.
union organizer: An employee of a union whose principal duties include organizing new workplaces and building union
membership.

Chapter 31 The Unionization Process 505
Once contact is made, union organizers meet with those employees who initially express
interest, usually at the union office or another location away from the workplace, such as a coffee
shop. The organizer will promote the benefits of collective bargaining over individual employ-
ment contracts and explain how an organizing campaign works, including the laws that govern
the process and the requirement for the union to demonstrate to the government that it repre-
sents a majority of the employees. Evidence of employee support is usually collected in the form
of signed union membership cards (similar to the one shown in Figure 31.1 below) or, in some
jurisdictions, union authorization cards, which indicate that the employee wishes the union to
represent them in bargaining with the employer.6 Labour boards are also moving toward accept-
ing electronic union membership evidence, provided that authenticity can be verified.7 Depend-
ing on the jurisdiction, employees may also be required to pay a small fee to the union of
between $1 and $5, which is supposed to signal to the employee that they are making an im-
portant decision and not just signing a petition.8 Some provinces place an expiry date on union
cards. For example, a union card is only valid for one year in Ontario and only 90 days in British
Columbia and Alberta, after which it is said to have become “stale” and the card is not counted.9
FIGURE 31.1 Sample Union Membership Card
USW Member Card.

Source: Reprinted with the permission of United Steelworkers.
Since employers control the workplace, they enjoy virtually unlimited access to employees
during an organizing campaign to convey their views, including through literature, mandatory
group meetings (known as captive audience meetings), and one-on-one conversations during
and outside of work hours. In contrast, unions have no legal right to enter employer property to
speak to employees, except in rare cases such as when employees work and live on employer
union membership card: A document that indicates a worker’s desire to join and become a member of a union.
union authorization card: A document that indicates a worker’s consent and desire to have the union identified on the card
represent them in collective bargaining with an employer.
captive audience meeting: A meeting that employees are ordered by their employer to attend to listen to the employer’s
opinions on whether employees should or should not support unionization.

property (e.g., a remote mine) or when the entrance to the workplace is located in a space where
the public usually has access (e.g., a shopping mall).10 Unlike in Britain, there is no right of
unions to do a presentation to workers at the workplace, or a right to receive contact informa-
tion so unions can send information to workers at their homes, as in the United States.11 In 2017,
the Ontario Liberal government introduced a law entitling unions to a list of employees with “a
phone number and personal email” to facilitate communication during organizing campaigns,
but a newly elected Conservative government quickly repealed the law in 2018.12
Unions attempt to reach workers by standing near the workplace and distributing literature,
and by directing people to websites. Because of the obstacles unions face in communicating
directly with workers at their workplace, unions rely heavily on inside union organizers to
persuade their co-workers to sign union cards. Those cards are then returned to the union orga-
nizer. If the union collects sufficient cards to meet the required legislative threshold (see
Table 31.1 later in this chapter), it can file an application for certification with the applicable
labour relations board.
IV. The Union Certification Process

The “application for certification” initiates a highly complex legal process set out in labour rela-
tions legislation. The precise details of what happens next vary across jurisdictions, but in gen-
eral terms it is the role of labour relations boards to determine whether a union has satisfied the
requirements for certification. Those requirements are mapped out in Figure 31.2 and summar-
ized below. Note that any of these requirements can give rise to legal disputes that require litiga-
tion before a labour relations board.
A. Jurisdiction and “Trade Union” Status

The first task for labour boards when they receive an application for certification is to ensure
that the employer involved falls within their jurisdiction and that the application was filed by a
“trade union.” Provincial labour boards can only process applications relating to employers
within their jurisdiction—the Ontario board cannot deal with a case involving workers in Que-
bec. Nor can a provincial labour board process an application that involves an employer that is
regulated by the federal government, such as banks and telecommunications companies (see
Chapter 17).
Most Canadian collective bargaining statutes permit only “trade unions” to apply for certifi-
cation and not other types of associations.13 Therefore, labour boards must first confirm that a
“trade union” filed the application. When the union involved is well established, its status will
not be questioned. But if the organization is newly formed or lacks history before the labour
board, union status may be challenged. The statutes provide little guidance on what qualifies as
a “trade union,” beyond a requirement that the organization’s objectives include regulating em-
ployee relations through collective bargaining and that the organization be independent of the
employer.14 Labour boards have ruled that to qualify as a “trade union” an organization must
demonstrate a degree of formality, such as by having bylaws or a constitution, and an executive
or officers who have authority to act on its behalf to bargain collective agreements on behalf of
employees.15 A union that is created with the financial support or participation or influence of
the employer (known as a company union) cannot be certified in Canada.16
inside union organizer: An employee who assists in efforts to unionize their own employer.
application for certification: A formal legal document filed by an employee or union with a labour relations board that
commences a process to determine whether the union qualifies to become the legal collective bargaining representative of a
group of employees.
company union: An employee association created with the encouragement or assistance of the employer and that is not
independent of the employer’s control or influence. A company union is often created as a union-avoidance strategy.

FIGURE 31.2 Map of the Union Organizing and Certification Process
Union collects signed cards from Once union has collected enough cards to satisfy
Organizing
employees as evidence of employee the legal threshold, it may file an application for
campaign begins
support for collective bargaining certification with the labour relations board
Once the labour relations board receives the application for certification, it addresses the following issues:
1. Is the application filed in the Provincial labour relations board can only deal with applications involving
correct jurisdiction? workplaces within their province and with employers falling within provincial
jurisdiction. Provincial labour boards cannot deal with applications involving
employers that are regulated by federal labour laws.
2. Is the applicant a “trade Most collective bargaining legislation only permits “trade unions” to file
union”? applications for certification. There are rules about what qualifies as a “trade union.”
3. Is the application “timely”? There are rules about when an application for certification can be filed. Usually if
the workers are not already unionized, there is no time restriction. If the workers
are presently unionized, then an application for certification by another union
(a “raid”) can only be filed during specified “open periods” defined in the collective
bargaining statute.
4. Who is the “true employer”? This is not usually an issue, but it can become one when multiple businesses share
control over employees, such as when employees are assigned by a temporary
placement agency (see Box 31.1).
5. Is the group of workers the In determining the denominator of the Golden Fraction, labour relations
union is seeking to represent boards decide if the unit of workers the union is applying for is “an appropriate
“an appropriate bargaining unit.” Usually the union gets its way, as long as the workers share a “community
unit”? of interest” and the unit would not cause the employer serious labour relations/
human resources problems (see Box 31.2 and Box 31.3).
6. Who are “employees” for the Only “employees” can unionize, and some employees are excluded from
purposes of the application? collective bargaining, including many professionals and employees who exercise
managerial functions or are employed in a confidential capacity relating to labour
relations (see Box 31.4 and Box 31.5).
7. Does the union have the Two models are used in Canada to measure the level of employee support for
required level of support to be collective bargaining:
“certified” as the exclusive 1. Card-check model: The union is certified based on union cards alone if the
bargaining representative of number of cards meets or surpasses the percentage required by the collective
the employees in the bargaining statute.
bargaining unit?
2. Mandatory certification vote model: The union must satisfy two steps.
First, it must submit union membership cards on behalf of at least the
percentage required in the statute to obtain a vote Second, it must win a
certification vote conducted by the labour relations board.
B. Timeliness of Certification Applications

Restrictions exist on when a union can apply for certification, so labour boards must next ensure
that the application is “timely.” These restrictions break down generally as follows:
1. If the employer is not unionized: Any union can apply at any time to represent its
employees. However, there may be a restriction (known as a statutory bar) on a union
that had previously filed an unsuccessful application for certification relating to the
same or similar group of employees rejected in the recent past.17
statutory bar: A rule found in collective bargaining legislation that prohibits an application from being filed for a defined
period of time.

2. If the employer is already unionized: An application for certification by another union

to represent the unionized employees (known as a union raid or displacement applica-
tion) can only be filed during an open period defined in collective bargaining legisla-
tion. A newly certified union is given a grace period of between 6 months (in British
Columbia) and 12 months (in most other jurisdictions) to bargain a first collective
agreement, during which time no other union can apply to displace it as the represent-
ative of the employees in the bargaining unit. When a collective agreement is in effect,
open periods arise during the final months of the agreement. For example, in Ontario,
if the collective agreement is for less than three years, the open period is during the final
three months of the agreement; and if the collective agreement is for greater than three
years, the open period is during months 34 to 36 and then the last three months of every
subsequent year.18 Open periods ensure that a union’s representation rights can be chal-
lenged periodically.
C. Measuring Employee Support for the Union and Collective Bargaining
Assuming that a “trade union” has filed a “timely” application for certification, the labour board
then turns to the crucial issue of assessing the level of employee support for the union. This step
begins with a review of union cards submitted by the union to determine the number of employ-
ees who support the union and want collective bargaining. The union cards are compared to a
list of employees provided by the employer to calculate the percentage of workers who support
collective bargaining. To protect employees from possible reprisals, the identity of the employ-
ees who sign union cards is not disclosed to the employer, although the employer may learn
during the certification process how many or what percentage of employees signed union
cards.19
A simple fraction ultimately determines whether workers have access to the collective bar-
gaining regime. Let’s refer to it as “the Golden Fraction”:
Number of employees who want the union to represent them in collective bargaining
Number of employees eligible to participate in the decision
The numerator is the measure of employee support for unionization. It is measured either by
a count of union cards or through a government-conducted secret ballot vote, as explained
below. The denominator is the total number of employees eligible to participate in the decision,
or the number of bargaining unit employees. A change to either the numerator or denominator
without an equal corresponding change to the other will change the quotient, or percentage of
union support. The composition of the Golden Fraction gives rise to a multitude of potential
legal disputes that are routinely dealt with at labour relations boards across Canada, a few of
which are explored below.
1. Who Is the True Employer?

Usually the identity of the employer is obvious, but not always. Identifying the employer can
prove challenging if control over employees is divided among multiple businesses, such as when
union raid: An attempt by one union to organize workers who are represented by another union.
open period: A period of time defined in a collective bargaining statute during which a union may apply to displace another
union as the representative of a group of employees, or during which unionized employees may file an application to “de-certify”
the union.
bargaining unit employee: An employee whose job falls within a bargaining unit that a union either represents or is
seeking to represent.

work is performed by workers engaged by a subcontractor or supplied by a temporary place-

ment agency. Are workers sent to company X by a temporary placement agency employees of
company X or the temporary placement agency? The answer can matter greatly to the outcome
of a union organizing campaign at company X. If the “temps” are company X employees, then
their wishes count for the purposes of determining whether the union has majority support. In
deciding which business is the employer, labour boards focus on who exercises control and au-
thority over the employees while they are performing the work.20 An example is described in
Box 31.1.

Identifying the True Employer
United Food and Commercial Workers International 2.
the party bearing the burden of remuneration;
Union, Local 1000A v. Nike Canada Ltd. 3.
the party imposing discipline;
2006 CanLII 24724 (Ont. LRB) 4.
the party hiring the employees;
5.
the party with authority to dismiss the employees;
Key Facts: The union applied for certification to represent 6.
the party who is perceived to be the employer by the
employees at a Nike distribution centre. The certification law employees; and
in Ontario required the union to demonstrate that at least 7. the existence of an intention to create the relationship
40 percent of the employees in the bargaining unit were union of employer and employee.
members to qualify for a certification vote. When the union
filed its application for certification, there were 70 full-time Nike The temps were under the direct control of Nike super-
employees in the factory and an additional 180 workers sup- visors in the performance of their work there. Even though the
plied by Manpower, a temporary employment supplier temps were paid by Manpower, Nike effectively determined
(“temps”). The contract between Nike and Manpower identified the rate of pay. Nike supervisors gave warnings to the temps,
Manpower as the temps’ employer. However, in its response to and Nike could effectively dismiss a temp by instructing Man-
the application for certification, Nike argued that it was the power to no longer send that temp to Nike. Manpower hired
temps’ employer. The union argued that Manpower was the the temps, but Nike put new temps on a probationary period
employer. If the temps were Nike employees, then they would and could elect not to keep a temp. Therefore, the hiring cri-
be employees in the bargaining unit, and the union would not teria did not represent a strong indicator in this case. Some
have the requisite 40 percent to obtain a certification ballot. longer-service temps perceived Nike to be their employer, but
Issue: Was Nike or Manpower the true employer of the temps many of the temps who had spent less time at Nike perceived
for the purpose of the Ontario Labour Relations Act? Manpower to be their employer. Weighing all of these factors,
the board decided that the true employer was Nike, since it
Decision: The Ontario Labour Relations Board ruled that Nike had ultimate control over the temps at Nike, including disci-
was the true employer. Citing the leading case on the identi- plinary power and the authority to set the wage rate. With the
fication of the employer in Ontario, York Condominium Corp.,* temps added to the denominator in the Golden Fraction, the
the Ontario Labour Relations Board considered the following union no longer had membership cards on behalf of 40 per-
factors in its determination: cent of the employees, and its application for certification was
dismissed.
1. the party exercising direction and control over the
employees; * [1977] Ont. LRB Rep. Oct. 645.
Collective bargaining legislation grants labour relations boards discretion to declare two or
more businesses to be related employers for collective bargaining purposes. For a related em-
ployer declaration to be made, the board requires that four conditions be met: (1) there must be
related employers: Two or more companies ruled by a labour relations board to be carrying out associated or related activities
under common direction and control and, therefore, to be a single employer for collective bargaining purposes.

more than one business entity; (2) the entities concerned must carry on associated or related
activities; (3) those activities must be carried out under common control or direction; and
(4) there must be a labour relations reason to make the common employer declaration.21 For
example, in the case of Metro Waste Paper Recovery in Ontario, Metro used a temporary em-
ployee agency (KAS) to supply almost all of its employees at a factory in Whitby.22 A union
applied to represent Metro employees at the factory, but the employer argued that all of the
employees worked for KAS. In addition to arguing that Metro was the “true employer,” the
union also argued that KAS and Metro were related employers. The Ontario Labour Relations
Board agreed, finding that the two companies were carrying on related activities at the Whitby
factory under common control and direction, and that it would be difficult for the union to
bargain with just one of the companies. The union was certified to represent employees of both
companies at the Whitby factory.
2. Is the Group of Employees That the Union Is Seeking to Represent an

“Appropriate Bargaining Unit” for Collective Bargaining Purposes?
The denominator in the Golden Fraction is the total number of employees eligible to participate
in the unionization decision, or the voting constituency. Labour boards decide which employees
are entitled to participate in the unionization decision by deciding what is an appropriate bar-
gaining unit. In general, an appropriate bargaining unit is a grouping of jobs that the labour
relations board believes should be bundled together for the purposes of collective bargaining.
For example, a union applying to represent employees at a Canadian Tire store might propose a
bargaining unit like this:
The Union applies to represent all employees of Canadian Tire at 123 Junction Avenue, in the City
of Toronto, except Automotive Service employees, Department Supervisors, and persons above the
rank of Department Supervisor.
Assume that there are 60 employees that fall within that proposed bargaining unit, and the
union has signed cards on behalf of 36 of them (or 60 percent). The union looks to be in good
shape in a model that requires the union to demonstrate 50 percent or more support to be
certified.
However, the employer might argue in its response that the union’s proposed bargaining unit
is not appropriate. For example, it might claim that an appropriate bargaining unit should
include all four Canadian Tire stores in Toronto owned by the same franchisor, or at the very
least it should include the automotive service employees and department supervisors at the store
named by the union. If the employer wins any of those arguments, then the denominator in the
Golden Fraction would increase, and unless the union has supporters among the added employ-
ees, the percentage of workers who support the union will decrease. For example, if the labour
board rules that an appropriate bargaining unit includes the 20 automotive service employees at
the one store in addition to those the union initially sought, and none of those employees sup-
port the union, the denominator in the Golden Fraction increases to 80 and the union’s support
level falls to 43.7 percent (36/80), which is less than a majority.
Sometimes legislation provides direction to labour boards on what the bargaining unit
should be or cannot be.23 To provide one example, in Nova Scotia, the Trade Union Act requires
two or more manufacturing facilities of the same employer to be treated as a single bargaining
unit if the facilities are “interdependent.”24 This law is commonly referred to as the “Michelin
appropriate bargaining unit: A grouping of jobs or employees that a labour relations board decides is suitable to be
represented together in collective bargaining.

Amendment” because its purpose was to impede unionization of several large Michelin tire
factories.25 The government was concerned the tire company would leave the province if its
workers unionized. The requirement for the union to organize a majority of employees at all of
the Michelin plants has proven to be an insurmountable hurdle to collective bargaining.
Situation-specific rules such as the “Michelin Amendment” are found in collective bargain-
ing legislation across the country. However, mostly labour boards are granted broad discretion
to determine what is an “appropriate bargaining unit,” and there is a huge body of (not very
interesting yet) important case law explaining how they go about this task. The question of
appropriate bargaining unit is important because it influences both whether a union will be
successful in organizing a workplace and also whether, once organized, the unit will be strong
enough to bargain sustainable collective agreements (see Box 31.2).

Appropriate Bargaining Units: Union Organization Versus Viable Collective Bargaining
Structures
How a labour relations board defines the bargaining unit is bargaining structure and it also serves as the basis
crucial to the potential success of the application for certifica- for organization. Combined with this has been the
tion, as well as the future viability of the collective bargaining realization that these two functions often pull in
relationship. If a bargaining unit includes only a small subgroup opposite directions, the former in favour of large
of a company’s employees, it may be easier for the union to (broad based) units and the latter in favour of smaller
organize, but once certified the bargaining unit may have very (easier to organize) units. The whole struggle has
little bargaining power vis-à-vis the employer. A larger bargain- been to reconcile these conflicting forces.*
ing unit usually has more bargaining power and therefore
greater collective bargaining viability than a smaller bargaining Labour relations boards seek to balance these competing
unit. However, a larger bargaining unit is also much harder to forces when they determine which bargaining units are ap-
organize. Professor Brian Langille explains this tension: propriate for bargaining.
[T]he bargaining unit serves at least two functions. * B. Langille, “The Michelin Amendment in Context” (1981) 8 Dal LJ 523
It serves as the basis for the formation of a long-term at 539.
Unions are usually given wide berth in defining the unit of employees they would like to
represent. The legal test is whether the bargaining unit proposed by the union in the application
for certification is an appropriate bargaining unit, not whether it is the best bargaining unit that
the labour relations board could imagine. However, the union does not have carte blanche to
decide the type of bargaining unit. Labour boards must decide whether the bargaining unit
proposed by the union makes good “labour relations sense.”
Labour boards have typically emphasized that an appropriate bargaining unit is one in which
employees share a community of interest, meaning that their work, employment-related inter-
ests, and geography (where they work) are sufficiently aligned that it makes labour relations
sense for those workers to bargain together as a group.26 Applying the concept of community of
interest, labour boards historically separated blue-collar factory workers from white-collar office
and clerical workers, and part-time from full-time employees, although these distinctions are
less rigidly applied today.27 More recently, at least in Ontario, the “nebulous concept of com-
munity of interest” has become less important because, to use the words of the Ontario Labour
community of interest: A common test used by labour boards in assessing whether a proposed bargaining unit is appropriate
for collective bargaining; it asks whether the workers share sufficient commonality that grouping them together makes labour
relations sense.

Relations Board, “all employees share a community of interest by virtue of working for the same
employer.”28
Unions usually prefer the largest bargaining units they can realistically organize, and there-
fore labour boards tend to give unions the bargaining unit they propose, except when that unit
would cause the employer “serious labour relations problems,” as noted recently by the Ontario
Labour Relations Board:
To be blunt, the test is one which clearly favours the [union’s] preference, and in order to overcome
that preference, [the employer] will generally be required to demonstrate serious labour relations
harm.29
The most common of such problems includes the undue fragmentation of bargaining units
that could leave the workplace carved up into little pockets of bargaining units, each with their
own collective agreement. The employer could end up bargaining dozens of little collective
agreements, and a strike by any one of the units could interrupt business for everyone. For ex-
ample, a unit of six shipping and receiving employees in a large factory is unlikely to be an
appropriate unit, since it makes little labour relations sense to separate them from a larger bar-
gaining unit of all factory workers.
Labour boards are also concerned about separating employees into different bargaining units
when there is a history of regular interchange of employees in and out of the proposed unit or
where there is functional integration of the proposed unit with other parts of the business.30 In
these situations, practical human resources issues arise when employees are covered by a collec-
tive agreement some days and not others, or when a strike by workers in one bargaining unit
would effectively shut down the work performed by the other bargaining unit. These issues can
arise most vividly when there are multiple locations of the same employer within a similar geo-
graphical area, as considered in the case discussed in Box 31.3.

What Is an Appropriate Bargaining Unit at Tim Hortons?
United Food & Commercial Workers, Local 206 v. Lynn Decision: No. The Ontario Labour Relations Board ruled that a
Management Ltd. unit of just one store was not appropriate in this case due to
[1999] Ont. LRB Rep. Nov 19; reconsideration denied 2000 the high degree of integration between the various stores
CanLII 1574 (Ont. LRB) owned by the employer. There was a sufficient “community of
interest” among employees at individual stores and among
Key Facts: The union applied to represent employees at one employees of all 11 stores to create a viable collective bargain-
Tim Hortons’ store in Hamilton, Ontario. The store was a fran- ing relationship owing to the similar work and human re-
chise of Tim Hortons Limited and the owner/employer (Lynn sources practices that are fairly standard across the Tim
Management) also owned 10 other Tim Hortons’ franchises Hortons chain. However, carving out one store from the other
within a 10-kilometre area. The employer argued that the ap- 10 would cause “serious labour relations problems” for the
propriate bargaining unit includes all 11 stores it owns. The employer. The board concluded:
union did not have adequate employee support to be certified
in any bargaining unit larger than just the one store it had [T]he Board must balance the statutory goal of
applied to represent. employee self-organization with the goal of pro-
Issue: Was the union’s proposed bargaining unit consisting of moting certain bargaining structures. The Board
the one Tim Hortons’ store an appropriate bargaining unit? judges whether the [union’s] proposed unit is an
appropriate unit rather than the most appropriate
undue fragmentation: A legal test used by labour boards to decide whether a proposed bargaining unit is inappropriate
because it would carve up the workplace into too many relatively small groups of workers, creating practical business difficulties
for the employer.

unit. In that context, the Board may find that its control of the principals of Lynn Management; hiring of
concern for employee access to collective bargain- employees at the various stores was centralized to a degree
ing outweighs the potential for serious labour rela- by the involvement of Lynn managers; and employees oc-
tions problems. That is the balancing exercise casionally moved from store to store to pick up or cover
necessitated in judging whether the applicant’s shifts. The board ruled that the close integration of the 11
single-store unit is an appropriate unit in this case. stores rendered a single-store unit inappropriate for collec-
[Emphasis added] tive bargaining, although it acknowledged that absent such
integration, a single store may be appropriate. Since the
In this case, the employer used common cooking facilities union lacked sufficient support in any unit larger than the
to supply doughnuts to all 11 stores; the stores shared sup- single unit it applied for, the board dismissed the application
plies and had a unified management system under the for certification.
The decision considered in Box 31.3 demonstrates the importance of the bargaining unit
decision. By deciding that a unit comprising a single Tim Hortons’ store is not appropriate,
the Ontario Labour Relations Board effectively prevented employees at that store from access-
ing collective bargaining. Those employees could only access the collective bargaining regime
if the union could also persuade a majority of employees at the other ten stores to also join
the union. While a single store may be easier to organize, single-store bargaining units of a
large employer that operates many stores usually lack the bargaining power to achieve strong
collective agreements. This basic truism explains in large measure why unions have had great
difficulty growing collective bargaining coverage in the private service sector.31 We will return
to this important issue again when we consider collective bargaining and the right to strike in
Chapter 34.
3. Who Is an “Employee” for the Purpose of Union Certification Applications?

In Chapter 4 we discussed the importance of identifying employment status, since most statutes
designed to protect workers in fact only apply to “employees.” This is true too of collective bar-
gaining statutes. The task of distinguishing between an “employee” and an “independent con-
tractor” is simplified in some jurisdictions (including Ontario and British Columbia) by a broad
statutory definition that includes dependent contractors.32 As explained in Chapter 4, a de-
pendent contractor is a worker who exhibits greater autonomy and independence than a typical
employee, yet who nevertheless remains economically dependent and largely under the control
of one business. For example, Canadian labour relations boards have ruled that taxi and limo
drivers, bike couriers, and truck drivers are dependent contractors and entitled to unionize,
even though they exhibit far more independence than a typical employee.33 Box 31.4 considers
a recent case concerning whether “gig” workers are dependent contractors. Even in jurisdictions
that do not expressly include “dependent contractor” in the definition of “employees,” labour
relations boards have applied a broad application of “employee status” that emphasizes eco-
nomic dependence.34
dependent contractor: A worker whose status falls in between that of an employee and an independent contractor. This
worker has more autonomy and independence than a typical employee, yet remains economically dependent on one customer
for income and is subject to considerable control at the hands of that customer.


Are Gig Workers Dependent Contractors Who Can Unionize?
The sight of food couriers making deliveries
on bicycles or in cars has become a very com-
mon one in Canadian cities. However, this
small but burgeoning new sector of today’s
service economy—a good example of the
“gig economy,” in which workers are freelance
or short term, instead of permanent—has
become a new legal battleground.
Delivery workers for German-based com-
pany Foodora, one of the leading app-based
food delivery services in North America, have
recently been trying to unionize, citing the
precarious nature of their work and their
central role in the company’s operations. The
somewhat unique nature of this quasi-inde-
pendent work, its technology-based nature,
and its newness as an employment sector,
has made the question of unionization a dif-
ficult one.
In the fall of 2019, a series of hearings
began at the Ontario Labour Relations Board
intended to determine the status of Foodora
workers in their efforts to join the Canadian
Union of Postal Workers (CUPW). The workers A Foodora delivery rider makes his way through city traffic.
had been a presence at the hearings, showing Source: Bayne Stanley/ZUMA Wire/Alamy Live News.
up in their trademark bright pink shirts.
Their legal arguments hinged on the question of whether of gig work can make companies such as Foodora an attractive
Foodora workers are “dependent contractors” who are econom- place for many to work, it comes at the cost of modest wages,
ically reliant on the Foodora app that is the foundation of the instability, and little in the way of negotiating leverage. Hence
company’s business model. Under Ontario law, “dependent the push towards unionization.
contractors” are treated as employees for the purposes of the On February 25, 2020, the OLRB ruled in the workers’ favour.
right to unionize and engage in collective bargaining. Drivers It is considered a landmark, precedent-setting case, and may
for Uber, another app-based enterprise, have also begun mak- be a boon to a young generation of workers facing a scarcity
ing efforts towards unionization in some jurisdictions. In Janu- of good jobs. Foodora workers are hopeful that other workers,
ary 2020, more than 300 Uber Black drivers working out of seeing their success, will realize that they also have the poten-
Toronto’s Pearson International Airport became the first ride- tial to improve their working lives.
sharing workers to pursue unionization, via the United Food
and Commercial Workers Union. Sources: Based on Sara Mojtehedzadeh, “Future of Gig Economy Workers at
Foodora argues that their drivers are “independent con- Stake in Foodora Couriers’ Unionization Battle” Toronto Star (10 September
2019), online: <https://www.thestar.com/news/gta/2019/09/10/future-of-
tractors” in business for themselves, with a good deal of free- gig-economy-workers-at-stake-in-foodora-couriers-unionization-battle.
dom to set their own hours and decide where they work, and html>; Sarah Treleaven, “The Gig Economy Keeps Growing, but its Workers
who are therefore not eligible to unionize. While the flexibility are Fed Up,” Maclean’s (11 December 2019).
Some employees are expressly excluded from the right to unionize in collective bargaining
legislation, including various professionals such as lawyers, medical doctors, and engineers.35
There are two types of employees that are excluded in every Canadian jurisdiction:
(1) employees who exercise managerial functions (managerial exclusion); and
managerial exclusion: A common exclusion from the definition of “employee” in collective bargaining legislation that has
the effect of excluding employees who exercise managerial functions from the protected rights to collective bargaining made
available to other employees by that legislation.

(2) employees who are engaged in a confidential capacity in matters relating to labour rela-
tions (confidential employee exclusion).
Governments defend these exclusions on the basis that a conflict of interest or loyalties would
arise if these employees could unionize, since their allegiance should be to the employer.36
Employees are divided into two teams, and those who wield real authority over subordinates are
assigned to the employer’s team, as are employees who regularly have access to confidential
labour relations information that would be of value to the union’s team.
In applying the managerial exclusion, labour boards in Canada have looked for evidence that
the employee either (1) holds a senior management position with independent authority to
make decisions on policy or the running of the company or (2) exercises real meaningful control
over the livelihood of subordinate employees.37 An employee’s job title means very little; the
legal question is whether the person actually makes effective decisions about hiring, firing, dis-
ciplining, and promoting workers. Simple supervisory tasks like scheduling or directing work
are not usually enough to bring a person into the managerial exclusion. The person must have
the authority to make decisions that substantially impact employees’ wages, job assignments,
and job security.38 The fact that an employee sometimes makes recommendations to manage-
ment about hiring, firing, promotions, and discipline does not alone signal that the person
exercises managerial functions. However, if in fact management always or usually follows those
recommendations, then a labour relations board is likely to find that the employee makes “ef-
fective managerial decisions” and is excluded. Consider the case presented in Box 31.5.

The Managerial Exclusion
Langley City Foods Ltd. v. United Food and Commercial Issue: Did the assistant store managers exercise managerial
Workers International Union, Local No. 1518 functions such that they fell within the managerial exclusion
2006 CanLII 22075 (BCLRB) and therefore were not entitled to unionize?
Key Facts: The union applied to be certified for a bargaining Decision: No. The BC Labour Relations Board ruled that
unit of employees at a grocery store. It argued that two em- the assistant store managers did not exercise sufficient
ployees with the job title “assistant store manager” should be managerial authority over the employees to bring them into
excluded because they exercised managerial functions and the managerial exclusion. The board summarized its approach
therefore were not “employees.” The assistant store managers to the managerial exclusion as follows:
supervised the grocery department, which is the largest de-
partment at the store; attended management meetings; were the Board focuses on whether the person in question
responsible for running the store when the owner, Lee, was exercises effective determination of decisions related
away; investigated employee wrongdoing and reported their to discipline and discharge or whether they provide
findings to Lee; and made recommendations to Lee about labour relations input. In addition, the Board consid-
whether probationary employees should be kept on, which ers whether the individual makes decisions regarding
Lee usually followed. Lee did the hiring, and there was no evi- hiring, promotion or demotion. The Board has com-
dence that the assistant store managers had ever disciplined mented that the common theme identified is wheth-
anyone. The employer argued that notwithstanding their job er the individual exercises powers that are capable of
title, the assistant store managers were really just low-level having a significant impact on the career of an em-
supervisors with little real authority over the other bargaining ployee. …[R]egardless of how often the individual
unit employees and therefore should be included in the bar- imposes discipline, if the individual makes the effect-
gaining unit. ive determination of disciplinary decisions that is
sufficient to exclude the person as a manager.
confidential employee exclusion: A common exclusion from the definition of “employee” in collective bargaining legislation
that has the effect of excluding employees who exercise confidential labour relations - related functions from the protected rights
to collective bargaining made available to other employees by that legislation.

In this case, although the assistant store managers ran the ees, but they had little real authority to make decisions that
store when Lee was away, all important decisions relating to affected the working lives of the employees. Therefore, the
hiring, promotion, discipline or dismissal, and wages and assistant store managers were included in the bargaining unit,
benefits were still made by Lee. The assistant store man- and their ballots in the certification vote were to be
agers were conduits of information to Lee about the employ- counted.
The “confidential employee” exclusion is very narrow.39 It excludes from the collective bar-
gaining statute only those employees whose (1) regular, core duties (2) involve handling confi-
dential information of a nature related to industrial relations that is not otherwise available to
the union or employees in the bargaining unit, and (3) that would compromise the employer if
disclosed to the union.40 For example, a person whose regular job duties involve participating
in management meetings to discuss employer collective bargaining or grievance strategies
would be excluded, but a worker who only has incidental contact with collective bargaining in-
formation probably would not be excluded under this ground.
4. Measuring Employee Support for Collective Bargaining: The Card-Check

Model and the Mandatory Certification Vote Model
Once a labour board has determined the appropriate bargaining unit, it directs its attention to
testing whether a majority of the employees in that unit support collective bargaining. Two
models are used in Canada to measure whether a union has majority employee support: (1) the
card-check model (with a fallback certification vote option) and (2) the mandatory certifica-
tion vote model. Table 31.1 describes in which jurisdictions the models are used (as of January
2020).
TABLE 31.1 Proving Majority Support for Collective Bargaining in Canada

(Non-Construction Industries)
Jurisdiction Card-Check Certification Certification Vote Ballot Details:
1. Required percentage of employees in the bargaining
unit who are union members in order to qualify for a
certification vote.
2. Vote outcome needed for certification.
Canada Yes, if more than 50% of the bargaining unit 1. 35% support.
(federal) employees are union members.
2. The union must win the majority of ballots cast.
Alberta No. 1. 40% support.
British No. 1. 45% support.

Columbia
card check: A method used in Canadian collective bargaining legislation to measure the level of employee support for union-
ization that involves counting the number of union membership or authorization cards. If a majority of employees have signed
cards, then the union is certified without a certification vote.
mandatory certification vote: A method used in Canadian collective bargaining legislation to measure the level of employee
support for unionization that involves the government conducting a secret ballot vote of bargaining unit employees.

Manitoba No. 1. 40% support.
New Brunswick Yes, if 60% or more of employees in the bargain- A certification vote “may be” ordered if a union applies with the
ing unit are union members. If between 50% and support of between 40% and 60% of employees in the bargaining
59% of employees in the bargaining unit are unit. The union must win the majority of ballots cast.
union members, the board “may” certify the
union.
Newfoundland No. A certification vote is ordered if a union submits evidence that at

and Labrador least 40% of employees in the bargaining unit wish the union to
represent them. The union must obtain votes on behalf of a ma-
jority of employees in the bargaining unit or a majority of employ-
ees who cast ballots (provided at least 70% of employees in the
bargaining unit cast ballots).
Nova Scotia No. 1. 40% support.
Ontario No (available only in the construction sector). 1. 40% support.
Prince Edward Yes, if more than 50% of bargaining unit employ- A certification vote “may be” ordered if a union applies with the
Island ees are union members. support of less than 50% of employees in the bargaining unit. The
union must win the majority of ballots cast.
Quebec Yes, if more than 50% of bargaining unit employ- A certification vote “may be” ordered if a union applies with the
ees are union members. support of between 35% and 50% of employees in the bargaining
unit. The union must win the majority of ballots cast.
Saskatchewan No. 1. 45% support.
In the card-check model, a union can demonstrate majority support without a vote by col-
lecting union cards demonstrating support for the union on behalf of a specified majority of
bargaining unit employees (see Table 31.1). Once the union proves to the labour board that it
has reached the required majority threshold, the board can certify the union. In jurisdictions
using a card-check model, there is a fallback option for a union to demonstrate majority support
by a vote conducted by the labour relations board if the union demonstrates substantial support
that nevertheless falls short of the majority threshold. The threshold level of support required
for card-check-based certification ranges from a simple majority (Prince Edward Island, Que-
bec) to 60 percent (New Brunswick).
The mandatory certification vote model involves a two-step process. First, the union must
collect union cards from a specified percentage (from 35 to 45 percent, depending on the juris-
diction) of bargaining unit employees to qualify for the second step, a mandatory certification
vote conducted by the labour relations board. The union must then win the vote.41 The votes are
held relatively quickly—in most jurisdictions within seven to ten business days of the date of the
union’s application for certification.42 Any issues that require litigation are deferred until after
the vote is held, although the vote results may be ordered to remain sealed until that litigation
concludes. This “quick vote” model is designed to avoid a protracted, divisive, and disruptive
campaign prior to the vote and to limit the opportunity for employers to use their power to
pressure employees to turn against collective bargaining.43
The decision by Canadian governments regarding which model to use is a highly political
one because the choice is not outcome neutral, as explained in Box 31.6.44 As Professor Paul

Weiler of Harvard University observed, the model a government adopts “tends either to facili-
tate or to frustrate collective bargaining.”45 Studies demonstrate that union success rates in
certification applications are lower under a mandatory certification vote model than under a
card-check model. Therefore, governments that desire less collective bargaining coverage and
weaker unions favour the mandatory certification vote model, whereas governments that sup-
port easier access to collective bargaining prefer the card-check model. Consequently, which
model prevails at any moment in time and place depends in large measure on which “perspec-
tive” (see Chapter 3) dominates the political landscape.

The Politics of Measuring Employee Support for Collective Bargaining
For about four decades prior to the 1990s, governments of all the union organizer may have tricked the employee into sign-
political stripes supported the card-check model of union ing, or the employee may have signed due to peer pressure or
certification as a sensible and efficient method of testing em- in ignorance of the implications of signing the card. Third, they
ployee wishes. The industrial pluralist perspective dominated argued that a mandatory vote is needed to ensure that the
the political climate and prevailing academic sentiments dur- employer can present “the other side of the story” to employ-
ing this period, as discussed in Chapter 3. ees, to offset the sales job of union organizers. Finally, propo-
The argument in favour of the card-check model ran along nents of the mandatory certification vote model argued that
the following lines. If a clear majority of employees are union replacing the card-check model with the mandatory vote
members, then there is little point wasting taxpayers’ money model would create new jobs (although how or why it would
and prolonging the start of collective bargaining to conduct a do so is neither obvious nor fully developed).†
second test of majority wishes in the form of a vote. The main What is clear is that union success rates in mandatory cer-
effect of requiring a vote is to enable employers to engage in tification vote proceedings are lower and certification applica-
a campaign to defeat collective bargaining. In that campaign, tions are fewer in jurisdictions using a mandatory certification
employers enjoy substantial advantages in terms of access, vote model. For example, one study found that the move to
control, and power over employees, and many employers can- the mandatory certification vote model in British Columbia
not resist the temptation to exploit that power by threatening between 1984 and 1993 led to a 19 percent decrease in union
employees’ jobs if they support a union. The card-check model success rates in certification applications. ‡ Another study
reduces the opportunity for employers to interfere with em- found a 10 percent decrease in union success rates after On-
ployees’ decisions about whether to try collective bargaining, tario switched from the card-check model to the mandatory
because unions can often obtain majority membership, or certification vote model.§ The politics surrounding the choice
come close to it, without the employer learning of the organ- of model provides a vivid example of the important role the
izing campaign. political subsystem plays in shaping the work law subsystem
Card-check model advocates also emphasize that union (Chapter 2).
certification simply grants a union a “licence” to try to bargain
a collective agreement that a majority of employees would * R. Epstein, “The Case Against the Employee Free Choice Act”
vote for in a ratification vote (see Chapter 33). If a union cannot (University of Chicago Law and Economics Olin Working Paper No. 452,
do that, either it will walk away or the employees will vote 2009), online: <http://papers.ssrn.com/sol3/papers.cfm?abstract_
id=1337185>.
it out.
The card-check model came under increasing attack begin- † See, for example, the speech by Ontario Minister of Labour Elizabeth
ning in the late 1980s and then into the 1990s by employers Witmer introducing Bill 7 in 1995, which introduced the mandatory
certification vote for the first time in Ontario: Legislative Assembly of
and politicians as the neoclassical and managerialist perspec-
Ontario, Debates (Hansard), October 18, 1995, online: <https://www.ola
tives ascended.* Critics of the card-check model made four .org/en/legislative-business/house-documents/parliament-36/
basic arguments. First, they argued that the card-check model session-1/1995-10-18/hansard#P314_84629>.
is “undemocratic” because it does not ensure that every em-
‡ C. Riddell, “Union Certification Success Under Voting Versus Card-Check
ployee has a chance to participate in the unionization decision. Procedures: Evidence from B.C.” (2004) 57 Indus & Lab Rel Rev 493.
Second, they argued that a union membership card is not a
§ S. Slinn, “An Empirical Analysis of the Effects of the Change from Card-
guarantee of actual support for collective bargaining because
Check to Mandatory Vote Certification” (2004) 11 CLELJ 259.

In 1990, all jurisdictions except Alberta and Nova Scotia permitted card-check certification.
At the time of writing this edition in 2020, card-check certification was permitted only in the
federal jurisdiction, Quebec, New Brunswick, Prince Edward Island, and Newfoundland and
Labrador (but only if the employer and union agree), and in the construction sector in Ontario.
This may have changed by the time you are reading this chapter, given how the choice of model
is so clearly linked to political trade winds.
V. Voluntary Recognition

Most of this chapter was devoted to the union certification process, which nowadays is the most
common method by which a union becomes legally entitled to represent employees in collective
bargaining. However, prior to the introduction of statutory union certification in the 1940s,
unions and employers engaged in collective bargaining after the employer had voluntarily rec-
ognized the union. Collective bargaining legislation did not eliminate voluntary recognition,
but rather supplemented it by introducing a process to compel employers to bargain with a
union that represents a majority of its employees.46
In voluntary recognition, the employer agrees to recognize the union as the representative of
its employees and to begin collective bargaining. Today (except in Quebec)47 an employer and
union can bypass the formal union certification process by agreeing to voluntary recognition.
This process can avoid the formality, litigation, hostility, and expense often associated with the
certification process. On the other hand, voluntary recognition creates the possibility of “sweet-
heart deals” between employers and friendly unions that do not put the employees’ interests
first. Moreover, there is no guarantee that a voluntarily recognized union actually has the sup-
port of a majority of employees. Therefore, the statutes include checks and balances on volun-
tarily recognized unions to ensure employees are protected.48 For example, during the early
stages of a voluntary recognition, and especially before a collective agreement is concluded,
unions may be challenged by affected employees and be required to demonstrate they have ma-
jority employee support.49 Voluntarily recognized unions are not granted the grace period
(referred to above under the heading “Timeliness of Certification Applications”) provided to
certified unions to bargain a first collective agreement.
In some jurisdictions, the right of voluntarily recognized unions (and the employees repre-
sented by them) to lawfully strike is also restricted.50 This restriction results from a requirement
for unions to satisfy various preconditions before they can lawfully strike, including exhausting
government-mandated conciliation. In some jurisdictions, only certified unions are granted the
statutory right to access conciliation, with the result that voluntarily recognized unions will
never be in a legal strike position. Therefore, it is important to study the applicable statute care-
fully to learn whether there are differences in the legal rights of voluntarily recognized unions
compared to certified unions.
VI. Chapter Summary

This chapter examined the complex process through which Canadian employees can move from
the common law regime to the collective bargaining regime. Most of the time, this process
involves joining a union, which then must satisfy a list of statutory prerequisites to achieve
union certification. However, we noted too that unions can also obtain the right to bargain col-
lective agreements on behalf of employees through voluntary recognition. The chapter also
explained some of the big debates that have always surrounded the legal process of certification.
Big debates surround the extent to which unions should have access to the employees they are

seeking to organize, the importance and role of the bargaining unit description, and the impact
of the card-check and mandatory certification vote models on access to collective bargaining. In
this chapter, we begin to see the complexity of the collective bargaining regime.

1. Describe the “card-check” and “mandatory certification vote” models for determining em-
ployee support. Under which model do unions have a greater probability of success in an
organizing campaign? Which model is in effect in your home province?
2. What are arguments for and against the card-check model?
3. Describe factors that labour boards consider when deciding whether an employee is
excluded from collective bargaining legislation because they
a. exercise managerial functions or
b. are confidential employees.
4. Explain what factors labour boards consider when deciding whether a bargaining unit is
appropriate for collective bargaining. Why is the decision about which bargaining unit
is appropriate important in the Canadian collective bargaining model?
5. What concerns arise in relation to voluntary recognition? How are those concerns
addressed, if at all, in Canadian collective bargaining law?
APPLYING THE LAW

The Retail Workers Union has applied for certification to rep- 3. The department managers spend most of their work-
resent non-union employees of a Walmart store in your proving time performing the same work as retail floor staff,
ince. There are 85 employees broken down as follows: except they also prepare the schedules for the floor
staff in their area, approve breaks and lunch periods,
30 Retail floor sales staff and report any problems with the floor staff, such as
20 Cashiers lateness or other misbehaviour to the HR manager. De-
10 Warehouse workers partment managers also attend weekly meetings with
10 Department managers the HR manager and the other managers to discuss
10 Office staff the store’s performance and various other workplace
3 Assistant store managers policies. Why might the employer want to argue in its
1 Human resource manager response to the application for certification that the
1 Store manager bargaining unit should include department managers?
4. Is there any risk to the employer in making that
The union has applied for the following bargaining unit: “All argument?
employees of Wal-Mart Canada at 123 Main Street, except the 5. If the union argues that department managers are ex-
Store Manager, HR Manager, Assistant Store Managers, office cluded from the right to unionize because they “exer-
staff, and Department Managers.” cise managerial functions,” do you think the union
would be successful?
1. Which employees are in the bargaining unit that the
6. Assume that the department managers do not exer-
union is applying to represent? How many employees
cise managerial functions, and therefore they have a
are in the union’s proposed bargaining unit?
right to unionize. The employer wants them to be in-
2. In your province, how many union cards does the
cluded in the bargaining unit. What argument might
union need to submit to the labour relations board
the employer make to the labour board to persuade
with its application for certification in order to (1) ob-
the board to include the department managers in the
tain a union certification vote or (2) obtain card-check
bargaining unit?
certification, if that option is available in your province?


1. See M. Barenberg, “The Political Economy of the Wagner 12. See Bill 148, Fair Workplaces, Better Jobs, 2017, s. 6.1(9),
Act: Power, Symbol, and Workplace Cooperation” (1993) online (pdf): <http://www.ontla.on.ca/bills/bills-files/41_
106 Harv L Rev 1381; and R. Adams, “Union Certification Parliament/Session2/b148_e.pdf>. Repealed by Bill 47,
as an Instrument of Labor Policy: A Comparative Perspec- Making Ontario Open for Business Act, 2018, Schedule 2.
tive” in S. Friedman et al., eds, Restoring the Promise of 13. PC 1003 recognized both “employees’ associations” and
American Labor Law (Ithaca, NY: ILR Press, 1994) 260. “trade unions,” but over time reference to “employee asso-
2. Mounted Police Association of Ontario v. Canada, 2012 ciations” was dropped from most Canadian collective bar-
ONCA 363 at para 26. gaining legislation: Wartime Labour Relations Order (PC
3. Not all employers resist their employees’ efforts to 1003), s. 4. Some exceptions exist, such as the Ontario
unionize. In 2007, Magna International entered into an Agricultural Employees Protection Act, 2002, SO 2002,
agreement with the Canadian Auto Workers union that c. 16, s. 1. This act protects a right of agricultural workers
granted the union access to the workplace and required to join an “employees’ association.”
the employer to remain neutral and speak encouragingly 14. For example, the Alberta Labour Relations Code, supra
about the prospects of employees joining the CAW. In note 6, s. 1, defines a “trade union” simply as “an organiza-
exchange, the union agreed, among other things, to tion of employees that has a written constitution, rules or
never strike. See M. Malin, “Canadian Auto Workers— bylaws and has as one of its objects the regulation of rela-
Magna International, Inc. Framework of Fairness tions between employers and employees.”
Agreement: A U.S. Perspective” (2010) 54 Saint Louis U 15. See, for example, ABC Climate Control Systems, [2009]
LJ 525. Ont. LRB Rep. Sept/Oct 639; Local 199 UAW Building
4. K. Bentham, “Employer Resistance to Union Certification: Corp, [1977] OLRB Rep. 472; and Kubota Metal Corpora-
A Study of Eight Jurisdictions” (2002) 57 Indus Rel 159. tion Fahramet Division, 1995 CanLII 10060 (Ont. LRB) at
5. For a recent attempt by employees to form their own para 35. See also D. Doorey, “Graduated Freedom of Asso-
union, see the story of WestJet Airlines’ pilots in T. ciation: Worker Voice Beyond the Wagner Model” (2013)
Johnson & K. Bakx, “WestJet Pilots Vote Against Forming 38 Queen’s LJ 511 at 521-26.
Union,” CBC News (August 2015), online: <http://www 16. See, for example, Ontario Labour Relations Act, 1995, SO
.cbc.ca/news/business/westjet-pilots-vote-against-forming 1995, c. 1, Sched. A, s. 15 [Ontario LRA]; and Manitoba
-union-1.3180420>. Labour Relations Act, CCSM, c. L10, s. 43. A company
6. See the Alberta Labour Relations Code, RSA 2000, c. L-1, union is not illegal in Canada (as it is in the United States),
s. 33, on the option of union membership cards or union but it lacks the legal status necessary to enter into binding
authorization cards. contracts or to appear as a party in legal proceedings. See
D. Taras, “Reconciling Differences Differently: Employee
7. Re WestJet and WestJet Professional Pilots Assn. (2015), 283
Voice in Public Policy Making and Workplace Govern-
CLRBR (2d) 175; and Working Enterprises Consulting &
ance” (2007) 28:2 Comp Lab L & Pol’y J 167.
Benefits Services Ltd. and UFCW, Local 1518, Re (2016),
274 CLRBR (2d) 96. 17. The length of the statutory bar is either left to the sole dis-
cretion of the labour relations board (e.g., in Nova Scotia
8. Ontario, British Columbia, Manitoba, Newfoundland and
and Prince Edward Island) or specified in the jurisdiction’s
Labrador, and Saskatchewan do not require a union mem-
labour relations legislation (ranging from three months in
bership fee. See P. Weiler, Reconcilable Differences: New
Quebec and British Columbia to one year in Ontario and
Directions in Canadian Labour Law (Toronto, ON: Car-
Saskatchewan), but usually allows the labour relations
swell, 1980) at 42 for a discussion of the purposes of the
board some discretion to reduce the period of time.
payment requirement.
18. Ontario LRA, supra note 16, s. 7(5).
9. See BC Regulation 7/93, s. 3; The Salvation Army, 2018
CanLII 25402 (Ont. LRB); and Alberta Labour Relations 19. Ibid., s. 13 (the identity of union members is not to be dis-
Code, supra note 6, s. 33(b). closed to the employer).
10. P. Macklem, “Property, Status, and Workplace Organizing” 20. See, for example, Pointe-Claire (City) v. Quebec (Labour
(1990) 40 UTLJ 74; and RMH Teleservices v. BCGEU, 2003 Court), [1997] 1 SCR 1015; Sylvania Lighting Services, 1985
BCSC 278. CanLII 1016 (Ont. LRB); Kraft Canada, 2007 CanLII
48336 (Ont. LRB); and Alberta Health Services, 2011
11. See, for example, Cadillac Fairview Corp. Ltd. v.
CanLII 62488 (Alta. LRB).
R.W.D.S.U. (C.A.), 1989 CanLII 4334 (Ont. CA) at 208. See
also D. Doorey, “Union Access to Workers During Organ- 21. See, for example, Sobey’s Ontario Division of Sobey’s Capital
izing Campaigns: A New Look Through the Lens of B.C. Inc., 2001 CanLII 10338 (Ont. LRB); White Spot Ltd. v.
Health Services” (2008) 15 CLELJ 1 at 17-22. British Columbia Labour Relations Board et al., 1999

BCCA 93; RPKC Holding Corporation, 1986 CanLII 1501 30. See, for example, Clean Harbors Lodging Services LP, 2014
(Ont. LRB); Penmarkay Foods Ltd. (1984), 8 CLRBR (NS) CanLII 38737 (Alta. LRB); and Lynn Management Ltd.,
203; and Etobicoke Public Library Board, [1989] OLRB 2000 CanLII 1574 (Ont. LRB) (one Tim Hortons’ store is
Rep. Sept 935. not an appropriate unit when the franchisee owns ten
22. Metro Waste Paper Recovery Inc., 2009 CanLII 60617 (Ont. other nearby stores).
LRB). See also PPG Canada Inc., 2009 CanLII 15058 (Ont. 31. See E. Lennon, “Organizing the Unorganized: Unioniza-
LRB). Sometimes it is the employer that wants a related tion in the Chartered Banks of Canada” (1980) 18
employer application in order to expand the size of the Osgoode Hall LJ 177; A. Forrest, “Organizing Eatons: Do
bargaining unit and defeat a certification application: the Old Laws Still Work?” (1988) 8 Windsor YB Access
Hornco Plastics, 1993 CanLII 8031 (Ont. LRB). Just; and D. Doorey, “Why Unions Can’t Organize Retail
23. For example, it is common for collective bargaining legis- Workers,” online, Law of Work (blog): <http://lawofwork
lation to instruct labour relations boards that a unit con- .ca/?p=7061>.
sisting solely of “dependent contractors,” “professionals,” or 32. See, for example, BC Labour Relations Code, RSBC 1996,
employees with special technical skills (“craft units”)— c. 244, s. 1 and Ontario LRA, supra note 16, s. 1 for statu-
such as electricians or bricklayers—is appropriate, while a tory definitions of “dependent contractor.” For a discussion
unit consisting of “private constables” along with other of the origins of and justification for the “dependent con-
employees is not (Canada Labour Code, RSC 1985, c. L-2, tractor” definition, see H. Arthurs, “The Dependent Con-
s. 27(6)). The Ontario LRA provides that a bargaining unit tractor: A Study of the Legal Problem of Countervailing
that comprises security guards and the employees they Power” (1965) 16:1 UTLJ 89.
monitor may be appropriate, but the labour relations 33. See, for example, Hamilton Cab, 2011 CanLII 7282 (Ont.
board is directed to decide whether placing those two LRB); Kelowna Cabs (1981) Ltd., BCLRB No. 230/85;
groups of employees in the same unit would create a con- and Flash Courier Services Inc., 2002 CanLII 52815
flict of interest: supra note 16, s. 14. (BCLRB).
24. Nova Scotia Trade Union Act, RSNS 1989, c. 475, s. 26. 34. See, for example, 331001 Alberta Ltd. (Barrel Taxi), 2011
25. B. Langille, “The Michelin Amendment in Context” (1981) CanLII 62486 (Alta. LRB); and United Cab Ltd., [1996]
8 Dal LJ 523 at 539. SLRBR No. 24. But see 603968 N.B. Inc. (Air Cab), 2003
26. The following factors are relevant in assessing whether a CanLII 64176 (NBLEB).
“community of interest” exists among workers in a pro- 35. See, for example, Ontario LRA, supra note 16, s. 3; and PEI
posed bargaining unit: (1) similarity of skills, interests, Labour Act, RSPEI 1988, c. L-1, s. 7(2). An occupation
duties, and working conditions; (2) the physical and ad- excluded from one collective bargaining statute might
ministrative structure of the employer; (3) functional inte- nevertheless be covered by another statute governing col-
gration of the work and employees; and (4) geography. See lective bargaining in a particular industry or profession.
Island Medical Laboratories (1993), 19 CLRBR (2d) 161; Whether these exclusions violate the Canadian Charter of
and Red Chris Development Company Ltd., 2019 CanLII Rights and Freedoms is an open question (see Chapter 39).
68603 (BCLRB). For a fuller discussion of how Canadian 36. Borough of Etobicoke (Hydro Electric Commission), 1981
labour relations boards determine appropriate bargaining CanLII 790 (Ont. LRB); and Corporation of District of
units, see G. Adams, Canadian Labour Law, 2nd ed Burnaby, [1974] 1 CLRBR 1 (BCLRB).
(Aurora, ON: Canada Law Book, 1993) at chapter 7.
37. Cottage Hospital (Uxbridge), 1980 CanLII 939 (Ont. LRB);
27. Red Carpet Food Systems Inc., 2001 CanLII 5016 (Ont. and AltaLink Management Ltd., 2012 CanLII 43190
LRB); and Metroland Printing Publishing and Distributing (Alta. LRB).
Ltd., 2003 CanLII 33962 (Ont. LRB).
38. Cowichan Home Support Society, BCLRB No. B28/97
28. Burns International Security Services Limited, 1994 CanLII (leave for reconsideration of BCLRB Nos. B100/95,
9898 (Ont. LRB). See also Active Mold Plastic Products Ltd., B179/95, and B217/95, 34 CLRBR (2d) 121); Alpine Con-
1994 CanLII 9940 (Ont. LRB); Hospital for Sick Children, fections Canada, ULC Operating as Dynamic Chocolates,
1985 CanLII 899 (Ont. LRB); Metroland Printing Publish- 2005 CanLII 47795 (BCLRB); Borough of Etobicoke (Hydro
ing and Distributing Ltd., supra note 27; and Sodexo Electric Commission), supra note 36; Ken Bodnar Enter-
Canada Ltd., 2012 CanLII 1502 (BCLRB). prises Inc., 1994 CanLII 9954 (Ont. LRB); Royal Camp
29. Aim Health Group Inc., 2014 CanLII 46041 (Ont. LRB) at Services, 2016 CanLII 21306 (Alta. LRB); and Reynolds-
para 60; Quality Tree Service, 2016 CanLII 90799 (Ont. Lemmerz Industries, 1995 CanLII 9988 (Ont. LRB).
LRB); Canadian Union of Public Employees v. Hospital for 39. Labour Relations Board v. Canada Safeway Ltd., [1953] 2
Sick Children, supra note 28; and National Energy Board v. SCR 46; and Corporation of District of Burnaby, supra
Public Service Alliance of Canada, 2003 PSSRB 79. note 36.

40. See discussions of the application of the “confidential em- Procedures: Evidence from B.C.” (2004) 57 Indus & Lab
ployee” exclusion in Gateway Casinos & Entertainment Rel Rev 493; S. Slinn, “An Empirical Analysis of the Effects
Inc., 2010 CanLII 27987 (BCLRB); Calgary Board of Edu- of the Change from Card-Check to Mandatory Vote Certi-
cation, 2013 CanLII 21674 (Alta. LRB); Peel Children’s Aid fication” (2004) 11 CLELJ 259; and S. Johnson, “Card
Society, 2015 CanLII 57037 (Ont. LRB); Southern Health— Check or Mandatory Representation Vote? How the Type
Santé Sud, 2015 CanLII 37991 (Man. LRB); and Battlefords of Union Recognition Procedure Affects Union Certifica-
and District Co-operative Limited, 2015 CanLII 19983 tion Success” (2002) 112 Econ J 344.
(Sask. LRB). 46. See, for example, Alberta Labour Relations Code, supra
41. In Newfoundland and Labrador, the statute specifies that note 6, s. 42. See the discussion by Chief Justice Laskin (in
the union must either obtain votes on behalf of more than dissent) in Beverage Dispensers & Culinary Workers Union,
50 percent of eligible voters (so a person who does not Local 835 v. Terra Nova Motor Inn Ltd., [1975] 2 SCR 749.
vote counts as a “no” vote) or win the vote provided that at 47. Quebec Labour Code, CQLR c. C-27, s. 1(b) (only a
least 70 percent of all eligible voters must have cast ballots: “certified association” is recognized by the labour relations
Newfoundland and Labrador Labour Relations Act, RSNL board).
1990, c. L-1, s. 38.
48. See the discussion of voluntary recognition provisions in
42. Collective bargaining statutes usually include a defined Ontario in Penegal Trim & Supply Ltd., 2000 CanLII 12309
time frame for the conducting of certification ballots, such (Ont. LRB).
as in s. 8(5) of the Ontario LRA, which directs that votes
49. See, for example, Ontario LRA, supra note 16, s. 63(1) (a
be held five business days after the application for certifi-
“certified union” is protected from displacement applica-
cation is filed. In Saskatchewan, the statute does not
tions for one year after certification); the Saskatchewan
specify a time frame, but in practice the labour relations
Employment Act, SS 2013, c. S-15.1, s. 6-10(3); and Nova
board has been conducting votes 13 days, on average, after
Scotia Trade Union Act, supra note 24, s. 30 (a voluntarily
the application for certification: see Saskatchewan Labour
recognized union that concludes a collective agreement is
Relations Board, “Annual Report for 2018 – 19,” online:
treated as a certified union, subject to employees challeng-
<http://www.sasklabourrelationsboard.com/pdfdoc/2018
ing whether the union has majority support during the
-19%20Annual%20Report>.
first 30 days of the agreement).
43. See the discussion in Weiler, supra note 8 at 44-45.
50. Canada Labour Code, supra note 23, ss. 48, 49 (only a cer-
44. See, for example, F. Martinello, “Mr. Harris, Mr. Rae, and tified union or a union that has concluded a collective
Union Activity in Ontario” (2000) 26 Can Pub Pol’y 17; H. agreement can give notice to bargain, which is a condition
Jain & S. Muthu, “Ontario Labour Law Reforms: A Com- of accessing conciliation, a prerequisite to a lawful strike).
parative Study of Bill 40 and Bill 7” (1996) 4 CLELJ 311; In Ontario, a union that enters into a voluntary recogni-
and K. Burkett, “The Politicization of the Ontario Labour tion agreement in writing may access government concili-
Relations Framework in the Decade of the 1990s” (1998) 5 ation and the strike provisions of the legislation: see
CLELJ 168. Ontario LRA, supra note 16, s. 18(3).
45. Weiler, supra note 8 at 48. See also C. Riddell, “Union Cer-
tification Success Under Voting Versus Card-Check


C H A P T E R 32
Unfair Labour Practices and

the Right to Organize
II. Why a Statutory “Right to Unionize”? 525
• Explain the origins of unfair labour practice provisions in Canada and
III. The Substance of Unfair Labour Practice Provisions Regulating
how they modify the common law. Employer Behaviour 526
• Explain the substance of unfair labour practice provisions and how they A. The Intimidation and Coercion Prohibition and “Anti-Union
restrict employer conduct during union organizing campaigns. Animus” 527
• Explain the difference between “motive” and “non-motive” unfair labour B. The Interference and Domination Prohibition 529
practices. IV. Employer Expression Rights 532
• Explain what “anti-union animus” means and why it is important. V. Remedies for Unfair Labour Practices 535
• Explain the scope of employer free speech rights in the context of union
organizing campaigns.
• Describe the range of remedies available to Canadian labour relations
boards to redress unfair labour practices committed by employers during
union organizing campaigns.
I. Introduction
In preceding chapters, we learned that in the common law regime, workers who supported
unions and expressed a desire for collective bargaining were frequently targeted for reprisals by
resistant employers. Employers could fire employees who supported unions or refuse to hire
them outright. Such behaviour was usually lawful in a system based purely on freedom of con-
tract. However, if workers can be fired for joining a union, then they don’t have much of a right
to unionize. Protecting workers from reprisals is a necessary condition for any model of free-
dom of association for workers. Therefore, restrictions prohibiting various forms of unfair
labour practices were included in 1940s and 1950s collective bargaining legislation and remain
a fundamental pillar of the emerging right to organize.
This chapter explores the history and scope of unfair labour practice provisions found in
Canadian collective bargaining statutes, focusing on how the law regulates employer behaviour
during the period of union organizing campaigns. In later chapters, we will consider how the
law regulates the behaviour of unions and of employers once a union is legally entitled to repre-
sent an employer’s workers.
II. Why a Statutory “Right to Unionize”?

By threatening or punishing union supporters, an employer might bring an abrupt end to a
union’s burgeoning organizing campaign.1 If the employees believe that support for collective
525

bargaining threatens their jobs, they will be less likely to support the union. Therefore, for an
employer desiring to avoid collective bargaining, terminating union supporters or threatening
other punishment may make perfect business sense. Unfair labour practices were enacted to
protect workers from such reprisals and to reduce industrial conflict that sometimes resulted
when workers were fired for supporting collective bargaining.
Almost all employers resist unionization campaigns in some manner, even if most do not
resort to firing employees. Professor Karen Bentham found that 80 percent of Canadian employ-
ers engaged in “actions that unmistakably evince open opposition to union certification.”2 And
studies have shown that employer opposition, particularly when it includes threats to employee
job security, can be effective at thwarting unionization efforts. For example, Professor Terry
Thomason found that the probability of a union winning a union certification application fell
by 8 to 13 percent when the employer committed an unfair labour practice in Ontario and Que-
bec, jurisdictions that were using the card-check model of certification at the time of the study.3
Professor Chris Riddell found that employer unfair labour practices reduced union success rates
in certification applications by 21 percent in British Columbia, where the mandatory certifica-
tion vote model was in effect.4
The Supreme Court of Canada has recognized that in order to exercise the right to organize,
employees require statutory protection from employer threats and reprisals. In the 2001 deci-
sion of Dunmore v. Ontario (Attorney General), the Supreme Court wrote:
history has shown, and Canada’s legislatures have uniformly recognized, that a posture of govern-
ment restraint in the area of labour relations will expose most workers not only to a range of unfair
labour practices, but potentially to legal liability under common law inhibitions on combinations
and restraints of trade.5
The Supreme Court cited with approval a leading Canadian labour law text, which noted that
prior to the enactment of modern unfair labour practice provisions, “the freedom to organize
would amount ‘to no more than the freedom to suffer serious adverse legal and economic con-
sequences.’”6 By the late 1930s and then into the early 1940s, Canadian governments were finally
accepting—albeit often reluctantly and under intense pressure from increasingly militant work-
ers—that employees should have a right to organize and that this right, to be meaningful,
needed to be accompanied by government intervention in the form of restrictions on the right
of employers to punish employees who supported collective bargaining.
III. The Substance of Unfair Labour Practice Provisions Regulating

Employer Behaviour
An amendment to the Criminal Code in 1939 criminalized the refusal by an employer to employ
a worker who joins an employee association as well as any threat or intimidation by an employer
intended to compel a worker to abstain from joining an association.7 However, prosecutions
under that criminal provision were rarely pursued, and the enactment was more symbolic of
growing tolerance of collective worker activities than substantive in practice. Recall from Chap-
ter 29 that the United States had enacted the Wagner Act in 1935, which granted employees
protection from employer reprisals for associational activity. By the late 1930s, Canadian work-
ers and unions were demanding nothing less for themselves.
The Wartime Labour Relations Order, or Order in Council PC 1003, was passed in 1944 in
Canada and established the basic framework of the Wagner Act in this country (as discussed in
Chapter 29). Section 4 of PC 1003 introduced a general statute-based right to associate:
Every employee shall have the right to be a member of a trade union or employees’ organization and
to participate in the lawful activities thereof.

Chapter 32 Unfair Labour Practices and the Right to Organize 527
To give effect to that general right, PC 1003 also included, among other provisions, a duty to
bargain (see Chapter 33) and two categories of restrictions on employer conduct (unfair labour
practices) that could impede the right to organize:
1. Intimidation and coercion prohibition: It prohibited employers from punishing workers

who join or support employee associations, either by refusing to employ them or by
imposing conditions in their contracts that seek to restrain the employee from exercis-
ing any rights protected by the legislation.
2. Interference and domination prohibition: It prohibited employers from providing “finan-
cial or other support” to an employee association and from dominating or interfering
with the formation or administration of employee associations.8
The first category addressed the reality that employers (usually) have both an interest in see-
ing an organizing campaign fail and the power to see that it does. The second category was
aimed at protecting the right of employees to select their own association that is independent of
the employer, and to have that union represent them without meddling from the employer.
These elements of PC 1003 remain the fundamental building blocks of the modern-day statu-
tory right to unionize. Next, we take a closer look at the sorts of behaviour they prohibit.
A. The Intimidation and Coercion Prohibition and “Anti-Union Animus”

Threats can take many forms, including physical and economic threats. Consider section 96 of
the Canada Labour Code as an example of a typical non-intimidation clause:
No person shall seek by intimidation or coercion to compel a person to become or refrain from becom-
ing or to cease to be a member of a trade union.9 [Emphasis added]
Notice the motive element in that section: it matters why the threat was made. The threat must
be for the purpose of compelling people to refrain from exercising rights protected by the col-
lective bargaining statute, such as joining a union or engaging in union-related activities.10 If I
threaten to bop a co-worker in the nose unless he gives me $20, I may be committing a crime or
giving my employer grounds to fire me, but I am not committing an unfair labour practice.
However, if I threaten to bop him if he does not sign a union membership card, then I am violat-
ing collective bargaining legislation. When an employer acts against an employee in some nega-
tive manner because the employee is or is believed to be a union supporter, this is called acting
with anti-union animus. Anti-union animus is the term used in labour law to describe the
motive element of the unfair labour practice.
Thankfully, physical threats or violence during union organizing campaigns are relatively
uncommon in Canada nowadays. A more frequent problem concerns economic threats, which
include comments or actions that cause employees to believe that supporting collective bargain-
ing poses a threat to job security or working conditions. The provisions in collective bargaining
legislation that prohibit threats, intimidation, and coercion are intended to police economic
threats.
economic threat: A comment or action intended to signal that economic harm (including job loss or other loss of a work-
related benefit) will result unless a specific course of conduct is taken.
anti-union animus: The motive element of unfair labour practices; it means acting with an intention to defeat or undermine
the exercise of lawful activities by a union or union supporters.

The non-intimidation provisions prohibit employers from disciplining, threatening, or firing

an employee for joining a union or supporting collective bargaining.11 Often there is no direct
evidence—no “smoking gun”—that the employee or union can point to that definitively proves
that the employer knew the employee was a union supporter. The union will not usually have a
witness who is present when the employer decides to take action against an employee. However,
labour relations boards will draw inferences from the circumstances surrounding the events, as
described in the case examined in Box 32.1.

Can a Labour Board Infer Anti-Union Motive (Animus) in the Absence of Direct Evidence?
Marv Jones Honda v. International Association of Issue: Was the decision to terminate Napora tainted by anti-
Machinists & Aerospace Workers District Lodge 250 union animus and therefore a violation of the BC Labour Rela-
2015 CanLII 5787 (BCLRB) tions Code?
Key Facts: Napora worked as an automotive technician at a Decision: Yes. The board rejected the employer’s argument
company called Marv Jones Honda for about three years. He that it was unaware of the union organizing campaign, drawing
had concerns about his working conditions, and he met with an adverse inference of anti-union animus from the suspicious
an organizer for the Machinists Union to learn about the pro- timing and circumstances surrounding the termination:
cess of organizing a union. At that meeting, Napora signed a
union membership card and agreed to act as an inside union I have found it to be more probable than not the
organizer at the workplace. But a few days later, Napora’s em- Employer terminated Napora due to anti-union ani-
ployment contract was suddenly terminated. The employer mus. While there is no direct evidence his dismissal
argued that it fired Napora for a variety of performance-related was motivated by anti-union animus, I find anti-
reasons and was unaware that there was a union campaign union animus can be pieced together from the cir-
underway or that Napora was involved in it. The union filed an cumstances of his termination. The following
unfair labour practice.

comments from Forano Limited, [1974] 1 CLRBR 13, The crux of such an unfair labour practice case is the
are instructive in making this decision: employer’s motivation in the discharge, something
An employer cannot fire someone for his union which rarely will be disclosed by admissions. Em-
membership or activities. That does not mean that ployers don’t ordinarily advertise their anti-union
employees are immune from discharge during or- activities. Such intention must be pieced together
ganizational campaigns since they can be fired for from a pattern of circumstantial evidence.
proper cause. It does mean that some such legitimate
cause must be the actual reason for the discharge … The employer was ordered to reinstate Napora to his former
If the real purpose of a firing was the union in job and to compensate him for all financial losses for the period
volvement, an employer may not search for some from his termination until his reinstatement and to post the
arguable justification in the employee’s earlier be board’s decision in the workplace where it can be seen by the
haviour and advance this as the cause, ex post facto. workers.
In some Canadian jurisdictions, labour relations legislation creates a “reverse onus” in cases
alleging adverse treatment of union supporters that presumes the employer acted unlawfully
unless it can come forward with a compelling explanation of why its actions were completely
free of anti-union animus.12 An employer’s actions are said to be “tainted by anti-union animus”
if any part of the motivation for the action was to avoid unionization or collective bargaining,
even if there are also other reasons for the action.13
B. The Interference and Domination Prohibition

Consider the italicized portion of section 70 of the Ontario Labour Relations Act, which is typ-
ical of the non-interference and domination sections in other Canadian collective bargaining
statutes (we will consider the second part of this section, the employer expression part, later in
the chapter):
No employer or a person acting on behalf of an employer … shall participate in or interfere with the
formation, selection or administration of a trade union or the representation of employees by a trade
union or contribute financial or other support to a trade union, but nothing in this section shall be
deemed to deprive an employer of the employer’s freedom to express views so long as the employer
does not use coercion, intimidation, threats, promises or undue influence. [Emphasis added]
These non-interference provisions perform two important functions in the pursuit of a

legally protected right to organize.
1. Encouraging Independent Unions and Preventing Employer Domination

The non-interference provisions protect the right of employees to select representation by an
independent union of their own choosing. An independent union is an association that is at
arm’s length from the employer and not under the control and influence of the employer (i.e.,
not a company union). An employer that lobbies employees to support a specific union it per-
ceives to be more friendly than another is unlawfully interfering in the selection of a union.14
The non-interference provisions operate in tandem with other provisions in the statutes that
prohibit associations with employer support from being certified; entering into collective agree-
ments; and acting as a bar to an application for certification by a real, independent union (see
Chapter 33).15 The result is that employee associations that receive employer support contrary
independent union: A union that is at arm’s length and independent from the control of any employer.
company union: An employee association created with the encouragement or assistance of the employer and that is not
independent of the employer’s control or influence. A company union is often created as a union-avoidance strategy.

to the non-interference provisions are not recognized as “trade unions” and therefore have no
legal status under collective bargaining statutes.16 The objective of the law is to ensure that
employers cannot use their power to impede workers from joining or forming truly independent
unions of their own choosing.
Not every instance of employer support of a union is unlawful. Labour relations boards apply
what they call a purposive approach to statutory interpretation. That means they keep in mind
that the purpose of the law is to discourage company unions, and therefore consider whether
the employer’s support actually interfered with the ability of employees to make a free choice to
join an independent union. Applying this test, boards have ruled that it was not unlawful for an
employer to provide a list of employees to a union seeking to organize its employees, to invite a
union to organize its employees, or to permit union organizing at the workplace, provided that
the union involved is independent and at arm’s length from the employer and the employer’s
actions did not interfere with the ability of employees to freely choose whether to support the
union.17
2. Preventing Employer “Interference” with the Functioning of the Union

The non-interference provisions also prohibit employers from engaging in behaviour that
undermines the union’s efforts to organize and to represent workers after the union has been
certified. For example, labour relations boards have ruled that the following employer conduct
unlawfully “interferes” with union activities:
• attempting during the hiring and recruitment process to screen out employees who may
be union supporters;18
• refusing to provide a certified union with contact information for employees in the bar-
gaining unit and information about their terms of employment;19
• bargaining working conditions directly with employees instead of their union;20
• refusing to collect and remit union dues to the union in accordance with a union dues
clause in a collective agreement; and21
• restricting an employee from taking a position as a union official.22
The non-interference provisions also give labour relations boards an important tool to deal
with employer actions that, while not motivated by anti-union animus, nevertheless have a sub-
stantial negative impact on unions and the right to organize. Review section 70 of the Ontario
Labour Relations Act reproduced above. Notice that unlike the “intimidation and coercion”
unfair labour practices discussed earlier in the chapter, the non-interference provision does not
include a motive element. If an employer intends to interfere with a union, then it is acting with
an anti-union animus and is in violation of the non-interference provisions, and probably one
or more “intimidation and coercion” sections too. However, an employer can violate the non-
interference provisions without having a specific intention to undermine a union or its employ-
ees’ efforts to organize.23 This type of action is known as a non-motive unfair labour practice.
This does not mean that every decision an employer makes that disadvantages unions and
employees seeking collective bargaining is unlawful. Labour boards have applied a balancing
test of sorts to determine when employer actions that lack anti-union animus nevertheless
unlawfully interfere with union rights.24 The Ontario Labour Relations Board explained the test
this way in the 1998 case of Canadian Union of Public Employees v. Carleton University:
... the test requires a balancing between the “business purpose” behind the employer’s conduct and
the union’s “protected activity” which may have been interfered with.25 [Emphasis added]
purposive approach to statutory interpretation: An approach to interpreting and applying a statutory provision that is
guided by the purpose of the provision.
non-motive unfair labour practice: A type of unfair labour practice that does not require the presence of anti-union animus.

In applying this test, labour relations boards first ask whether employees or union officials
were engaged in a “protected activity,” including union organizing. If so, then the board considers
the “business purpose” behind the employer’s decision or rule. If the employer’s business purpose
is considered weak or unpersuasive, and there is disproportionate harm to the “protected activity”
of the union or its supporters, a violation of the non-interference provision may be found, even
though the employer’s intention was not specifically to interfere with the protected activity.26
For example, in the case of Canadian Paperworkers Union v. International Wallcoverings, an
employer violated the non-interference provision when it fired union-supporting employees not
because of their union activity, but based on the mistaken belief that they had engaged in mis-
conduct during a strike.27 In that case, the employer’s business purpose was non-existent, since
it had acted on a mistaken belief about employee misconduct. Consider how the Ontario Labour
Relations Board balanced the property rights of a mall owner against the right to organize in the
decision discussed in Box 32.2.

Employer Property Rights Versus the Right to Organize
Cadillac Fairview Corp. Ltd. v. R.W.D.S.U.
1989 CanLII 4334 (Ont. CA)
Key Facts: The Retail, Wholesale and Department Store Union

(RWDSU) commenced an organizing campaign of employees
of Eaton’s, the flagship retail store at the Eaton Centre in To-
ronto. The only access to the doors where employees entered
and exited the workplace were in the mall, which was owned
by Cadillac Fairview (CF). Union organizers, some days with the
help of then Toronto alderman Jack Layton,* set up at those
doors before the store opened and before the public entered
the space to distribute literature to employees entering work.
Eventually, CF enforced the mall’s “no solicitation” policy to
exclude all such leafletting and organizing on mall property. It
Source: Travel Pictures/Alamy.
ordered its security guards to remove the union organizers. The
union filed an unfair labour practice complaint alleging that erty rights in general, are not absolute and must be weighed
CF was “interfering in the formation of a union” contrary to against the legal right to organize. The business purpose for
what is now section 70 of the Ontario Labour Relations Act. The the application of the “no solicitation” policy was weak or non-
relevant portion of section 70 reads as follows: existent here, since the union’s organizers were not interfering
with any mall business—they were active before the mall
No employer … and no person acting on behalf of an opened in an area generally open to the public, but when the
employer or an employers’ organization shall participate public was not present. On the other hand, accessing the mall
in or interfere with the formation, selection or adminis- was essential for the union organizers since it was the only
tration of a trade union… .† [Emphasis added] realistic way that the organizers could identify and communi-
cate with workers at this workplace. In the absence of a busi-
Issue: Did CF unlawfully interfere in the formation of a union ness justification, the employer’s attempt to exclude union
by banning union organizers from the Eaton Centre? organizers from the mall constituted unlawful interference
with the formation of a union.
Decision: Yes. The OLRB ruled that CF had violated section 70
of the Labour Relations Act, and that decision was upheld by
* Jack Layton, who would later lead the federal New Democratic Party,
the Ontario Court of Appeal. The OLRB ruled that CF was a
was convicted for trespassing because he refused to leave the Eaton
“person acting on behalf of” Eaton’s when it enforced its “no Centre when ordered to do so by CF security. Layton was helping the
solicitation” policy and, therefore, that section 70 applied to union organizers. His conviction was later overturned: see R v. Layton,
the actions of CF. CF may have valid, business-related reasons 1986 CanLII 4717 (Ont. Prov Ct).
for having and enforcing a “no solicitation” rule at its malls that † Ontario Labour Relations Act, 1995, SO 1995, c. 1, Sched. A, s. 70.
are unrelated to union activity. However, that rule, and prop-

IV. Employer Expression Rights

Employers are not completely silenced during a union organizing campaign. The unfair labour
practice provisions carve out an exception that protects a limited right of employers to campaign
against unionization. For example, employers can prohibit union organizing during working
hours, when the employees should be performing their jobs.28 They can enforce their property
rights to exclude professional union organizers (with some exceptions, such as when workers
live on employer-controlled property or the only access to the workers is by entering employer
property, such as in the case of shopping malls).29 And in general terms, employers are permit-
ted to express opinions about unions and collective bargaining, provided that they do not use
threats, intimidation, or coercion (or “undue influence” in most jurisdictions) and do not make
promises, such as promising benefits if employees reject collective bargaining. Whether employ-
ers should have a protected right to campaign in this way has long been debated, as described
in Box 32.3.

Should Employers Have a Protected Right to Campaign Against Collective Bargaining?
In 1968, the report of the Task Force on Labour Relations (the ployer’s choice of vice-president of industrial rela-
Woods Report) examined the state of collective bargaining law tions is off limits to the employees.†
and recommended reforms. The report recommended limiting
employer speech during union organizing campaigns: However, the argument that employers should be re-
strained from campaigning on the side of employees who do
An employer who opposes certification of a union not want collective bargaining has generally not prevailed
should be limited to defending his record as em- under contemporary Canadian law. As discussed in this chap-
ployer through the statement of facts, and to rebut- ter, the law generally permits employers to campaign against
ting union allegations and promises without threat unionization as long as they do not engage in threats, coercion,
or promise of future action.* intimidation, and, in some jurisdictions, “undue influence.”
Arguments advanced in favour of permitting non-coercive
Professor Paul Weiler, one of Canada’s leading labour law employer campaigning include (1) the employer’s interests are
scholars and adjudicators, similarly argued that employers affected to a substantial degree by the outcome of the cam-
should play a limited role in the decision on whether workers paign, so it should have a right to participate; (2) allowing
are better off unionizing. In his view, employees are deciding employers to campaign against unionization contributes to a
who should represent them in their dealing with the employer, more informed electorate, since the union will only give “one
and although the employer has an interest in the outcome, it side of the story”; and (3) freedom of expression is fundamental
is a decision that should be the employees’ alone: in Canada and should not be restricted except in exceptional
circumstances.‡
I have always found it incongruous that the em-
ployer should be given a central role in the represen-
* H.D. Woods, A.W.R. Carrothers, J. Crispo, & G. Dion, Canadian Industrial
tation play, even if its campaign is perfectly legal,
Relations, Report of the Task Force on Labour Relations (Ottawa, ON:
without a whisper of economic coercion of the em- Queen’s Printer, 1968) at 23.
ployees. … In making up their minds about union
† P. Weiler, Reconcilable Differences: New Directions in Canadian Labour Law
representation, the employees are really choosing
(Toronto, ON: Carswell, 1980) at 45-46. See also P. Alon-Shenker & G.
how they will deal with their employer, how they will Davidov, “Organizing: Should the Employer Have a Say?” (2016) 17 Theor
participate in settling and improving their terms of Inq L 63, online: <http://www7.tau.ac.il/ojs/index.php/til/article/
employment. The employer and the employees have viewFile/1373/1439>.
an inherent conflict of interest in that topic. Clearly ‡ See, for example, D. McPhillips, “Employer Free Speech and the Right to
the employer is affected by the employees’ judg- Trade Union Organization” (1982) 20 Osgoode Hall LJ 138. See also Canada,
ment about whether they will be represented by a Public Works and Government Services Canada, Canada Labour Code, Part
union. Yet surely that collective employee choice 1, Review: Seeking a Balance, Part 1 (Ottawa, ON: Human Resources
Development Canada, 1995) at 63-65 (it recommends a statutorily
should be as off limits to the employer as the em- protected freedom of employers to engage in non-coercive speech).

Section 70 of the Ontario Labour Relations Act (reproduced above) is typical of employer
expression provisions found in Canada. It provides that it is not an unfair labour practice for an
employer to “express the employer’s views” so long as the employer “does not use coercion,
intimidation, threats, promises or undue influence.”30 While all jurisdictions include similar
language, there is some variation across Canada in terms of how far an employer may go in its
efforts to persuade its employees to reject unionization.31 For example, the Manitoba Labour
Relations Act includes a freedom of expression provision similar to that of the Ontario legisla-
tion, but it also qualifies that an employer may communicate “to an employee a statement of fact
or an opinion reasonably held with respect to the employer’s business.”32 Together, these two
provisions have been interpreted to restrict employers from bad-mouthing unions with claims
such as “unions just want your dues” and “employees would be better off without a union.”33
However, in most Canadian jurisdictions, employers are permitted to actively lobby employees
to “vote no” and even to say negative things about unions, provided there are no threats, intimi-
dation, or coercion.34
Identifying where the divide lies between lawful expression and unlawful intimidation is not
always straightforward. As the OLRB noted in the case of Lorain Products (Canada) Ltd., “the
line which separates freedom of expression from undue influence or the other prohibitions
[coercion, intimidation, threats] of the Act is a thin one which must be drawn having regard to
the facts of the particular case.”35 Labour boards apply an objective test, asking whether an em-
ployee of “average intelligence and fortitude” would be intimidated by the employer’s expression
in the circumstances.36 In applying this test, labour boards consider the context in which the
speech is made, as well as the content or substance of the speech itself.37 For example, although
employer captive audience meetings are allowed, labour boards recognize that the act of forc-
ing non-union, vulnerable employees to listen to the employer’s anti-union message can itself
be coercive. Therefore, comments made at a captive audience meeting may be ruled to be coer-
cive and intimidating even though in another context the same comments may not be.38
Employers enter dangerous waters whenever they link a decision by employees to unionize
with negative job-related consequences.39 Thus, an employer that threatens to fire employees,
to close the workplace or transfer work, to cut wages or benefits, or to impose any other form
of disadvantage on employees if a union is successful is crossing the line into unlawful terri-
tory.40 Bribes, such as a promise to grant a raise or some other benefit if the employees reject
unionization, are similarly unlawful.41 Employers who hire spies or private investigators to
infiltrate union supporter groups and report back to the employer, or who use security guards
to closely watch union supporters or organizers, have been found to be engaged in unlawful
intimidation.42
However, even more subtle threats to job security can be unlawful. In a 2015 decision called
CS Wind Canada, the employer encouraged employees at a meeting to reject unionization and
pointed to a series of companies in the same community that had recently closed due to com-
petitive pressures while noting that unions can harm competitiveness. The labour board ruled
that a reasonable employee would understand that the employer was making a link between
unionization and the possible closure of the company.43 In the case considered in Box 32.4, the
employer was similarly careful to not make an explicit threat to employees who were consider-
ing unionization and yet was still found to have acted unlawfully. Pay attention to the reasoning
the labour relations board followed that led it to that conclusion.
captive audience meeting: A meeting that employees are ordered by their employer to attend to listen to the employer’s
opinions on whether employees should or should not support unionization.


An Employer’s Speech During an Organizing Campaign Crosses the Line
United Steelworkers of America v. Wal-Mart Canada, Inc. and then did not distance itself from the statement. Second,
1997 CanLII 15529 (Ont. LRB) Wal-Mart planted the seed in the minds of employees that
the store could close if the union won. It did this by constantly
Key Facts: In April 1996, the United Steelworkers of America soliciting questions from employees and then, when asked
(USWA) commenced an organizing campaign at a Wal-Mart about the possibility of a store closure, simply refusing to
Canada store in Windsor. Within a few weeks, the USWA had answer. This behaviour would cause “reasonable employees”
collected union membership cards on behalf of 91 employees to conclude a store closure in response to a union win is
out of just over 200 total employees in the bargaining unit possible:
sought. The USWA applied for certification on May 2. A certifi-
cation vote was held a week later, and the results were 151 the company’s failure to answer the questions of
votes against unionization and 43 votes in favour. The USWA associates with regard to the issue of a store closure
filed an unfair labour practice complaint alleging that in the would cause the average reasonable employee to
days preceding the vote, the employer had engaged in a cam- conclude that the store would close if the union got
paign of threats and intimidation of employees that tainted in. Given that the inside organizers told manage-
the outcome of the vote. The alleged employer conduct in- ment that this was in fact happening, and manage-
cluded the following: ment did not change its approach, we are satisfied
that the company intended employees to draw this
• telling an employee that a benefits program would be conclusion. There is no legal prohibition against an-
revoked by the employer if the union succeeded; swering questions with regard to store closure by
• inviting employees to ask any question about the saying that the company would not close and would
union campaign and promising to answer them, but sit down and negotiate with the union if the union
then refusing to answer the one question that con- was successful. Obviously, it is only illegal for the
cerned employees most: Would Wal-Mart close the company to say that the store would close. Therefore,
store if the union won? When employees asked that, by not alleviating employees’ concerns by answering
the employer answered that “it would be inappropriate” the question, the company was intentionally fueling
for the employer to comment on what might happen if employee concerns.
the union won;
• permitting an anti-union employee to give a speech Third, the employer’s strategy of having five managers
against the union at an employee meeting, but not circulate around the store for six days straight, repeatedly en-
granting a union supporter the same opportunity; and gaging employees in one-on-one discussions about the union,
• not distancing itself from the comment by the anti- surpassed simply providing information and crossed the line
union employee at the meeting that Wal-Mart “would into “undue influence.” The labour relations board ruled that
not stand for” a union. Wal-Mart’s unlawful conduct tainted the outcome of the vote:
Issue: Did Wal-Mart commit an unfair labour practice by its We have no doubt that the intentionally generated
pre-vote actions, and, if so, did those illegal acts taint the out- implied threat to job security which occurred in this
come of the vote? case had the result of rendering the representation
vote taken meaningless. This case is a classic ex-
Decision: Yes and yes. The OLRB noted that Wal-Mart’s re- ample of a situation in which the conduct of the
sponse to learning of the union campaign was sophisticated. employer changes the question in the minds of the
No one was fired, and there was no direct, overt threat to close employees at the vote from one of union repre
the store. However, Wal-Mart conveyed to employees the mes- sentation to one of “do you want to retain your
sage that there was a real possibility that if the union suc- employment.”
ceeded, it would consider closing the store. It did this in a
number of ways. Therefore, the board exercised its remedial power to certify
First, it permitted an employee to tell co-workers at a store the union (see the discussion of remedies, below), leading to
meeting that a vote for the union could threaten their jobs the first unionized Wal-Mart store in the world.
The prohibition on “undue influence” covers behaviour that might not otherwise be captured
by intimidation, coercion, and threats. Labour relations boards in jurisdictions that prohibit

“undue influence” (only British Columbia, Saskatchewan, and Quebec do not)44 have inter-
preted the prohibition to involve an unfair exploitation of employer power to pressure employ-
ees to accept the employer’s views, even if no explicit threat is used.45 For example, the OLRB
ruled in the Wal-Mart Canada case (see Box 32.4) that by having managers circulate for days
engaging employees in one-on-one conversations, the employer engaged in unlawful “undue
influence.”46 It was too much for employees to be confronted with constant one-on-one conver-
sations with their bosses.
V. Remedies for Unfair Labour Practices

Recall that the fundamental theory of remedies is to return the victim to the position they would
have been in but for the unlawful conduct of the guilty party.47 Collective bargaining statutes
grant labour boards broad discretion to design remedies. It is usually pretty straightforward to
decide how to compensate an employee who has been stripped of their job or benefits: give the
job and benefits back to the person, as happened in the decision examined in Box 32.1. Labour
boards routinely reinstate employees whose employment was terminated for union activity,
usually with full back pay and compensation for lost benefits. In some jurisdictions, including
Ontario, the labour board also has the power to order a fired employee to return to work on an
interim basis, until the person’s unfair labour practice complaint is decided (this is known as
interim reinstatement).48 An interim reinstatement can help offset the damage done to an or-
ganizing campaign by an unlawful termination of a union supporter.
A more challenging remedial question is how to return a union to the position it would have
been in but for an employer’s unlawful acts. What has a union lost when an employer engages
in unfair labour practices? Earlier in the chapter, we cited studies that conclude that when
employers act unlawfully during organizing campaigns, the odds of the union winning a certi-
fication application fall dramatically. Therefore, the harm to the union is the damage to its or-
ganizing campaign, and maybe the opportunity to win the campaign. Labour boards have been
creative in their efforts to try and provide a meaningful remedy to unions. For example, they
have, among other remedies, done the following:
• ordered employers to post and distribute notices to employees explaining how the em-
ployer broke the law and will not do so again;
• disregarded failed certification votes and ordered second votes, permitting the union to
decide the timing;
• ordered employers to provide the union with an office or other access to the workplace;
• ordered employers to allow the union to make speeches at work during working time or
use company bulletin boards;
• ordered employers to provide unions with personal contact information for employees;
• ordered that the union be permitted to show pro-union videos at the workplace;
• ordered that the employer reimburse the union for organizing costs.
However, these sorts of remedies do not always fully compensate the union for its lost oppor-
tunity to organize a workplace. If the unlawful acts by the employer are so serious that they
convince employees that supporting the union could cost them their jobs, then the union’s
chances of obtaining majority employee support may be irreparably damaged. After a serious
violation of the law by an employer, unions rarely win votes.49 Some governments (Ontario,
interim reinstatement: An order by a labour board (or other legal board possessing such authority) that the employer
reinstate a terminated employee to their job pending the outcome of litigation that will determine if the employer was within
its legal rights to terminate the employee.

Alberta, British Columbia, Manitoba, New Brunswick, Nova Scotia, and the federal jurisdic-
tion)50 have responded to this reality by empowering labour relations boards to issue remedial
certification. While some variation exists in the models used across jurisdictions, in essence
remedial certification laws permit a labour board to certify a union as the representative of
employees as a remedy for unfair labour practices when the board believes the employer’s con-
duct effectively destroyed the possibility of testing employee wishes through a ballot or card
check. This was the remedy ordered in the Wal-Mart Canada decision discussed in Box 32.4.
The remedial certification order grants the union a licence to try to bargain a first collective
agreement that employees will accept.

When Will Labour Boards Issue a “Remedial Certification” Order?
United Food and Commercial Workers Canada Union, union will need to establish its campaign has been
Local No. 401 v. Widewaters Calgary Hotel Management harmed in some manner resulting from the em-
Company ULC ployer’s unlawful conduct. Normally, evidence indi-
2018 CanLII 33689 (Alta. LRB) cating a stalled campaign or a failed vote will suffice
provided there is a causal relationship between it
Key Facts: Doncaster, an employee at a Hilton hotel in down- and the employer’s conduct. The consequences of
town Calgary, decided to organize a union. He contacted the the Employer’s conduct on the employees in ques-
UFCW, and an organizing campaign began on September 1, tion will continue to be assessed objectively, as is
2017. He was terminated on September 21 after the employer currently the case in British Columbia and Ontario.
learned of his role in organizing the union. The labour board
ordered Doncaster reinstated with full back pay, and the An “objective test” asks what is the likely effect of the em-
UFCW argued for a remedial certification order as well. The ployer’s conduct upon employees of average intelligence and
employer argued that remedial certification should not be fortitude. In this case, the board found that the termination of
ordered because the termination did not prevent the union Doncaster had “a chilling effect” on employee support for the
from organizing the workplace; the employer claimed that the organizing campaign, which was still in its early stages. After
campaign was already failing and was stalled before the ter- the termination, workers were “scared to talk about” the union.
mination. No union cards were signed after Doncaster was The board wrote: “The employer’s conduct changed the nar-
terminated. rative of the Union’s campaign for employees from one of
considering the mutual benefits and costs of joining a union
Issue: Should the labour board order remedial union certifica- to one of self-preservation.” The employees were not able to
tion in response to the termination of the union’s key inside freely exercise their right to join or not join the union because
organizer? the “decision had been made for them by the employer’s
conduct.”
Decision: Yes. The Alberta Labour Relations Board reviewed The board concluded that ordering another vote would not
how other Canadian labour boards had applied remedial cer- cure the harm done and that remedial certification was ap-
tification provisions and concluded the following: propriate to demonstrate that employees have a right to
unionize without fear of reprisals. In addition to ordering the
it is our view the remedial provisions in the Code re- union certified to represent the employees, the board also
quire the Board to look to the actual consequences ordered the employer to permit union representatives to enter
of the breach and to design a remedy or remedies, lunchrooms during working hours for one week to allow the
one of which can be a remedial certification, to best union to meet the employees and discuss union affairs during
undo the harm caused by the employer’s wrongful breaks.
actions. Where a remedial certification is sought, the
remedial certification: An order by a labour relations board certifying a union that may not have established that it has
majority employee support as a remedy for seriously unlawful acts by the employer—such as convincing employees that sup-
porting a union could cost them their jobs.

In the decision outlined in Box 32.5, the Alberta Labour Relations Board issued a remedial
certification order applying new powers introduced in 2017 by the provincial New Democratic
Party government.
Remedial certification, where it exists, is an exceptional remedy and is rarely ordered. It is
reserved for cases of serious employer misconduct involving threats to employees’ jobs or the
firing of union supporters that the board concludes cannot be wiped from the employees’ minds.
However, the mere threat of remedial certification may act as a strong deterrent to some employ-
ers who otherwise may perceive that benefit of breaking the law (avoiding a union certification)
to outweigh the cost of any remedial order that might otherwise be ordered (recall the discus-
sion of efficient breach in Chapter 2). Remedial certification is usually accompanied by addi-
tional remedies that aim to help the union rebuild a relationship of trust with the employees,
including access orders that allow union representatives onto employer property.51
VI. Chapter Summary

Unfair labour practice provisions modify the common law right of employers to discriminate
against employees who support unionization and collective bargaining. Unfair labour practice
provisions balance the rights of workers to organize with the right of employers to express opin-
ions about matters that will affect the business. Threats, coercion, and intimidation—both phys-
ical and economic—intended to influence employee opinions about unionization are prohibited.
Most of the time, unfair labour practices require an intention to undermine union organizing
or a finding that there was anti-union animus. However, Canadian collective bargaining statutes
also recognize non-motive unfair labour practices that require a balancing of the employer’s
legitimate business interests against the right to organize. In order to give meaning to the right
to organize, governments have conferred broad remedial powers on labour relations boards to
redress employers’ unfair labour practices.

1. In what way do unfair labour practice provisions affect the common law rights of
employers?
2. Explain the difference between a motive-based and a non-motive-based unfair labour
practice.
3. Should the law permit employers to campaign against unionization? What are the argu-
ments for and against a law that would require employers to remain neutral in relation to
an attempt by employees to unionize?
4. Write a speech that an employer could read to its employees that argues against unioniza-
tion but does not violate any unfair labour practice provisions in your jurisdiction.
5. What is remedial certification, and in what circumstances would it be ordered by a labour
relations board?
APPLYING THE LAW

1. Bill Wilson, the president of County Beer Company, discuss how to respond. They decide that they should
learns some employees have contacted the Beer Work- speak to the employees, and they order the workers to
ers Union and that the union is getting ready to file an attend a meeting in the cafeteria. Bill welcomes every-
application for certification. Bill calls Amanda, the hu- one, and then reads the following statement:
man resources manager, into his office, and the two
efficient breach: A deliberate violation of a contract or government statute owing to the belief that it is more economically
efficient to violate the legal rule than to comply with it.

I’ve called you here today because there is a rumour ommend that you do not support unionization. Please
circulating of a union organizing campaign. I want to feel free to talk to me if you have any questions.
explain some things to you. First, you do not need a Do you believe that Bill’s speech falls within the
union to represent you. This is a small, family-run busi- scope of lawful employer expression protected by col-
ness and we have always treated you like family here. lective bargaining legislation? Explain your response.
Unions are a business that is interested in collecting
more union dues. They cannot make this business 2. Bill learns that the employee who is leading the cam-
more successful, and a successful business is the only paign is Mark Anthony, a shipping and receiving em-
thing that can lead to better pay and benefits for all of ployee. Mark has been suspended in the past for poor
you. So don’t believe the union’s promises. work performance, and yesterday he punched in 15
We are in a very competitive industry, and we oper- minutes late without any reason given. Bill thinks that
ate with a small profit margin already. Any actions by the lateness combined with the earlier suspension
employees that disrupt production or cause produc- shows Mark’s performance has deteriorated. He de-
tion costs to rise could threaten the viability of the cides to dismiss Mark, but to avoid a wrongful dismiss-
business. Unions sometimes go on strike, and a strike al lawsuit, he provides Mark with the amount of notice
could seriously threaten the viability of this business, required by his employment contract. Is Mark’s termin-
since we may lose customers that we may not be able ation lawful?
to get back. It’s your choice whether to join the union
or not, and we respect your right to choose, but I rec-

1. Marv Jones Honda v. International Association of Machin- associations. However, note that PC 1003 treated unions
ists & Aerospace Workers District Lodge 250, 2015 CanLII and employee associations as distinct forms of employee
5787 (BCLRB). See also UFCW, Local 206 v. Swiss Chalet organizations.
Restaurant #1250, 2012 CanLII 74380 (Ont. LRB). 9. Canada Labour Code, RSC 1985, c. L-2, s. 96. See also BC
2. K. Bentham, “Employer Resistance to Union Certification: A Labour Relations Code, RSBC 1996, c. 244, s. 9; and
Study of Eight Canadian Jurisdictions” (2002) 57 Indus Rel Ontario Labour Relations Act, 1995, SO 1995, c. 1,
159 at 172. See also M. Campolieti, R. Gomez, & M. Sched. A, s. 70 [Ontario LRA].
Gunderson, “Managerial Hostility and Attitudes Towards 10. See the discussion in Flint Canada Inc., [1995] Alta. LRBR
Unions: A Canada – US Comparison” (2013) 34 J Lab Res 99. 48 at 58-59.
3. T. Thomason, “Managerial Opposition to Union Certifica- 11. There are dozens of Canadian cases in which employers
tion in Quebec and Ontario” (1998) 53 Indus Rel 750. have been found to have taken action against union sup-
4. C. Riddell, “Union Suppression and Certification Success” porters or threatened to take such action. See UFCW, Local
(2001) 34 Can J Econ 396. 206 v. Swiss Chalet Restaurant #1250, supra note 1; Conver-
5. Dunmore v. Ontario (Attorney General), 2001 SCC 94 at gys Customer Management Canada Inc. v. BCGSEU, 2003
para 20. See also Delisle v. Canada (Deputy Attorney CanLII 62911 (BCLRB) at para 38; Service Employees
General), [1999] 2 SCR 989 at para 32. See the discussion International Union Local 2, Brewery, General & Profes-
in D. Doorey, “Graduated Freedom of Association: Worker sional Workers’ Unions v. 3258205 Nova Scotia Ltd., 2014
Voice Beyond the Wagner Model” (2012) 38:2 Queen’s LJ NSLB 13; Common Ground Publishing Corp. v. Communi-
515 at 528-29 cations, Energy and Paperworkers Union of Canada, Local
2000, 2003 CanLII 63032 (BCLRB); White Spot Ltd.
6. Dunmore v. Ontario (Attorney General), supra note 5 at
(1993), 21 CLRBR (2d) 146 (BCLRB); Labourers’ Inter-
para 22, citing H. Arthurs et al., Labour Law and Industrial
national Union of North America, Local 1059 v. Carlos
Relations in Canada, 4th ed (Deventer, Netherlands:
Barbosa Concrete Limited, 2008 CanLII 26617 (Ont. LRB);
Kluwer, 1993) at 196.
International Association of Bridge, Structural, Ornamental
7. Today the provision is found in the Criminal Code, RSC and Reinforcing Ironworkers, Local 721 v. CS Wind Canada
1985, c. C-46, s. 425. Inc., 2015 CanLII 32521 (Ont. LRB); and UFCW Canada
8. To simplify, reference to “employee associations” includes Union, Local No. 401 v. Widewaters Calgary Hotel Manage-
both trade unions and other types of employee ment Company, ULC, 2018 CanLII 33689 (Alta. LRB).

12. See, for example, Ontario LRA, supra note 9, s. 96(5); 18. McGill’s Electrical Warehouse, [1997] Alta. LRBR 385; and
Manitoba Labour Relations Act, CCSM, c. L10, s. 9; BC UFCW, Local No. 401 v. Westfair Foods Ltd., 2008 CanLII
Labour Relations Code, supra note 9, s. 14(7); and Sas- 51092 (Alta. LRB).
katchewan Employment Act, SS 2013, c. S-15.1, ss. 6-32(5). 19. OSSTF District 25 v. Ottawa-Carleton District School
13. Pop Shoppe (Toronto) Limited, [1976] OLRB Rep. June 299: Board, 2001 CanLII 11073 (Ont. LRB); and The Millcroft
“In order for the Board to find that there has been no vio- Inn Limited, [2000] OLRB Rep. July/August 665.
lation of the Act it must be satisfied that the employer’s 20. See Communications, Energy and Paperworkers Union of
actions were not in any way motivated by anti-union senti- Canada v. Rapid Transformers Ltd., 1999 CanLII 20142 (Ont.
ment; the employer’s actions must be devoid of ‘anti-union LRB); and CUPE, Local 2424 v. Carleton University, 1998
animus.’” See also Barrie Examiner, [1975] OLRB Rep. Oct. CanLII 18245 (Ont. LRB). However, the employer can
745; The Corporation of the City of London, [1976] OLRB explain the state of the business or discuss facts with
Rep. Jan. 990; The Labour Relations Code v. UFCW Canada employees that are obvious: see Board, RWDSU v. 101109823
Union, Local No 401, 2014 CanLII 31405 (Alta. LRB); Saskatchewan Ltd., 2014 CanLII 64280 (Sask. LRB).
USWA v. Plaza Fiberglas Manufacturing Limited, 1990
21. Sandy Bay Ojibway First Nation, 2009 CIRB 440.
CanLII 5659 (Ont. LRB); Dylex Limited, [1977] OLRB Rep.
June 357; and CS Wind Canada Inc., supra note 11. 22. See Canadian Broadcasting Corp. v. Canada (Labour Rela-
tions Board), [1995] 1 SCR 157.
14. See Christian Labour Association of Canada, Construction
Workers Local 52 v. Covertite Eastern Limited, 1996 CanLII 23. Canadian Paperworkers Union v. International Wallcover-
11156 (Ont. LRB); and United Electrical, Radio and ings, 1983 CanLII 764 (Ont. LRB) at para 27.
Machine Workers of America v. Square D Canada Electric 24. Some statutes include an express provision clarifying that
Equipment Inc., 1980 CanLII 994 (Ont. LRB). However, in certain actions by an employer do not constitute an unfair
British Columbia, the labour relations board has permitted labour practice, such as making changes “reasonably ne-
employers to encourage employees to support one union cessary for the proper conduct of the business”: see BC
over another: see Simpe “Q” Care Inc. v. Hospital Employ- Labour Relations Code, supra note 9, s. 6(4).
ees’ Union, 2007 CanLII 29928 (BCLRB). 25. Carleton University, supra note 20 at para 50. See also
15. See, for example, BC Labour Relations Code, supra note 9, International Wallcoverings, supra note 23; UFCW Canada,
s. 31; and Ontario LRA, supra note 9, ss. 15 and 53. See Local 1288P v. Covered Bridge Potato Chip Company, 2016
also the discussion in Edwards v. Edwards (1952), 52 CLLC CanLII 20735 (NBLEB); and Ottawa-Carleton District
at para 17027; and Tilco Plastics Employee’s Association v. School Board, supra note 19.
Tilco Plastics (1976) Limited, 1980 CanLII 869 (Ont. LRB). 26. See International Wallcoverings, supra note 23 (an em-
16. In the United States, it is unlawful per se for an employer ployer rule banning union buttons and T-shirts violates
to provide any support to an employee association or to the non-interference provision); see also ETFO, Hamilton-
recognize and deal with a non-union employee association: Wentworth Local v. Hamilton-Wentworth District School
see National Labour Relations Act, 29 USC s. 158(a)(2). In Board, 2002 CanLII 26879 (Ont. LRB); and Southern
Canada, it is not unlawful for an employer to establish, aid, Ontario Newspaper Guild v. Metroland Printing, 1994
or recognize a non-union employee association, unless the CanLII 9946 (Ont. LRB).
employer is engaging in that conduct in order to thwart an 27. International Wallcoverings, supra note 23.
organizing campaign by a “real” union: see Tri-Canada
Inc., [1981] OLRB Rep. Oct. 1509. 28. USWA v. Adams Mine, Cliffs of Canada Ltd.,
1982 CanLII 978 (Ont. LRB). Some statutes make this
17. Delta Hospital, [1978] 1 CLRBR 356 (BCLRB) (it is not right explicit. See, for example, Ontario LRA, supra note 9,
unlawful for an employer to invite a union to organize its s. 77. However, if the employer permits employees to
employees); CUPE v. University of Toronto, 1988 CanLII socialize and speak about all subjects except unionization,
3691 (Ont. LRB) (on allowing a union to communicate then a prohibition on discussing unionization may amount
with employees); USWA v. Continuous Mining Systems to unlawful interference in the formation of a union: see
Limited, 1990 CanLII 5791 (Ont. LRB) (the employer pro- Canadian Imperial Bank of Commerce (1985), 85 CLLC
vided the union with a list of employees); National Auto- 16021 (CLRB).
mobile, Aerospace, Transportation and General Workers
Union of Canada v. Coca-Cola Bottling Co., 2004 CanLII 29. See, for example, Ontario LRA, supra note 9, s. 13; and
24945 (Ont. LRB) (the employer allowed the incumbent Cadillac Fairview Corporation Ltd. v. RWDSU, 1989
union to solicit at work but not the union attempting to CanLII 4334 (Ont. CA).
newly organize its workers); and 665846 B.C. Ltd. v. 30. Ontario LRA, supra note 9, s. 70. See also Alberta Labour
UFCW International Union, Local 1518, 2005 CanLII Relations Code, RSA 2000, c. L-1, s. 148(2)(c); Nova Scotia
17730 (BCLRB). Trade Union Act, RSNS 1989, c. 475, s. 58(2).

31. Employer speech rights were more restricted in the federal 39. UNITE HERE v. Novotel Canada Inc., 2012 CanLII 57428
jurisdiction and in Saskatchewan until recently: see, for (Ont. LRB); Wal-Mart Canada, supra note 36; CS Wind
example, Super Value (1981), 3 CLRBR 412 (Sask. LRB); Canada Inc., supra note 11.
and Bank of Montreal (1985), CLRBR (NS) 129. Both juris- 40. Peter Ross 2008 Ltd. v. United Steel, Paper and Forestry,
dictions recently introduced broader employer speech pro- Rubber, Manufacturing, Energy, Allied Industrial and
visions that aligned the approach with that in other Service Workers International Union, Local 2009, 2012
jurisdictions, essentially permitting non-threatening ex- CanLII 26996 (BCLRB); Hamlet of Kugaaruk, 2010 CIRB
pression: see Canadian Council of Teamsters v. FedEx 502; The Labour Relations Code v. UFCW Canada Union,
Ground Package System, Ltd., 2011 CIRB 614. Local No 401, supra note 13; and Allstar Mechanical Ltd. v.
32. Manitoba Labour Relations Act, supra note 12, s. 6(3)(f). United Association of Journeymen and Apprentices of the
33. See, for example, United Steelworkers, Local 9074 v. Win- Plumbing and Pipefitting Industry of the United States and
nipeg Dodge Chrysler Ltd., 2014 CanLII 36811 (Man. LRB). Canada, Local 170, 2001 CanLII 33129 (BCLRB).
34. Service Employees International Union, Local 1 Canada, 41. Canadian Fibre (2009), 167 CLRBR (2d) 261 (BCLRB);
Applicant v. PRP Senior Living Inc. o/a Sunrise of Aurora, and UFCW, Local 175 v. Pharmaphil, 1994 CanLII 9945
2013 CanLII 15847 (Ont. LRB); Teamsters Local 879 v. (Ont. LRB).
Greb Industries Limited, 1978 CanLII 630 (Ont. LRB); 42. Convergys Customer Management Canada Inc., supra note
UFCW, Local 2p6 v. Knob Hill Farms Limited, 1987 CanLII 11; and United Steelworkers of America v. Radio Shack,
3148 (Ont. LRB); Labourers’ International Union of North 1979 CanLII 817 (Ont. LRB).
America, Local 1059 v. West Elgin Construction Ltd., 2005 43. CS Wind Canada Inc., supra note 11
CanLII 19730 (Ont. LRB); Canadian Hotel and Service
44. In British Columbia, this omission has been interpreted to
Workers Union v. Romzap Ltd. (Sheraton Fallsview Hotel &
mean employers have broader rights to apply pressure on
Conference Centre), 1995 CanLII 10034 (Ont. LRB); Cardi-
employees to resist unionization or to select a union of the
nal Transportation B.C. Incorporated, BCLRB No. B344/96;
employer’s choosing, provided that overt threats or intimi-
and Convergys Customer Management Canada Inc., supra
dation are not used: see Convergys Customer Management
note 11. The federal jurisdiction used to more tightly
Canada Inc., supra note 11; and Simpe “Q” Care Inc., supra
restrict employer speech (see Bank of Montreal (1985),
note 14.
CLRBR (NS) 129), but after amendments to the Canada
Labour Code in 2001, the federal labour relations board 45. See, for example, K Mart Canada Ltd., [1981] OLRB Rep.
now permits non-coercive employer campaigning: see Jan. 60; Wal-Mart Canada, supra note 36; and PRP Senior
Canadian Council of Teamsters v. FedEx Ground Package Living Inc. o/a Sunrise of Aurora, supra note 34.
System, Ltd., supra note 31. 46. Wal-Mart Canada, supra note 36; see similarly PRP Senior
35. International Union of Electrical, Radio and Machine Living Inc. o/a Sunrise of Aurora, supra note 34.
Workers v. Lorain Products (Canada) Ltd., 1977 CanLII 47. For a review of labour relations board remedies, see J.
511 (Ont. LRB) at para 5. Andrew, Labour Relations Board Remedies in Canada, 2nd
36. Excell Agent Services (2003), 96 CLRBR (2d) 161 (BCLRB); ed (Aurora, ON: Canada Law Book).
USWA v. Wal-Mart Canada, 1997 CanLII 15529 (Ont. 48. Ontario LRA, s. 98.
LRB); 101109823 Saskatchewan Ltd., supra note 20; PRP 49. See Widewaters Calgary Hotel Management Company,
Senior Living Inc. o/a Sunrise of Aurora, supra note 34; and supra note 11 at para 10.
Saskatchewan Joint Board, RWDSU v. Sakundiak Equip-
ment, 2011 CanLII 72774 (Sask. LRB). 50. In Prince Edward Island, there is no express remedial cer-
tification, but the labour relations board has found that it
37. Excell Agent Services, supra note 36. has that power: see Polar Foods v. Prince Edward Island
38. See, for example, RMH Teleservices International Inc. v. (Labour Relations Board), 2002 PESCTD 56. For a discus-
BCGSEU, 2005 CanLII 24889 (BCLRB); Peter Ross 2008 sion of the test applied in British Columbia, see Cardinal
Ltd. v. United Steel, Paper and Forestry, Rubber, Manufac- Transportation B.C. Incorporated, BCLRB No. B344/96
turing, Energy, Allied Industrial and Service Workers Inter- (Reconsideration of BCLRB Nos. B463/94 and B232/95),
national Union, Local 2009, 2012 CanLII 12643 (BCLRB); 34 CLRBR (2d) 1.
Labourers’ International Union of North America, Local 625 51. Widewaters Calgary Hotel Management Company, supra
v. Alpine Construction (Windsor) Inc., 2011 CanLII 69421 note 11; PRP Senior Living Inc. o/a Sunrise of Aurora, supra
(Ont. LRB); and United Steelworkers, Local 9074 v. Winni- note 34; and Andrew, supra note 47 at 12:1500.
peg Dodge Chrysler Ltd., supra note 33. See also D. Doorey,
“The Medium and the ‘Anti-Union’ Message: Forced Lis-
tening and Captive Audience Meetings” (2007) 29 Comp
Lab L & Pol’y J 79.

C H A P T E R 33
Collective Bargaining and the

Making of a Collective Agreement
II. The Effects of Union Certification 541
• Describe the effects of union certification.
III. How Collective Bargaining Works 542
• Explain the process of collective bargaining and strategies used by IV. Types of Legal Rules Regulating Collective Bargaining 545
employers and unions. A. Statutory Freeze Provisions 545
• Describe the purpose and scope of the statutory freeze provisions in B. The Duty to Bargain in Good Faith and Make Reasonable
collective bargaining legislation. Efforts to Conclude a Collective Agreement 546
• Explain the scope and content of the “duty to bargain in good faith” and V. Broader-Based Collective Bargaining? 552
to “make reasonable efforts to conclude a collective agreement.” VI. Chapter Summary 554
I. Introduction
We have seen in preceding chapters that Canadian workers have struggled to access collective
bargaining for over a century. In the first half of the 20th century, these struggles occasionally
turned violent in the face of employer and government opposition. The Canadian collective
bargaining model began to emerge in the mid-1940s. This model borrowed key concepts from
the 1935 American Wagner Act—including majoritarianism, exclusivity, and union certifica-
tion. Once a union gained majority employee support within this model, it could obtain a
government-issued licence to bargain (a “certification”) on behalf of workers. After union cer-
tification, a novel legal obligation kicked in: both the union representing employees and the
employer were legally required to “bargain in good faith” with the objective of reaching a col-
lective agreement. This chapter examines the content of this duty to bargain.1
II. The Effects of Union Certification

The certification of a union marks a transition for employers and employees from the common
law regime to the collective bargaining regime. From this point onward, employers are no longer
permitted to negotiate terms and conditions of employment directly with employees. A new
actor, the union, has entered the scene, and our laws require the employer to recognize and
bargain with the union as the official, exclusive representative of employees in the bargaining
unit.2 Once a collective agreement comes into effect, all of the common law rules that are applic-
able to individual employment contracts (see Part II) fall by the wayside and are replaced by a
new law of collective agreements (see Chapters 35 – 36). The Supreme Court of Canada explained
this point in the case of McGavin Toastmaster Ltd. v. Ainscough:
541

The common law as it applies to individual employment contracts is no longer relevant to employer-
employee relations governed by a collective agreement which … deals with discharge, termination
of employment, severance pay and a host of other matters that have been negotiated between union
and company as the principal parties thereto.3
This fundamental shift in legal models marks a transformative moment for both the newly
unionized employer and the employees.
One of the most dramatic changes involves the rules regulating the negotiation of contracts.
In the common law (non-union) regime, both the employer and employee are free to walk away
from a negotiation if they dislike the terms being offered, just as you may walk out of a car deal-
ership if you don’t like the price of a car being offered by the salesperson. In the collective bar-
gaining regime, there is a legal obligation imposed on the employer and union to bargain with
each other, even if one of them would prefer to walk away or ignore the other party altogether.
The imposition on employers of a government-backed “duty to bargain” was a trade-off in the
Wagner model, necessary to persuade unions to agree to a model that channelled union recogni-
tion disputes into a tightly controlled legal regime. The Wagner model, introduced to Canada in
Order in Council PC 1003 (1944) (see Chapter 29) put an end to recognition strikes by offering
unions a means to force employers to the bargaining table. The duty to bargain was central to
this statutory scheme.
Canadian governments developed a legal model that was intended to provide a procedural
framework through which collective bargaining between unions and employers would produce
collective agreements—without work stoppages. Nowadays, the vast majority of collective bar-
gaining (about 95 percent) results in a collective agreement without a work stoppage. Many
people are surprised by this statistic, because the media tend to report on collective bargaining
only when there is a work stoppage, which can lead to a skewed and mistaken perception that
work stoppages in unionized workplaces are common.
III. How Collective Bargaining Works

Canadian collective bargaining is described as being “decentralized,” because most bargaining
takes place at the level of individual workplaces. Typically, a union is certified to represent
employees at a particular location (factory, store, etc.) of a single employer, and the union and
employer then bargain a collective agreement that is applicable only to employees who work at
that location. This “single employer – single union – single location” bargaining structure is by
far the most common collective bargaining structure in Canada, but other structures exist.4 For
example, the United Food and Commercial Workers union bargains a single collective agree-
ment with Loblaw that covers multiple unionized stores in a province (single union – single
employer – multiple locations). In the construction industry, in some provinces, a union repre-
senting a specific trade (e.g., carpenters or bricklayers) may bargain a single collective agree-
ment with multiple employers covering the entire province (single union – multiple
employers – multiple locations). In the public sector, it is common for a union to bargain a col-
lective agreement that covers categories of workers (e.g., administrative services or outside
workers) who work in a variety of locations.
The collective bargaining process is initiated when one party sends the other a notice to
bargain. A notice to bargain is a letter that says, essentially, “we would like to begin collective
recognition strike: A strike by workers with the aim of pressuring an employer to recognize and bargain with a union on
behalf of the employees.
bargaining structure: A term used to describe the identity and number of parties involved in collective bargaining, and the
scope of employees covered by that bargaining.
notice to bargain: A letter from a union or employer to the other party that formally begins the process of collective bargaining.

Chapter 33 Collective Bargaining and the Making of a Collective Agreement 543
bargaining.” Collective bargaining statutes regulate when a notice to bargain can be sent. In the
case of the renewal of an expiring collective agreement, that period varies from two to four
months before the end of the expiring agreement. Both the union and the employer select a
chief negotiator who does the talking on behalf of the party in bargaining. The employer may
hire a lawyer or appoint a manager, such as the human resources or labour relations manager,
to be their negotiator. Unions are less likely to retain lawyers to do their bargaining, although
lawyers may provide advice on contract language. Typically, a professional negotiator employed
by the union (known as a business representative or staff representative) acts as the union’s
chief negotiator. However, in larger bargaining units, workers may select their own bargaining
committee and chief negotiator from among their own ranks. For example, the local union
president or an elected chair of the union’s bargaining committee may assume the task.
Often the union presents its proposals first. However, doing so is not a rule nor is it always
the case. It is common practice for the parties to agree on a bargaining protocol. For example, a
bargaining protocol may provide that monetary issues (wages, benefits, pensions) will be left
until after the non-monetary issues have been resolved. The protocol might also explain
whether the parties will sign off on collective agreement clauses one by one as they are agreed,
or whether every clause remains negotiable until agreement is reached on the entire contract. In
Ontario and Manitoba, the law requires that collective agreements be ratified by a majority of
bargaining unit employees before they become legal.5 Therefore, the parties know that any
agreement reached by the negotiating teams is a “tentative” deal only and subject to employee
ratification. In other jurisdictions, it is common for the parties to agree at the outset whether
agreements are subject to approval by employees or, in the case of the employer, senior execu-
tives or a corporate board of directors.
We can think of collective bargaining as having three basic stages:
1. Pre-negotiation stage.
2. Negotiation stage.
3. Settlement stage.
In terms of bargaining strategy, both parties will come to the bargaining table with a list of items
they hope to obtain through negotiations. Those items are identified and compiled during a pre-
negotiation stage of collective bargaining. Unions often compile their bargaining “wish list” by
taking a survey of the employees in the bargaining unit, asking them to identify those issues that
they most want the union to try to win in negotiations.6 It is important in collective bargaining
for the parties to leave room to make bargaining concessions. Therefore, negotiating teams for
both parties typically identify their “opening positions,” their “preferred outcomes,” and their
chief negotiator: The lead spokesperson representing a party in negotiations.

business representative or staff representative: An employee of a union whose job is to negotiate and administer col-
lective agreements.
local union president: A person who leads a subunit of a union, known as a local union. A local union may represent a single
workplace or a group of workplaces within a defined geographical area or sector. Local union presidents are usually elected by
union members and are (or were) employees of a unionized employer.
monetary issues: Subjects in collective bargaining that impose direct costs on employers, such as wages, benefits, and pensions.
non-monetary issues: Subjects in collective bargaining that relate to contract language, such as the text of a grievance pro-
cedure or management rights clause.
ratification (of a collective agreement): A vote by unionized employees in favour of accepting a proposed collective
agreement.
bargaining concessions: When a party agrees to accept less in negotiations than they initially proposed.

“bottom line” positions. The bottom line position is that point beyond which the party will not
move and would accept industrial conflict (strike or lockout) on interest arbitration rather than
concede more at the bargaining table.
During the negotiation stage, the parties will have meetings and attempt to identify and reach
agreement on some matters, and they will search for a “zone of agreement” on more contentious
issues.7 For example, an employer may be prepared, if pushed, to give a 2.5 percent pay raise
(employer’s bottom line), but may hope to bargain only a 1.5 percent raise (employer’s preferred
outcome). In that case, the employer’s opening position may be a 0 percent raise, and it will
argue that it cannot afford a raise. The union may be prepared to accept a 2 percent raise (union’s
bottom line), but may hope for at least a 2.5 percent raise (union’s preferred outcome). The
union’s opening position may be a 4 percent raise. This scenario is illustrated in Figure 33.1. It
shows a potential “zone of agreement” on the issue of wages between 2 and 2.5 percent. That is
the range of pay raise that both parties are ultimately prepared to accept.
FIGURE 33.1 The Potential Zone of Agreement in Collective Bargaining
Employer’s Employer’s Employer’s

opening position preferred outcome bottom line
0% 1.5% 2.0% 2.5% 4%
ZONE OF AGREEMENT
Union’s Union’s Union’s

bottom line preferred outcome opening position
Source: Adapted from R. Walton & R McKersie, A Behavioral Theory of Labor Negotiations: An Analysis of a Social Interaction System (New York: McGraw-Hill, 1965).
The fact that a zone of agreement exists does not guarantee a settlement. In real collective
bargaining, a lot of issues are negotiated at once. An agreement on wages may not happen if
negotiation is held up on other issues. Personalities and agendas can impede settlement. More-
over, as we discussed in Chapter 2, collective bargaining outcomes are heavily influenced by
the relative power of the parties.8 Power is influenced by a large number of factors that act upon
the collective bargaining parties at any given time. A union’s primary source of power in col-
lective bargaining is the threat of a work stoppage, but the extent of that threat is affected by a
range of forces emanating from within the collective bargaining regime and from outside that
regime (external inputs). For example, the level of employee support for a strike; the size of the
bargaining unit relative to the employer’s total workforce; the ability of the employer to operate
during a work stoppage; union density in the employer’s industry; the state of labour markets
and unemployment levels; the level of product competition in the employer’s industry; public
opinion; and of course the laws that regulate collective bargaining and industrial conflict can
all affect relative bargaining power. The negotiation stage may reach an impasse that is resolved
interest arbitration: An arbitration process in which a neutral arbitrator (or arbitration board) imposes a final collective agree-
ment after the parties were unable to reach an agreement in negotiations.

only through one or both parties resorting to industrial conflict of the types described in Chap-
ter 34.
The final stage is the settlement stage, which requires the bargaining committees to write up
the agreed-upon collective agreement terms and often to take them back to be approved (or
“ratified”) by employees or other stakeholders (see discussion below). If an agreement is subject
to approval, and that approval is not forthcoming, the bargaining teams may be required to
return to the negotiation stage to try again.
IV. Types of Legal Rules Regulating Collective Bargaining

Three types of legal rules govern the collective bargaining process in Canada (see Figure 33.2).
First, statutory freeze provisions “freeze” the terms and conditions of employment during the
collective bargaining process. Second, the law imposes on the parties in collective bargaining
a “duty to bargain in good faith” and to “make reasonable efforts to conclude a collective agree-
ment,” as we will explore below. Third, extensive rules regulate what happens when negotiations
reach an impasse, as well as strikes and lockouts. We will explore the rules of industrial conflict
in Chapter 34.
FIGURE 33.2 Types of Legal Rules Regulating Collective Bargaining
Statutory freeze provisions Duty to bargain Industrial conflict law

The employer cannot The duty to bargain Rules regulating
change terms of in good faith and make an impasse,
employment reasonable efforts to conclude strikes, and lockouts
without union consent. a collective agreement (see Chapter 34)
A. Statutory Freeze Provisions

The statutory freeze provisions are intended to “maintain the prior pattern of the employment
relationship in its entirety.”9 During a statutory freeze period, the employer is prohibited from
altering terms and conditions of employment of bargaining unit employees without the union’s
consent, unless the alteration is consistent with past practice. The legal test is usually referred to
as “business as before.” Therefore, if an employer has always given employees a holiday bonus or
a raise at a specific time, then it could not refuse the bonus or raise because the statutory freeze
is in effect. However, if the employer has not given a holiday bonus in the past, then the em-
ployer could not do so if a freeze is in effect.10
There are two types of statutory freeze: (1) the certification freeze and (2) the collective
bargaining freeze. The two freezes kick in at different times and serve different policy purposes.
The details of when the two freezes end vary slightly across jurisdictions. Figure 33.3 depicts
how the statutory freeze provisions work in Ontario (see s. 86 of the Ontario Labour Relations
Act, 1995).
certification freeze: A rule found in collective bargaining legislation that prohibits an employer from altering terms of employ-
ment without the union’s consent during the processing of an application for certification.
collective bargaining freeze: A rule found in collective bargaining legislation that prohibits an employer from altering terms
of employment without the union’s consent during the period of collective bargaining.

FIGURE 33.3 The Statutory Freeze Process in Ontario
Date of application Date certification dismissed Date of legal

for certification or notice to bargain served strike/lockout
Certification freeze Collective bargaining freeze
The certification freeze applies from the moment the union serves the application for certi-
fication on the employer. It lasts until either (1) the labour relations board dismisses the union’s
application because the union’s organizing attempt failed, or (2) the union wins certification and
then serves the employer with a “notice to bargain.” That notice triggers both the end of the
certification freeze and the beginning of the collective bargaining freeze. In this way, the two
freezes blend into each other to create an extended period during which employers must not
alter terms of employment without the union’s consent that runs from the date of application for
certification until the date that the parties are in a legal strike or lockout position (or in some
jurisdictions, the date of an actual strike or lockout).11
The purpose of the certification freeze is to restrict any advantage the employer might have
to start playing around with working conditions to influence employees’ decisions about
whether to support or reject unionization. The purpose of the collective bargaining freeze is
slightly different. It is to prevent the employer from using its authority to change working condi-
tions during negotiations and thereby undermine the union’s authority to bargain, thus poison-
ing the bargaining climate.12 The certification freeze applies only during the initial certification
process, but the collective bargaining freeze applies during each new round of collective bar-
gaining, for as long as the union represents the workers. It is triggered each time either the em-
ployer or the union tells the other party it would like to begin bargaining toward a new collective
agreement—each time a new notice to bargain is served.
B. The Duty to Bargain in Good Faith and Make Reasonable Efforts to

Conclude a Collective Agreement
How does the law force parties and people to bargain when they have no desire to do so? Take
a look at section 17 of the Ontario Labour Relations Act, 1995, which essentially mirrors other
duty to bargain provisions in Canada:
The parties shall meet within 15 days from the giving of the notice or within such further period
as the parties agree upon and they shall bargain in good faith and make every reasonable effort to
make a collective agreement.13
Forty words. And most of those words are about when the first meeting takes place. The core of
the legal obligation to bargain in Canada is found in the final 14 words requiring the parties to
“bargain in good faith” and “make every reasonable effort to make a collective agreement.”14
What meaning to give to those words has been left to labour relations boards and to the courts
reviewing the decisions of those boards. Therefore, in order to understand the substance of the

duty to bargain in Canadian collective bargaining law, we need to know how those words have
been interpreted. The Supreme Court of Canada has provided some guidance. In the case of
Royal Oak Mines Inc. v. Canada (Labour Relations Board), the Supreme Court of Canada
explained that the duty to bargain contains both a “subjective” and an “objective” component:
Not only must the parties bargain in good faith, but they must also make every reasonable effort to
enter into a collective agreement. Both components are equally important, and a party will be found
in breach of the section if it does not comply with both of them. There may well be exceptions but as
a general rule the duty to enter into bargaining in good faith must be measured on a subjective standard,
while the making of a reasonable effort to bargain should be measured by an objective standard which
can be ascertained by a board looking to comparable standards and practices within the particular
industry. It is this latter part of the duty which prevents a party from hiding behind an assertion that
it is sincerely trying to reach an agreement when, viewed objectively, it can be seen that its proposals
are so far from the accepted norms of the industry that they must be unreasonable.15 [Emphasis
added]
The subjective standard requires labour boards to assess the party’s motive—is the party mak-
ing an honest attempt to reach a collective agreement? The objective standard compares the
party’s behaviour to that of others in the industry. If a party’s behaviour substantially veers from
the industry norm in a way that impedes the conclusion of a collective agreement, then a labour
relations board may determine that the party is not making reasonable efforts to conclude a
collective agreement.16
We can separate the legal rules that comprise the duty to bargain in good faith into rules that
apply to the process of collective bargaining (how collective bargaining takes place) and rules
that regulate the substance of collective bargaining (what is proposed during collective
bargaining).
1. The Procedural Duty to Bargain: The How of Collective Bargaining

The duty to bargain is primarily concerned with the process of collective bargaining, and labour
relations boards have developed rules intended to encourage the parties to engage in a rational
and informed discussion about each other’s proposals.
a. The Duty to Meet and Be Prepared to Negotiate

We can think of this first requirement as the “don’t waste the other party’s time” rule. The mis-
sion of the duty to bargain is to force the parties to come together and engage in a rational,
professional discussion about each other’s bargaining proposals.17 With this mission in mind,
labour relations boards have imposed a basic requirement on the parties to make themselves
available to meet within a reasonable time period. If one party continuously stalls by saying their
negotiators are on vacation or too busy with other matters, then they are not “making reasonable
efforts to conclude a collective agreement.” The parties must also send a person to the bargaining
table who is prepared and able to negotiate on behalf of the party. It is a waste of time, and
unlawful, for a party to send a junior employee with no authority to the bargaining table merely
to sit there and take notes on the other party’s submission.
b. The Duty to Provide Information and Respect the Union’s Role as the
Employees’ Exclusive Representative
An employer must provide the union with the information it requires to perform its job as the
legal bargaining representative of the employees. In the case of a newly certified union, this
includes the names, contact information, and terms and conditions of employment of the bar-
gaining unit employees. A failure to provide this information is a violation of the duty to bargain
(and perhaps also the prohibition discussed in Chapter 32 on employer interference with the

administration of a union).18 An employer must also not attempt to undermine the union in the
minds of employees by, for example, communicating directly with employees about bargaining
proposals that have not been discussed first with the union or in a manner that misrepresents
the union’s bargaining position or that paints the union in a negative light.19
c. The Duty to Be Honest and to Disclose Plans That Will Affect Bargaining
Unit Employees
The duty to bargain requires honesty. Lying to the other party is a violation of the duty to bargain.
Therefore, if a party is asked a direct question during negotiations, that party must answer truth-
fully.20 An interesting and related issue is whether the duty to bargain requires a party to disclose
information that would be of interest to the other party even if it has not been asked directly
about that information. Does the duty to bargain require “unsolicited disclosure” of relevant in-
formation? For example, imagine an employer is considering closing the workplace and firing the
workers, but it has not made a final decision yet. Is the employer under an obligation to give the
union this information, even if the union does not ask about a possible closure?
It is easy to see why a union would want to know about a possible closure. If the employees are
likely to be fired during the term of the collective agreement, then the union’s bargaining strategy
will change. There would be no point trying to bargain a raise or a new dental plan, for example,
if no one will have a job two years later. The union would focus entirely on trying to stop the
closure, bargaining higher severance packages or a right to vacant jobs at other locations of the
employer if they exist. The employer may not want the union to know its plans, to avoid having
to negotiate closure-related issues. Or, the employer’s plans may be only hypothetical during
negotiations; the closure may never happen. Therefore, the employer may wish to avoid bogging
down the negotiations with a hypothetical scenario. Labour relations boards have wrestled with
the issue of how much, and when, an employer is obligated to disclose information to the union
about its future plans. Box 33.1 describes a leading decision that explores this issue.21

The Duty to Disclose Information in Collective Bargaining
International Woodworkers of America Local 2-69 v. Issue: Did the employer violate the duty to bargain in good
Consolidated Bathurst Packaging Ltd. faith by failing to disclose its intention to close the Hamilton
1983 CanLII 970 (Ont. LRB) plant to the union during collective bargaining?
Key Facts: The International Woodworkers of America and Decision: Yes. The labour relations board summarized the
Consolidated Bathurst Packaging concluded a renewal collec- employer’s legal duty to disclose as follows. First, an employer
tive agreement in early 1983 covering employees working at must answer union questions truthfully. Second, an employer
the employer’s Hamilton location. In negotiations, the union must disclose on its own initiative decisions that have already
proposed language that would give employees greater bene- been made and that “will have a significant impact on terms
fits in the case of a plant closure, but eventually dropped that of employment,” such as a discontinuance of the workplace.
proposal. The employer never mentioned that it was consider- The timing of the announcement on the closure of the plant
ing or expecting to close the plant. However, soon after the was an important factor. The board concluded:
agreement came into effect, the employer announced that it
would be closing the Hamilton plant in April 1983. The em- where a decision to close is announced “on the
ployer claimed that a decision to close the plant was not made heels” of the signing of a collective agreement, the
until after the agreement had been concluded. The union filed timing of such a significant event may raise a rebut-
a bad-faith bargaining complaint, arguing that the employer table presumption that the decision-making was
had decided during the negotiation period to close the plant sufficiently ripe during bargaining to have re-
and had failed to disclose that information to the union. quired disclosure or that it was intentionally delayed
until the completion of bargaining. It can be persua-

sively argued that the more fundamental the deci- Here, the board found that the employer had not presented
sion on the workplace, the less likely this Board evidence sufficient to “rebut” the presumption that the deci-
should be willing to accept fine distinctions in tim- sion to close the Hamilton plant had ripened during the ne-
ing between “proposals” and “decisions” at face value gotiations, and therefore the employer was under a legal duty
and particularly when strong confirmatory evidence to disclose to the union that it was at least contemplating the
that the decision-making was not manipulated is closure. In terms of remedy, the board declined to order the
lacking. This approach is sensitive to the positive employer to reopen the plant because the employer had al-
incentive not to disclose now built into our system, ready sold the equipment and instead ordered that monetary
and the potential for manipulation. Indeed, a strong damages be paid to the union and employees calculated
argument can be made that the de facto decision based on an assessment of the additional severance amounts
doctrine should be expanded to include “highly the union would likely have bargained had it been aware dur-
probable decisions” or “effective recommendations” ing negotiations that the factory was closing.*
when so fundamental an issue as a plant closing is
at stake. Having regard to the facts in each case the * The decision of the Ontario Labour Relations Board on the remedy is
failure to disclose such matters may also be tanta- found at International Woodworkers of America Local 2-69 v. Consolidated
Bathurst Packaging Ltd., 1984 CanLII 929 (Ont. LRB).
mount to a misrepresentation.
2. The Duty to Bargain and the Substance of Bargaining Proposals: The What of
Collective Bargaining
Generally speaking, the parties in collective bargaining are left alone to bargain about whatever
they like.22 However, there are exceptions to this “hands off ” approach. Sometimes the content
of a bargaining proposal put to the other party can run afoul of the duty to bargain in good faith
and make reasonable efforts to conclude a collective agreement.
a. Bargaining Illegal Terms

Neither party can propose an illegal term, such as one that would violate human rights, occupa-
tional health and safety, or employment standards legislation.23 Collective bargaining legislation
in Canada also requires that some terms be included in every collective agreement (see
Chapter 35), and it is a violation of the duty to bargain for a party to refuse to include such terms.
For example, every jurisdiction in Canada requires that collective agreements include a provi-
sion providing that all disputes arising under the collective agreement be resolved by final and
binding arbitration without a work stoppage (mandatory arbitration clause), a requirement
that dates back to the 1940s. If a union or employer refuses to agree to a mandatory arbitration
clause, then it would be engaging in bad-faith bargaining.
b. Terms That Can Be Proposed, but Not “Bargained to Impasse”

Some types of collective agreement terms may be proposed and discussed in negotiations, but
cannot be “bargained to impasse.” This means that parties who are unable to agree on a par-
ticular term must drop the term from their proposals and cannot use the term as the basis for a
strike or lockout. It is up to the labour relations board to determine whether a proposed term
has in fact been “bargained to impasse.” Bargaining to impasse occurs when the proposed
term in dispute holds up a settlement.24 As an example, changes to the scope of a bargaining unit
(the definition of the group of employees covered by a collective agreement) can be proposed,
but not bargained to an impasse.25 A union may propose to expand a bargaining unit to include
more jobs than it was originally certified to represent, or an employer may attempt to bargain a
smaller bargaining unit. However, if agreement is not reached on the proposed change, neither
side can provoke a strike or lockout over the issue. The status quo must prevail.
mandatory arbitration clause: A clause in a collective agreement that requires all disputes arising under the collective
agreement to be referred to binding labour arbitration to be resolved.

c. Hard Bargaining Versus Surface Bargaining

A key distinction in collective bargaining law is between lawful hard bargaining and unlawful
surface bargaining. A party engages in “hard bargaining” when it uses its superior bargaining
power to insist on a collective agreement that is favourable to its own interests.26 Hard bargain-
ing is not a violation of the duty to bargain, because the legal model anticipates that collective
bargaining is shaped by underlying power relations. The Ontario Labour Relations Board
(OLRB) summarized this point: “For whatever else it is, collective bargaining is … a contest of
economic power (perhaps only partially masked by polite manners and voluminous statis-
tics).”27 Collective bargaining legislation grants the parties a means to pressure the other side to
offer more favourable terms, including strikes and lockouts (Chapter 34). The duty to bargain is
not intended to aid the weaker party by guaranteeing bargaining outcomes more favourable
than that party could obtain on its own.28
“Surface bargaining,” on the other hand, is a violation of the duty to bargain in good faith.
Surface bargaining occurs when a party goes through the motions of collective bargaining with-
out any intention of ever reaching a collective agreement.29 For example, the party agrees to
meet the other party and to engage in a cursory discussion of proposals, but the real plan is to
avoid the union and a collective agreement.
Distinguishing between hard bargaining and surface bargaining is difficult. In many cases,
where labour boards have found that the employer engaged in unlawful surface bargaining,
there was also a history of employer unfair labour practices, particularly during the organizing
campaign. The earlier unfair labour practices can taint the employer’s later behaviour in collec-
tive bargaining and lead the labour relations board to conclude that the employer has no inten-
tion of reaching an agreement with the union.30
A proposal that includes contract clauses that the proposing party knows the other side will
never accept or the refusal to accept clauses that are standard throughout the industry can
sometimes lead a labour board to conclude that a party has no intention to conclude a collective
agreement.31 That was the scenario in the decision described in Box 33.2.

Proposing Untenable Contract Terms
Royal Oak Mines Inc. v. Canada (Labour Relations Board) agree to a grievance or arbitration process that would permit
[1996] 1 SCR 369 the employees who were fired during the strike to challenge
their dismissal. The union filed a bad-faith bargaining com-
Key Facts: For 18 months, a bitter strike took place at Royal plaint. The Canada Labour Relations Board ruled that the em-
Oak Mines’s Giant Mine in Yellowknife. The employer used ployer had bargained in bad faith. That decision was reviewed
replacement workers and hired a security company to deal up to the Supreme Court of Canada.
with violence on the picket line. During the strike, the em-
ployer terminated the employment of 49 strikers for alleged Issue: Did the employer violate the duty to bargain in good
picket line misconduct. Four months into the strike, an explo- faith and to make reasonable efforts to conclude a collective
sion at the mine killed nine miners. Following this event, the agreement by refusing to agree to a grievance and arbitration
government assigned senior mediators to help the parties process for fired workers?
settle their dispute. However, the mediators were unable to
produce an agreement. The main stumbling block was the Decision: Yes. The employer was engaged in unlawful surface
employer’s insistence that under no circumstances would it bargaining. The requirement to make a “reasonable effort to
hard bargaining: A lawful strategy in collective bargaining that involves a party using its superior bargaining power to insist
upon collective agreement terms that favour its own interests.
surface bargaining: A strategy in collective bargaining that involves a party going through the motions of bargaining but hav-
ing no intention of ever concluding a collective agreement. Surface bargaining is a violation of the duty to bargain in good faith.

enter into a collective agreement” is an objective standard, labour board to find that the party is not making a
requiring the labour relations board to consider comparable “reasonable effort to enter into a collective agree-
standards and practices in the mining industry. A bargaining ment.” … For an employer to refuse an employee a
position can be “so far from the accepted norms of the industry grievance procedure or some form of due process,
that they must be unreasonable.” That was the case here. The by which the employee can challenge his or her
Supreme Court wrote: dismissal on the ground that it was not for just
cause, is to deny that employee a fundamental right.
If a party proposes a clause in a collective agree-
ment, or conversely, refuses even to discuss a basic Since no union would accept a collective agreement with-
or standard term, that is acceptable and included in out the arbitration clause, the refusal of the employer to ne-
other collective agreements in comparable indus- gotiate that clause indicated a lack of good faith.
tries throughout the country, it is appropriate for a
When a party has engaged in bad-faith bargaining, the usual remedy is to order the party to
go back and engage in bargaining and to send a statement to employees advising them of the
unlawful conduct.32 Labour boards can also order that damages be paid to the other party for
the wasted cost of negotiation or to employees if they suffered financial losses due to the bad-
faith bargaining (e.g., lost wages if the unlawful conduct extended the length of a strike or
lockout).33 In the Royal Oak Mines case, the labour board ordered the employer to re-table terms
that it had offered the union months earlier (which employees had rejected) that included a
grievance and arbitration provision applicable to the fired employees.
In Royal Oak Mines, the employer’s refusal to agree to an arbitration provision that applied
to employees terminated during the strike was found to constitute bad-faith bargaining. How-
ever, it is not always unlawful for an employer to use its superior bargaining power to insist on
collective agreement terms favourable to its interests. The decision summarized in Box 33.3
describes a famous example of lawful “hard bargaining.”

Lawful Hard Bargaining
Retail, Wholesale & Department Store Union v. T. Eaton than what it paid employees in the non-union stores. In Nov-
Company Limited ember 1984, the union struck at all six GTA stores. Eaton’s
1985 CanLII 933 (Ont. LRB) stayed opened during the strike, using non-striking personnel
to run the store. The RWDSU then filed a complaint alleging
Key Facts: Eaton’s was a large Canadian retailer that had oper- that the employer had bargained in bad faith.
ated mostly non-union for decades prior to an organizing blitz
by the Retail, Wholesale & Department Store Union (RWDSU) Issue: Did Eaton’s violate the duty to bargain in good faith by,
in the 1980s. That campaign resulted in RWDSU being certified among other actions, insisting on bargaining separate agree-
to represent employees at a handful of Eaton’s stores around ments for each of more than a dozen bargaining units and by
the Greater Toronto Area (GTA). In each of the stores, the OLRB refusing to offer a raise beyond what non-union workers
certified separate bargaining units for full-time and part-time receive?
employees, as was the practice in the 1980s. That meant that
there were over a dozen bargaining units certified to represent Decision: No. The OLRB explained that this was a case of
Eaton’s employees at six GTA stores. The union proposed that “hard bargaining” by Eaton’s. There was nothing improper in
the parties negotiate one “master collective agreement” that Eaton’s use of its bargaining power to insist on a collective
would apply to all the stores, but the employer insisted on bargaining process and collective agreement terms that bene-
conducting separate negotiations for each bargaining unit and fit the employer’s interests, provided that it was prepared to
on a process that involved extended discussions of each one meet and engage in extended discussions about the union’s
of the union’s proposals. This meant bargaining would drag on proposals and that it was prepared to sign a collective agree-
for months, since both employer and union were using the ment. The OLRB’s discussion of the issues provides a useful
same lead negotiators. The employer took the position that it summary of the duty to bargain in Canada:
would not agree to pay the unionized employees any more

[A] major function of the … duty [to bargain] is to

oblige the parties to enter into serious negotiations Nothing in the Labour Relations Act requires an em-
with the shared intent of entering into a collective ployer to agree to wages and employee benefits for
agreement. This requires that the parties explain unionized employees that are superior to those be-
their positions to the other side, so as to allow for ing received by non-unionized employees. … Nei-
rational, informed discussions. … An employer can- ther is there any provision which prohibits an
not enter into negotiations with the intent of ridding employer when formulating its bargaining position
itself of the trade union. Neither can it simply engage to take into account the likelihood that improve-
in “surface bargaining,” whereby it “goes through the ments in the terms of employment for one group of
motions” of bargaining without any real intent of employees will likely impact on other groups. In-
signing a collective agreement. … [The duty to bar- deed, logic suggests that this is a consideration fre-
gain] does not, however, require that an employer quently taken into account by employers, since an
agree to the terms of a collective agreement pro- improvement in the employment conditions of one
posed by a trade union. Neither does it prohibit an group of employees will logically lead to calls for
employer acting in its own self-interest from en- similar improvements from other employees of the
gaging in “hard bargaining” so as to obtain an agree- same employer, whether they be unorganized or
ment with terms favourable to it. … The fact that the included in a different bargaining unit.
company has not made any major concessions in
bargaining relates directly to the type of agreement Eaton’s did violate the duty to bargain in one respect. It had
management is seeking to negotiate. [The duty to insisted on a clause prohibiting workers from discussing union
bargain] does not … preclude a party from taking a matters on employer property, even during non-working time.
firm position in bargaining. That prohibition is unlawful interference with the right of
workers to engage in union activities, so insisting on it in
On the issue of the employer’s refusal to offer wages and bargaining violated the duty to bargain. The union’s other
benefits above what it gives non-union workers, the OLRB arguments were dismissed.
wrote:
V. Broader-Based Collective Bargaining?

The Eaton’s case is important for what it tells us about the difficulties unions have had in pene-
trating the service sector, including retail and banking.34 While unions are often able to obtain
majority support and to organize one or more stores of giant corporations, they have great dif-
ficulty bargaining strong collective agreements for those units. RWDSU represented approxi-
mately 1 percent of Eaton’s 30,000 employees, employed in only six stores. Eaton’s was not
prepared to give the unionized workers any benefit above what non-union employees receive for
the obvious reason that to do so would encourage other workers to join the union. Therefore,
the only way that the unionized workers could pressure Eaton’s to improve its offer was to strike.
They timed the strike for the Christmas shopping rush, hoping to inflict the greatest economic
damage. However, the strike had little effect. The stores remained open during the strike and, in
any event, the strike affected a small proportion of the company. Eaton’s was prepared and able
to withstand a strike at a few stores to ensure unionization did not spread. Unable to win notice-
able improvements, the workers decertified the union within a few years.35
This basic scenario has played out time and again throughout Canada in industries charac-
terized by large corporations that operate through many scattered stores or branches.36 The
difficultly for workers seeking collective bargaining in these workplaces is that the Wagner
model Canada adopted in the mid-1940s was never designed to facilitate collective bargaining
in industries that use this business structure.37 The Wagner model targeted large industrial
workplaces, factories, and mines, where hundreds of employees worked regular full-time hours
at the same location. The power dynamic (see Chapter 2) is very different when 1,000 General
Motors employees threaten to strike at a single factory compared with when a handful of
employees threaten to strike at a few Eaton’s, Walmart, Starbucks, or Scotiabank locations.

Occasionally, governments have sought to address this dynamic by adopting different models
of collective bargaining. For example, in Ontario in the 1990s and again briefly in 2018 until the
law was repealed in 2019, the labour board was empowered to “consolidate” multiple bargaining
units of the same employer if organized by the same union.38 That law would have given the
union in the Eaton’s case the ability to combine the various bargaining units and to thereafter
bargain its desired “master” collective agreement. Each new Eaton’s store organized by the union
would then have been swept into the combined bargaining unit, allowing the union to grow over
time. In both British Columbia and, more recently, Ontario, government-commissioned studies
considered the idea of broader-based bargaining structures that would enable a union to be
certified for sectors of the economy, such as “all employees in the fast-food industry,” in a par-
ticular city.39 Industry- or sector-level bargaining like this exists in various forms in some Euro-
pean countries, but would require a fundamental reordering of the Wagner model to take hold
in Canada and the United States.
The Ontario government summarized the arguments for broader-based collective bargaining
structures in their 2016 Changing Workplace Review: Special Advisors’ Interim Report:
Many commentators have criticized the current industrial relations model … It is said that the cur-
rent system, based on the 1940s United States Wagner Act model, is unable to respond to the modern
labour market, characterized by growing employment in small workplaces and non-standard work.
It is said that the Wagner Act model limits access to collective bargaining to many thousands of work-
ers because there is no practical way for collective bargaining to operate in much of the present
economy. This is seen to affect vulnerable workers in precarious work, especially in industries where
such workers feature prominently, such as in restaurants (particularly fast-food), accommodation,
retail, and other service industries. While this is generally seen as a private sector problem, it is said
to also to occur in the public sector (e.g., in home care).
“Broader-based bargaining” (also referred to as “sectoral bargaining”) is advocated as a necessary
alternative or addition to the old industrial relations model. …Generally, labour relations in Canada
are highly decentralized … [T]he default arrangement in our system is for collective bargaining to
take place between a union representing a group of employees at a particular workplace and their
employer, particularly in the private sector …
Unions assert that bargaining separate individual agreements with many small employers, or
separate agreements for each small location of a larger employer, is inefficient, uneconomic and
burdensome. The costs of organizing (including costs of legal proceedings) and representing small
units one-by-one are too high and effectively deter organization.
In the context of the Wagner Act model, workers have found it difficult to organize into unions
in sectors characterized by small workplaces (typically also associated with high rates of part-time,
temporary and contract jobs). The union coverage rate in the private sector is approximately 24%
among workplaces with more than 500 employees, but below 7% in workplaces with fewer than 20
employees.40
Ultimately, neither the Ontario nor the BC government moved forward with reforms to
introduce broader-based bargaining in the service or manufacturing sectors. While the argu-
ment for broader-based bargaining is gaining steam, to date it exists only sporadically in indus-
tries such as construction and the arts. However, expect ongoing debates in the years to come
about whether the Canadian collective bargaining model should be restructured to enable
broader-based bargaining in some format.
broader-based bargaining: A term used to describe collective bargaining structures that involve a broader scope than the
one union – one employer – single location structure that dominates Canadian collective bargaining.

VI. Chapter Summary

This chapter examined the process and law of collective bargaining in Canada. It demonstrated
that the manner of negotiation and the laws that govern the process are dramatically different
in the collective bargaining regime than in the non-union common law regime. Collective bar-
gaining law, through a duty to bargain in good faith and to make reasonable efforts to conclude
a collective agreement, plays a central role in the collective bargaining process. This law is con-
cerned mostly with limiting industrial conflict by encouraging rational and professional discus-
sions between representatives of unions and employers in the hope that collective agreements
can be reached without work stoppages. That usually happens. However, sometimes the parties
fail to reach a collective agreement. Therefore, a different set of rules is needed to deal with
bargaining impasses. Those rules are the subject of the next chapter.

1. What is the difference between monetary and non-monetary issues in collective bargain-
ing? For each type of issue, provide an example of a proposal that might be raised in col-
lective bargaining by either a union or an employer.
2. Describe the three basic stages of collective bargaining and what is involved at each stage.
3. Identify and explain the two “statutory freezes” found in Canadian collective bargaining
legislation. What are the policy reasons that explain the two freezes?
4. The duty to bargain includes both a “subjective” and an “objective” component. Explain the
meaning of each component.
5. Describe the scope of the “procedural duty to bargain.”
6. What is the difference between “hard bargaining” and “surface bargaining”?
APPLYING THE LAW: COLLECTIVE BARGAINING SIMULATION

Note to Instructors: Role-playing exercises and instructions have adopted this text for classroom use. Contact your Emond
for a collective bargaining simulation are available as part of representative for more information or visit this book’s website
the supplements package made available to instructors who at <https://www.emond.ca/LW2>
APPLYING THE LAW

1. The Brewery Workers Union was successful in is cam- 2. The parties begin negotiations. The union proposes a 4
paign to organize employees of the County Beer Com- percent wage increase, but the employer informs the
pany. The union sent a “notice to bargain” to the union that it cannot afford any raise. After several ne-
company, providing dates to meet and begin bargain- gotiation sessions, the employer refuses to budge. The
ing and also requesting a full list of employees in the employer tells the union that it is happy to keep nego-
bargaining unit, with their wage levels, benefits, home tiating and to talk about other issues, but says that the
addresses, and phone numbers. The employer provid- workers are already well paid and that a raise could
ed the wage and benefits information but refused to threaten the profitability of the company. The employ-
supply the union with the contact information. The ees become angry and encourage the union to file a
union filed a bad-faith bargaining proposal. Will it be bad-faith bargaining complaint. Do you think the com-
successful? plaint would be successful?

1. For an extensive review of the duty to bargain law in 11; and Labour Law Casebook Group, Labour and Employ-
Canada, see G. Adams, Canadian Labour Law, 2nd ed ment Law: Cases, Materials, and Commentary, 8th ed
(Aurora, ON: Canada Law Book, 1993) at chapters 10 and (Toronto, ON: Irwin Law, 2011) at chapter 6.

2. See, for example, Ontario Labour Relations Act, 1995, SO 18. Michelle Taschner v. UFCW Canada 175 & 633, 2018
1995, c. 1, Sched. A, s. 17 (duty to bargain in good faith), CanLII 11112 (Ont. LRB); Professional Institute of the
s. 73 (1) (unfair labour practice for unionized employer to Public Service of Canada v. Treasury Board and Canada
bargain directly with employee) [Ontario LRA]. Revenue Agency, 2008 PSLRB 13; OPSEU v. Alcohol and
3. McGavin Toastmaster Ltd. v. Ainscough, [1976] 1 Gaming Commission of Ontario, 2002 CanLII 40611 (Ont.
SCR 718. LRB); CAW-Canada v. The Millcroft Inn Ltd., 2000 CanLII
12207 (Ont. LRB); and USWA, Local 7292 v. Buhler Manu-
4. See the discussion in R. Chaykowski, “Collective Bargain-
facturing, 2007 CanLII 81861 (Man. LB).
ing: Structure, Process, and Innovation” in M. Gunderson
& D. Taras, eds, Canadian Labour and Employment Rela- 19. Operative Plasterers’ and Cement Masons’ International As-
tions, 6th ed (Toronto, ON: Pearson Education, 2009) at sociation, Local Union No. 172 v. A.N. Shaw Restoration
chapter 10. Ltd., 1978 CanLII 554 (Ont. LRB); British Columbia Auto-
mobile Association, BCLRB No. B498/99; Cypress (Regional
5. Ontario LRA, supra note 2, s. 44; and Manitoba Labour
Health Authority) v. Service Employees’ International
Relations Act, CCSM c. L10, s. 69.
Union-West, 2016 SKCA 161; and International Alliance of
6. There is an extensive industrial relations literature study- Theatrical Stage Employees, Moving Picture Technicians,
ing the conduct and processes of collective bargaining: R. Artists and Allied Crafts of the United States, Local 849 v.
Walton & R. McKersie, A Behavioural Theory of Labor Egg Films, Inc., 2015 NSLB 213.
Negotiations: An Analysis of a Social Interaction System
20. USWA, Local 4487 v. Inglis Limited, 1977 CanLII 490 (Ont.
(New York: McGraw-Hill, 1965). See also Chaykowski,
LRB); and International Woodworkers of America Local
supra note 4; F. McQuarrie, Industrial Relations in Canada
2-69 v. Consolidated Bathurst Packaging Ltd., 1983 CanLII
(Toronto, ON: Wiley, 2003) at 269; and J. Godard, Indus-
970 (Ont. LRB).
trial Relations, the Economy, and Society, 4th ed (Concord,
ON: Captus Press, 2011) at 301. 21. See also OPSEU v. Ontario (Management Board Secretar-
iat), 2005 CanLII 8247 (Ont. LRB); Canadian Federal
7. Walton & McKersie, supra note 6.
Pilots Association v. Treasury Board (Department of Trans-
8. See Chaykowski, supra note 4 at 260-64. port), 2014 PSLRB 64; CUPE, Local 1251 v. New Bruns-
9. Spar Professional and Allied Technical Employees’ Associa- wick, 2009 CanLII 74885 (NBLEB); and United Electrical,
tion v. Spar Aerospace Products Ltd., 1979 CanLII 870 Radio & Machine Workers of America v. Westinghouse
(Ont. LRB). See also D.H.L. International Express Limited, Canada Limited, 1980 CanLII 893 (Ont. LRB).
2001 CIRB 129. 22. Catholic Independent Schools Diocese of Prince George v.
10. CUPE, Local 3010 v. Children’s Aid Society of Cape Breton, BCGSEU, 2001 CanLII 32940 (BCLRB) at 26-27.
2009 NSLRB 11. 23. MacDonalds Consolidated Ltd., BCLRB No. 51/76, [1976]
11. For example, in Ontario, the bargaining freeze ends on the 2 CLRBR 292.
date a strike or lockout would be legal. See Ontario LRA, 24. Nanaimo Golf & Country Club v. Unite Here, Local 40,
supra note 2, s. 86 (1). In British Columbia, the bargaining 2015 CanLII 44718 (BCLRB).
freeze lasts until the parties actually engage in a strike or
25. Northwood Pulp and Timber Limited (1994), 23 CLRBR
lockout or the union is decertified: see BC Labour Rela-
(2d) 298 (BCLRB); United Brotherhood of Carpenters &
tions Code, RSBC 1996, c. 244, s. 45(2).
Joiners of America Employer Bargaining Agency v. United
12. Air Canada (1977), 24 di 203 (CLRB). See also D.H.L. Brotherhood of Carpenters & Joiners of America, 1978
International Express Limited, supra note 9. CanLII 434 (Ont. LRB); RWDSU v. T. Eaton Company
13. Ontario LRA, supra note 2, s. 17. Limited, 1985 CanLII 933 (Ont. LRB); Southam
14. Some provinces’ legislation does not include the part Inc., [2000] Alta. LRBR 177; Coca-Cola Bottling Ltd.
about making reasonable efforts to make a collective (1999), 52 CLRBR (2d) 203 (BCLRB); and Brantford
agreement, but the labour relations boards have neverthe- Expositor, [1988] OLRB Rep. July 653. See also V.I. Care
less interpreted the duty to bargain as including that Management (1993), 19 CLRBR (2d) 153 (employer
obligation. cannot bargain to impasse a clause that relates to the appli-
cation of a union’s constitution).
15. Royal Oak Mines Inc. v. Canada (Labour Relations Board),
[1996] 1 SCR 369. 26. See, for example, Canadian Union of United Brewery,
Flour, Cereal, Soft Drink & Distillery Workers, Local No.
16. Ibid. 304 v. Canada Trustco Mortgage, 1984 CanLII 1106 (Ont.
17. DeVilbiss (Canada) Ltd. (1976), 76 CLLC at para 16009; LRB); T. Eaton Company Limited, supra note 25; Egg Films,
Buhler Versatile Inc., [2001] MLBD 9 (MLRB); and Halifax Inc., supra note 19; Professional Institute of the Public
Regional Municipality v. Halifax Professional Firefighters, Service of Canada v. Treasury Board, 2009 PSLRB 102;
Local 268, 2011 NSLB 65. Canadian Federal Pilots Association v. Department of

Transport, Transportation Safety Board, and Treasury Unionization in the Chartered Banks of Canada” (1980)
Board Secretariat, 2018 FPSLREB 91; and Toronto Typo- 18:2 Osgoode Hall LJ 178.
graphical Union No. 91 v. Daily Times, 1978 CanLII 507 37. J. Fudge, “The Gendered Dimension of Labour Law:
(Ont. LRB). Why Women Need Inclusive Unionism and Broader-
27. USWA, Local 1005 v. Stelco Inc. (Hilton Works), 2000 Based Bargaining” in L. Brisken & P. McDermott, eds,
CanLII 11075 (Ont. LRB). Women Challenging Feminism, Democracy, and Militancy
28. Noranda Metal Industries, [1975] 1 Can. LRBR 145. (Toronto, ON: University of Toronto Press, 1993); and K.
Andrias, “The New Labor Law” (2016) 126 Yale LJ, online:
29. Daily Times, supra note 26. <https://www.yalelawjournal.org/article/
30. USWA v. Radio Shack, 1979 CanLII 817 (Ont. LRB). the-new-labor-law>.
31. Ibid.; and Royal Oak Mines, supra note 15. 38. The ability to consolidate bargaining units was found in
32. See Radio Shack, supra note 30 for a discussion of rem- s. 15.1 of the Ontario Labour Relations Act, 1995 between
edies in bad-faith bargaining cases. January 1, 2018, and May 7, 2018; see <http://canlii.
ca/t/532g5>.
33. Buhler Versatile, supra note 17.
39. Ontario Ministry of Labour, Changing Workplaces Review:
34. See D. Doorey, “Why Unions Can’t Organize Retail Special Advisors’ Interim Report (Toronto, ON: Queen’s
Workers,” online, Law of Work (blog): <http://lawofwork. Printer for Ontario, 2016) at part 4.6.1, online: <https://
ca/?p=7061>. www.labour.gov.on.ca/english/about/cwr_interim/
35. See the discussion in A. Forrest, “Organizing Eaton’s: Do chapter_4_6.php>. For a summary of the model proposed
the Old Laws Still Work?” (1988) 8 Windsor YB Access in British Columbia in 1992, see D. Doorey, “The Model of
Just 190. Sectoral Bargaining Everyone Is Whispering About,” online,
36. The story of attempts to organize bank branches is Law of Work (blog): <http://lawofwork.ca/?p=8574>.
recounted in E. Lennon, “Organizing the Unorganized: 40. Ontario Ministry of Labour, supra not 39 at part 4.6.1.

CHAPTER 34
The Law of Industrial Conflict

II. Mapping the Options for Resolving a Collective
• Describe the two routes used in Canada for resolving a collective Bargaining Deadlock 557
bargaining impasse. III. The “Economic Warfare” Route 559
• Explain how the law defines “strike” and “lockout.” A. Union and Employee Weapons: The Strike 560
• Describe the preconditions for a lawful strike or lockout. B. Employer Weapons: Lockouts and Unilateral Alteration of
• Explain why and when an employer can unilaterally amend terms of Terms of Employment 570
employment without the union’s consent. IV. The Interest Arbitration Route 572
• Describe the arguments for and against allowing employers to use
replacement workers during a work stoppage.
• Explain the rights of striking and locked-out workers to return to their Appendix 579
previous jobs.
• Understand how Canadian law regulates labour picketing during work
stoppages.
• Explain four situations in which a collective bargaining impasse would
be resolved by interest arbitration rather than by “economic warfare.”
I. Introduction
In the vast majority of cases, collective bargaining between employers and unions results in a
new collective agreement without any work stoppage or need for government intervention. The
parties reach a deal, sign a new collective agreement, and move on. However, while our legal
model compels the parties to sit down and bargain with one another, it does not—indeed could
not—force them to reach an agreement every time. It is inevitable that sometimes collective
bargaining will meet an impasse, and as we learn in this chapter, the industrial conflict that
results is a matter of great concern to our governments and the courts. As we work our way
through this law in this chapter, think about what interests are being promoted by the laws. Do
the laws favour one side or the other in the collective bargaining dispute? To what extent do the
laws seek to protect third parties—people and organizations that are not directly involved in the
dispute—from the effects of industrial conflict?
II. Mapping the Options for Resolving a Collective

Bargaining Deadlock
The law of industrial conflict is complicated.1 Grab a caffeinated beverage and a snack! All three
regimes of work law (the common law regime, the regulatory regime, and the collective bargaining
regime) converge here, each regulating parts of the whole of industrial conflict law. We will focus
on the role of the common law and collective bargaining regimes in this chapter, but the
557

regulatory regime also plays a role. To provide just one example, the fact that workers involved
in a work stoppage are disqualified from employment insurance benefits in Canada works to the
advantage of employers in a collective bargaining dispute.2
When collective bargaining reaches an impasse, two legal routes are used in Canada to break
the deadlock. First, our legal model permits “economic warfare”—the use of blunt economic
pressure to persuade the other party to make concessions in the form of strikes, lockouts, and
the unilateral imposition of contract terms by the employer. Second, bargaining disputes can be
referred to a neutral third-party arbitrator—an interest arbitrator—for resolution. An interest
arbitrator is tasked with resolving bargaining disputes by writing the terms of a collective agree-
ment for the parties. These two legal routes and the source of laws that govern them are depicted
in Figure 34.1.
FIGURE 34.1 When Collective Bargaining Reaches an Impasse: Two Legal Routes
Legal Rules Regulating Strikes and Lockouts

• Collective bargaining statutes:
– strike/lockout definitions
– timeliness of lawful strikes/lockouts
– preconditions to a lawful strike/lockout
– job rights of strikers and locked-out workers
– replacement worker laws
– labour relations board and labour arbitration remedies for
unlawful strikes and lockouts
– “final offer votes” and “ratification votes” (Chapter 33)
THE “ECONOMIC • Common law rules:
WARFARE” ROUTE – torts regulating labour picketing
– injunction law and common law damages for unlawful strikes
Other Weapons Available to Employers

• Employers may request that the government order a vote of
employees of its final offer put to the union (a final offer vote).
Collective Bargaining
Employers may also unilaterally change working conditions
Reaches an Impasse
once it is in a lawful lockout position. Employees can then either
accept the changed terms or go on strike.
Voluntary Interest Arbitration

• Collective bargaining statutes provide for consensual interest
arbitration if the parties agree to refer bargaining disputes to
binding arbitration.
Mandatory Interest Arbitration

THE INTEREST
ARBITRATION ROUTE • In some public sector workplaces, where “essential services”
are performed, the economic warfare route is not available.
Bargaining disputes must be resolved through binding interest
arbitration.
• Sometimes governments intervene and order interest
arbitration to end a bargaining dispute between employers and
unions that normally have access to the “economic warfare”
route (back-to-work legislation and first contract arbitration).

Chapter 34 The Law of Industrial Conflict 559
Most of the legal rules that govern industrial conflict are found in collective bargaining stat-
utes, such as the Ontario Labour Relations Act, 1995. Those statutes define what constitutes a
strike or lockout and when each is permitted, among other related subjects. It is the respon-
sibility of labour relations boards to enforce collective bargaining statutes, so labour boards play
an important role in the regulation of industrial conflict. The main functions of courts in the
regulation of industrial conflict are (1) to review the decisions of labour tribunals through the
process judicial review; and (2) to apply tort law (see Chapter 16) to the actions of unions,
employers, and especially workers, particularly picket-line behaviour.
III. The “Economic Warfare” Route

Collective bargaining statutes permit each side in the bargaining dispute to deploy legal weap-
ons to pressure the other to make concessions. For the workers and the union, the main weapon
is the strike. For the employer, it is a lockout or the ability to unilaterally alter the terms of
employment. The party that can afford to hold out during a work stoppage the longest usually
has a power advantage, giving it an edge in the economic warfare route. As noted in the previous
chapter, which party possesses that power is affected by a variety of factors, including the legal
rules that govern work stoppages discussed in this chapter, as well as forces produced by external
inputs (see Chapter 2), such as labour and other market forces and the social and cultural cli-
mate in which a work stoppage occurs. An employer in an intensely competitive sector may be
less able to withstand a work stoppage than one with few competitors. Workers on strike in a
community with deep roots in the labour movement may receive greater public support and
sympathy than strikers in a town with little union presence.
Workers lose their wages during a work stoppage and depend on what is usually a relatively
paltry strike pay stipend from the union, or they look for alternative work. Depending on the
extent to which they can continue to operate during a work stoppage, private sector employers
may incur lost output and, therefore, lost revenues and profits. As we will see in Chapter 38, the
dynamic for public sector employers is different, since governments continue to collect revenues
(taxes) during a work stoppage while saving on labour costs. Therefore, the bargaining pressure
imposed on government employers is usually political rather than economic.
As we learned in Chapter 33, the duty to bargain in good faith permits a party to engage in
“hard bargaining” to win the agreement it wants. The laws governing the economic warfare
route are not intended to substitute for inequality of power by propping up the weaker party, as
explained by the Ontario Labour Relations Board:
In assessing the economic weapons available the Board must be cautious that it does not become the
arbiter as to the parties’ choice of economic weapons; nor is it for the Board to attempt to equalize the
economic power available to the parties. The Board’s only concern is to determine whether the activ-
ities of the parties exceed the bounds of permissible activity so as to contravene the provisions of the
Labour Relations Act.3 [Emphasis added]
lockout: A tactic whereby an employer refuses to permit employees to report to work and to pay the employees to apply
pressure on the employees and their union in collective bargaining.
strike pay: A payment made by a union to a union member or person in a bargaining unit during a work stoppage, often as
consideration for performing a shift as a picketer.

Therefore, the economic warfare route involves the use of blunt power to achieve desired
bargaining outcomes.
A. Union and Employee Weapons: The Strike

The vast majority of collective agreements are negotiated and settled without a work stoppage.
Moreover, as depicted in Figure 34.2, the frequency of strikes in Canada has been trending
downward since the 1980s.4
FIGURE 34.2 Strike Incidence in Canada and Person-Days Lost, 1991 – 2018
500 4.5
Number of strikes
begun in year
450 (left scale)
400 Person-days lost

(right scale) 3.5
350
Person-days Lost (millions)

Number of Strikes
300
2.5
250
200
1.5
150
100
50 0.5
1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018
Year
Sources: Economic and Social Development Canada, “Work Stoppages in Canada, by Jurisdiction and Industry,” online:
<https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=1410035201>; and M. Gunderson, B. Hebdon, &
D. Hyatt, “Strikes and Dispute Resolution” in M. Gunderson & D. Taras, Canadian Labour and Employment
Relations, 6th ed (Toronto, ON: Pearson Education Canada, 2009) at 342.
Canadian governments have long sought to restrain the power of the strike in order to pro-
tect employer interests and third parties who could be affected by work stoppages.5 As Professor
Paul Weiler noted, “a characteristic feature of Canadian law is that we have been remarkably
ambitious in our use of the law to limit collective employee action … [We] have gone about as
far as we can go in legally regulating strike action.”6 However, in recent years, and as explored
in Chapter 39, the Supreme Court of Canada has emphasized that the right to strike is a funda-
mental component of the Canadian collective bargaining model. As Justice Abella of the Su-
preme Court explained in the case of Saskatchewan Federation of Labour v. Saskatchewan: “the

right to strike is an essential part of a meaningful collective bargaining process in our system of
labour.”7
Contemporary collective bargaining laws protect a limited “right to strike,” but that is not
their central purpose. Recall our discussion in Chapters 28 and 29 of the origins of the Wartime
Labour Relations Order, or Order in Council PC 1003 (1944), and how it came about in large
measure as a response to growing industrial unrest and as an attempt to control and limit the
number of strikes.
1. What Is a Strike?

The “right to strike” appears in our laws as a statutory prohibition on employers from disciplin-
ing or terminating employees who engage in a “lawful” strike. Therefore, it is crucial that we
understand (1) what constitutes a strike, and (2) when a strike is lawful. A refusal to work by
employees that does not meet the statutory definition of a “strike” is not covered by the law’s
protections of collective worker activity and would usually amount to a serious violation of the
employment contract by those employees.
The statutory definition of “strike” varies slightly across Canadian jurisdictions. In all juris-
dictions, a strike is defined to include a “cessation or refusal to work” by “two or more workers”
who are “acting in combination” and with “a common understanding.” The key here is that a
strike involves a coordinated act of more than one worker to not work. A single worker who
drops their tools and stands outside the workplace protesting their employer’s low pay is not on
strike, but if two or more workers agree to drop their tools and picket, they may be. All jurisdic-
tions also include in their definition of “strike” a deliberate slowdown intended to restrict the
employer’s output, a strategy often described as work to rule. Once employees are in a legal
strike position, they can engage in a full work stoppage, a work to rule, or rotating strikes.
a. The Broad Definition of Strike

Where definitions of “strike” vary is in regard to what we might call the motive element. Does it
matter why workers are refusing to work or are slowing down? Most jurisdictions (including
Ontario, British Columbia, and Saskatchewan) define “strike” broadly and do not include a
motive element. In other words, it does not matter why workers are refusing to work. Consider,
for example, the definition of “strike” in the Ontario Labour Relations Act, 1995:
“strike” includes a cessation of work, a refusal to work or to continue to work by employees in com-
bination or in concert or in accordance with a common understanding, or a slow-down or other
concerted activity on the part of employees designed to restrict or limit output.8
That definition has two parts. The first refers to concerted refusals to work and the second to
a “slowdown” designed to restrict output. Note that the definition does not specify that the
refusal to work be intended to apply pressure on the employer in collective bargaining. The employ-
ees’ motive for refusing to work is irrelevant. As long as the employees agreed among themselves
to not work, then they are striking, regardless of the motive for their actions. So when employees
of General Motors in Ontario skipped worked one day to attend a political rally protesting prov-
incial government policy, they engaged in a strike.9 The fact that the intention of the strike was
to influence government policy and not General Motors’ labour practices did not matter. As
work to rule: A form of strike in which workers collectively and deliberately slow down for the purpose of restricting the
employer’s output.
rotating strike: A form of strike in which some or all workers sporadically engage in some form of strike action. For example,
workers might strike on Tuesday but report to work the rest of the week, or groups of workers may strike while others do not.

long as the workers had a common understanding that they would skip work that day, they
engaged in a strike.
The case in Box 34.1 is from British Columbia, where the definition of “strike” similarly does
not include a motive element. This case involved a collective refusal by employees to work vol-
untary overtime.10 Can that refusal be a strike?

Is the Refusal to Work Voluntary Overtime a Strike?
Dick’s Lumber & Building Supplies Inc. v. United Issue: Was the refusal by the employees to work voluntary
Steelworkers of America, Local No. 1-3567 overtime a strike?
2006 CanLII 28067 (BCLRB)
Decision: Yes. The labour relations board concluded that the
Key Facts: The United Steelworkers (the union) represented workers had collectively agreed, with the encouragement of
employees at three separate locations of the employer. Work- the union, to refuse overtime. The labour relations board ruled
ers at the Surrey location were on strike. Workers at the Burn- that the union had subtly encouraged the employees to de-
aby location were not on strike, and there was a “no strike” cline overtime when it told them of their right to do so. The
clause in the collective agreement that prohibited them from fact that the union or some employees believed it was import-
engaging in a strike. Overtime at the Burnaby location was ant to support the striking Surrey workers by refusing overtime
voluntary (employees were not required to work it), but the is irrelevant. There was a collective refusal to work overtime,
employees usually jumped at the opportunity to work over- and that action met the definition of a strike. Since the Burnaby
time to receive the extra pay. However, one day, after the union workers were not in a legal strike position, the labour relations
had reminded them that overtime was voluntary, 18 out of 23 board declared the strike to be illegal and ordered the union
Burnaby employees declined the employer’s request to work and employees to cease and desist from refusing to work
overtime. The employer filed a complaint with the BC Labour overtime.
Relations Board, arguing that the refusal to work overtime
constituted an illegal strike.
When the statute does not include a motive element—a requirement that the work refusal be
intended to influence the employer’s bargaining position—then a decision by workers to refuse
to cross a picket line (a “sympathy strike”) would also amount to a strike, provided that the
refusal is by more than one person acting with a common understanding and the statute does
not otherwise permit sympathy strikes. If workers refuse to cross a picket line for their own
personal reasons, including fear, and there is no evidence they acted with a common under-
standing, then there is no strike.11 Note though that in British Columbia, the definition of
“strike” excludes a work refusal “that occurs as the direct result of and for no other reason” than
the workers are respecting a lawful picket line. This language means that in British Columbia,
workers who fail to report to work because they are respecting a picket line are not engaged in
a strike.12
b. The Narrow Definition of Strike

Now consider the definition of “strike” in the Manitoba Labour Relations Act. The Manitoba
definition lists the usual types of conduct included in strike definitions (refusal to work or a
sympathy strike: A strike undertaken by workers who do not have an immediate and direct grievance against their own
employer, but who strike as a means of showing support and solidarity with other striking workers who do have such a griev-
ance with their employer.

slowdown on the part of employees in combination), but then adds a motive element that
requires those actions to be
for the purpose of compelling their employer to agree to terms or conditions of employment or to aid
other employees in compelling the employer of those other employees to agree to terms or conditions
of employment.13
Similar language is found in the collective bargaining legislation of Alberta and Nova Scotia.
That language requires that the work stoppage or slowdown be intended to influence the
employer’s position in collective bargaining. It is a narrower definition of “strike” than that
which appears in the Ontario and BC statutes. If workers in jurisdictions with a motive element
collectively skip work to attend a political protest, they are not engaged in a strike because their
actions are not intended to influence collective bargaining outcomes.14 Those workers may be
in breach of their employment contract and their duty to report to work, and they may be sub-
ject to employer-issued discipline. However, the laws governing strikes do not apply to their
actions because they are not striking.
2. When Is a Strike Lawful?

A strike is unlawful unless all of the legal preconditions for a lawful strike have been satisfied.
Those preconditions vary across the country, as depicted in Table 34.1. In all jurisdictions, a
lawful and therefore protected right to strike exists only for unionized employees, and then only
during a narrow window of time during collective bargaining and after a series of statutory
preconditions have been satisfied. Unionized workers who strike after these legal preconditions
have been satisfied experience a limited protection from dismissal or adverse treatment at the
hands of the employer (see the next section).15 Workers who strike before the preconditions
have been satisfied are said to have engaged in a wildcat strike and might be disciplined or ter-
minated by their employer. In some cases, employees who engage in a wildcat strike can be
ordered to pay damages to the employer, as can their union if the union encouraged or partici-
pated in the strike or did not take reasonable steps to end the strike once it learned about it.16
TABLE 34.1 Preconditions to a Lawful Strike

Preconditions to a Lawful Strike Found in Canadian Jurisdictions
Canadian Collective Bargaining Legislation Requiring the Precondition
• The workers are unionized. (Non-union employees who strike are probably breaching All Canadian jurisdictions
their individual employment contracts.)
• No collective agreement covering the striking employees is in effect.
• The union and the employer have engaged in collective bargaining with the intention
of reaching a new collective agreement, but failed to reach an agreement.
• The union has conducted a strike vote, and a majority of bargaining unit employees’
ballots support a strike.
Mandatory conciliation or mediation and a “cooling off” period: Alberta, Nova Scotia, Ontario, Prince Edward
• A government-appointed conciliation officer has met with the parties, but has been Island, Saskatchewan, New Brunswick
unable to assist the parties to reach a new collective agreement.
• A mandatory “cooling off” period has passed since a date specified in the statute.
Precise details vary across jurisdictions, but in general, the “cooling off” period is from
7 to 21 days after the minister of labour has notified the parties that no more concilia-
tion will be ordered. (This notification is sometimes called a “no board” report because
the minister writes that no conciliation board will be appointed in the report.)
wildcat strike: A strike by employees that occurs during a period of time when a strike is not permissible according to collective
bargaining laws, such as during the term of a collective agreement.

Discretionary conciliation and a “cooling off” period: Federal, British Columbia, Newfoundland and
• The parties must inform the minister of labour that bargaining has reached an Labrador, Manitoba
impasse. They may request conciliation or the government may require conciliation
before a “cooling off” period begins.
The union must provide notice to the employer of the date of the start of the strike. • Federal, Alberta, British Columbia: 72 hours’
notice
• Nova Scotia, Saskatchewan: 48 hours’ notice
• New Brunswick: 24 hours’ notice
• Quebec: 7 working days’ notice in the public
service
The preconditions for a lawful strike are designed to restrict strikes to those circumstances in
which collective bargaining has reached an impasse and a majority of affected employees have
elected to apply pressure on the employer by use of a work stoppage. The requirements for col-
lective bargaining, government conciliation, and a “cooling off ” period as preconditions for
lawful strikes date to early 20th-century legislation, such as the 1907 Industrial Disputes Investi-
gation Act. That legislation was the brainchild of Mackenzie King, who then was the federal
minister of labour.17 These key elements remain in some form in all Canadian collective bargain-
ing legislation. Industrial relations scholars have found that some of the legislative preconditions,
such as mandatory conciliation and mandatory strike votes, reduce strike incidence in Canada.18
3. Replacement Workers and the Rights of Strikers

It is an unfair labour practice (see Chapter 32) for an employer to punish workers for engaging
in a lawful strike.19 This protection from reprisals for engaging in a lawful strike—together with
statutory language across Canadian jurisdictions that specifies that workers do not cease to be
employees when they go on strike—is how collective bargaining statutes protect the “right to
strike.”20 A lawful strike does not end the employment relationship of a unionized employee or
give the employer grounds for dismissal, as would be the case for a non-union worker governed
by the common law regime.
However, an employee can still be disciplined or have their employment contract terminated
for engaging in an unlawful strike or for misconduct during a lawful strike (including behaviour
on a picket line).21 For example, in the case of CAW-Canada and its Local 112 v. Toromont Cat,
the dismissal of a striking employee for throwing a homemade explosive device onto the
employer’s property was upheld. The Ontario Labour Relations Board ruled that the employer’s
decision was not motivated by anti-union animus.22 In 2017, the Ontario government intro-
duced a law prohibiting employers from disciplining or terminating an employee who is
engaged in a lawful strike except for “just cause,” and requiring that disputes about whether “just
cause” exists be dealt with under the grievance procedure of the new collective agreement.23
Everywhere in Canada, employers are entitled to continue to operate during a strike or lock-
out by assigning work to non-striking employees, including managers and other non-bargaining
unit employees and bargaining unit employees who elect to continue to work. Moreover, every-
where except in British Columbia and Quebec employers can also hire new replacement work-
ers (sometimes referred to by the derogatory term “scabs” within labour movement terminology)
anti-union animus: The motive element of unfair labour practices; it means acting with an intention to defeat or undermine
the exercise of lawful activities by a union or union supporters.
replacement worker: A person who is employed to take the place of another worker who is on strike or locked out. See
also scab.

to perform the work of striking or locked-out employees.24 Ontario and Manitoba prohibit
employers from hiring “professional strikebreakers,” who are workers hired for the distinct pur-
pose of interfering with or disrupting the rights of strikers, but this does not prohibit employers
from hiring people “off the street” to be replacement workers.25
The ability to hire replacement workers makes it more feasible for employers to continue to
operate during a strike or lockout and thereby empowers employers. For example, during a
recent bitter work stoppage at a beer can factory in Toronto that dragged on for nearly two years,
the employer bussed in replacement workers each day, past demoralized picketers.26 Unions
routinely lobby governments to prohibit this practice, mostly without success. Whether the gov-
ernment should permit or prohibit replacement workers is one of the enduring debates in this
area of law. The two sides of that debate are described in Box 34.2.

Should Replacement Workers Be Permitted?
British Columbia and Quebec are the only jurisdictions in Can- knowing that the employer may not be able to operate
ada today that prohibit employers from using replacement during a work stoppage.
workers to perform the work of striking or locked-out employ- • If employers cannot use replacement workers, then
ees. Whether governments should prohibit replacement work- they may not be able to operate during a work stop-
ers is among the most hotly contested issues in collective page and, thus, could lose customers. A loss of custom-
bargaining law and policy.* The following arguments are usu- ers puts the business at risk, including the future job
ally presented by both sides of the debate. security of the workers presently on strike or locked out.
The arguments in favour of banning replacement workers • A ban on replacement workers will discourage invest-
include the following: ment in any jurisdiction that enacts such a law since
employers will avoid such a restriction if they can.
• The economic warfare route for resolving collective • The right to operate their business is a fundamental
bargaining disputes depends on economic pressure property right enjoyed by employers that should not
being brought to bear on employees, the union, and be restrained simply because there is a collective bar-
the employer. By permitting the employer to hire new gaining impasse.
workers to do the employees’ jobs, the law undermines
the economic leverage exerted on the employer during Industrial relations scholars have studied the impact of laws
the work stoppage, tilting the power balance in favour that ban replacement workers on strike incidence and duration.
of the employer. These studies find that such laws tend to increase the number
• Because the economic pressure on the employer is of strikes, but they are inconclusive on the question of strike
reduced by the ability to hire replacement workers, duration. In a 2009 study looking at data covering 1978 to 2003,
employers can hold out longer, and therefore the dura- Professors Paul Duffy and Susan Johnson of Wilfrid Laurier
tion of work stoppages will increase. University found that anti-replacement worker legislation in
• Hostility, anger, and resentment result when replace- British Columbia and Quebec caused an increase in the number
ment workers are bussed across picket lines. This kind of strikes, but decreased the length of strikes.† Earlier studies
of action plants seeds for violence and also poisons the using different methodologies and examining data up to 1985
industrial relations climate at the workplace after the similarly found that laws banning replacement workers in-
work stoppage is over. crease the incidence and duration of strikes.‡
The arguments in favour of permitting replacement workers * Sims Task Force, Seeking a Balance: A Review of the Canada Labour Code
include the following: (Ottawa, ON: Human Resources Development Canada, 1996) at 122.
† P. Duffy & S. Johnson, “The Impact of Anti-Temporary Replacement
• Nothing prevents workers involved in a work stoppage Legislation on Work Stoppages: Empirical Evidence from Canada” (2009)
from seeking alternative jobs to supplement their strike 35:1 Can Pub Pol’y 100.
pay, and therefore employers should not be prohibited ‡ J. Budd, “Strike Replacement Legislation and Collective Bargaining:
from continuing to produce goods and generate Lessons for the United States” (1996) 35:2 Indus Rel 245; M. Gunderson, J.
revenues. Kervin, & F. Reid, “The Effect of Labour Relations Legislation on Strike
• Banning replacement workers will cause more strikes Incidence” (1989) 22:4 Can J Econ 779; and M. Gunderson & A. Melino,
“The Effects of Public Policy on Strike Duration” (1990) 8:3 J Lab Econ 295.
because unions and employees will feel empowered

Once the work stoppage ends, could an employer retain replacement workers instead of
reinstating the employees who have been on strike or locked out? The short answer is “no.”
Unlike in the United States, workers who have been involved in a work stoppage in Canada can-
not be “permanently replaced.”27 Canadian collective bargaining statutes guarantee striking
employees a right to be reinstated to their former jobs once the strike (or lockout) ends.28 Con-
sider the language in the Canada Labour Code as an example:
At the end of a strike or lockout not prohibited by this Part, the employer must reinstate employees in
the bargaining unit who were on strike or locked out, in preference to any person who was not an em-
ployee in the bargaining unit on the date on which notice to bargain collectively was given and was
hired or assigned after that date to perform all or part of the duties of an employee in the unit on
strike or locked out.29 [Emphasis added]
Ontario’s law on the reinstatement of striking workers is unusual in the sense that it is
restricted to only six months from the date a lawful strike begins. The legislation requires an
employer to allow an employee to return to work at any time during or after a strike that lasts
six months or less, provided that the employee makes a request in writing and the work the em-
ployee does is still being done.30 If a strike lasts longer than six months, the employer may be
permitted to give preference to a replacement worker over the striking employee provided there
is a business reason for doing so and it is not to punish the employee for striking or for being a
union supporter.31
The Ontario legislation also requires the employer to allow a striker to return to work during
a strike as long as the work is still being done.32 The legislation permits an employee to cross a
picket line staffed by striking co-workers and return to work. As you might imagine, that em-
ployee will not be very popular with the strikers, especially since any gains won through the
strike will also be enjoyed by the employee who is not participating in the strike. Union mem-
bers who cross a picket line may experience discipline at the hands of the union, such as a fine,
for violating their contract with the union, known as a union constitution (see Chapter 37).
4. Labour Picketing

Workers picket for a few key reasons. First, through picketing workers seek to persuade custom-
ers, suppliers, non-striking employees, and replacement workers to stop doing business with the
employer, or at least to inform these groups of the issues in dispute and elicit their support
(persuasion). Second, through picketing workers have an opportunity to come together for a
common cause and support one another during a difficult and stressful time (solidarity). Third,
workers usually receive “strike pay” from the union in exchange for picketing, which is much
less than their usual wage but nevertheless provides some income during a work stoppage
(income).
The laws governing picketing balance competing interests. Workers and the union want to
communicate their message and apply economic pressure on the employer. The employer wants
to continue operating without disruption and to ensure that a picket line does not obstruct
people, supplies, and products from entering and leaving the business’s property. Finally, the
interest of other “innocent third parties” is to avoid economic harm from picketing and the
presence of a picket line. Imagine, for example, a picket line set up outside a shopping mall or
industrial park.33 Other businesses and mall customers that have no direct involvement in the
work stoppage may be economically affected by a picket line, particularly if the picketers make
it difficult to enter the mall or park.
Picketing involves both an expressive component and a physical component. Because picket-
ing involves the expression of ideas, and freedom of expression is an important right in any
democratic society, there is a strong argument that workers ought to have a robust right to
engage in informational picketing.34 Picketing also involves a physical component that may

include large numbers of people congregating in a small area, possibly with the explicit intention
of preventing or impeding the ability of people to cross an area, usually with the intention of
causing some inconvenience. There is a signalling element to picketing; people approaching a
picket line understand that they are being asked to turn around, and in some instances the mere
sight of a picket line may cause some people to do just that.35 The history and development of
picketing law is a story about how courts and governments have balanced the workers’ right of
expression with concerns about the perceived and actual effects of the physical component
of picketing.36
Nurses picket outside Province House in Halifax in 2014 after contract negotiations between the union and
Capital Health reached a stalemate.
Source: Istock.
In British Columbia, the Labour Relations Code closely regulates where and when picketing
can take place, and therefore the rules of picketing mostly involve the BC Labour Relations
Board interpreting those provisions.37 In the rest of the country, the law of picketing mostly
involves the courts applying tort law to picketing behaviour (see Chapter 16). Judges use torts
to regulate what picketers can say, where they can say it, and, most importantly, how they behave
on the picket line. An employer or third party adversely affected by picketing can file a lawsuit
against the picketers (and, in some cases, the union itself), asking a court to restrict or prohibit
the picketing. Once the lawsuit has been filed, the party filing it can then go before a judge (by
filing a motion) and ask for an interlocutory injunction to be ordered that would apply until a
full trial can be heard at a later date to decide the lawsuit. However, in reality those lawsuits
rarely go to trial because obtaining a quick injunction to restrict picketing is the real objective,
and the work stoppage usually ends before a trial date.38

The lawsuit must allege a proper “cause of action,” which means it must point to a legal rule
that has been violated. The three types of “causes of action” are (1) breach of contract, (2) breach
of statute, and (3) a tort. When picketing is in support of an unlawful strike, the cause of action
may involve either or both breach of contract and breach of statute. When that is the case, courts
have ordered injunctions to prohibit the unlawful strike and the picketing associated with it.39
When picketing is in support of a lawful strike or a lockout, the cause of action alleged is nor-
mally a tort. As we learned in Chapter 16, a tort is a judge-made legal wrong. A number of torts
could apply to picketing, as described in Table 34.2. For example, picketers who engage in
intimidation, trespass, defamation, physical obstruction of entry to or exit from a property
(nuisance), or violence on a picket line will be committing a tort (and maybe a criminal offence
too), and a court will likely order an injunction to restrict that behaviour.40
TABLE 34.2 The Most Common Torts Applicable to Picketing Behaviour

Tort Picketing Behaviour
Nuisance Picketers physically obstruct or prevent entry to or exit from a property, such as blocking
roadways.
Defamation Picketers make false and disparaging statements about the employer or others.
Trespass Picketers stand on private property and refuse to leave when asked.
Inducing Picketers knowingly encourage or cause someone to breach a contract they have with the
breach of employer. For example, a picket line that prevents a supplier from making a delivery to the
contract employer or encourages employees not on strike to breach their employment contracts by
not reporting to work could be inducing breach of contract.
Sometimes picketing is completely peaceful and involves workers standing around with “On
Strike” signs and attempting to distribute literature to people who approach the picket line. Even
in those cases, judges have sometimes intervened to restrain the picketing. In mid-20th-century
Britain, judges developed a new type of economic tort specifically to restrain labour picketing.41
For example, the tort of “inducing breach of contract” could be applied to almost any situation
in which strikers persuade someone who has a contract with the struck employer to decline to
cross the picket line and thereby breach their contract. That tort applies when (1) picketers know
there is a contract between the employer and a third party and intend by picketing to cause the
third party to breach that contract; (2) the third party does breach the contract; and (3) the em-
ployer suffers damages as a result.42 Think how those conditions could be satisfied if the picket-
ers encourage a supplier or an employee who is not in the striking bargaining unit to turn
around and not deliver their goods or not report to work, respectively.
Canadian courts and legislators historically distinguished between lawful primary picketing
and unlawful secondary picketing. This distinction was recognized in a famous decision of the
Ontario Court of Appeal from 1963 called Hersees of Woodstock v. Goldstein.43 Primary picket-
ing takes place at the location where the workers involved in the labour dispute work, whereas
secondary picketing takes place anywhere else. Primary picketing in support of a lawful strike
economic tort: A species of tort invented by British judges in the 20th century to restrain collective worker action that is
intended to cause economic harm.
primary picketing: Picketing that takes place at the location of the employer directly involved in the labour dispute.
secondary picketing: Picketing that takes place at a location other than the workplace of the employees involved in the
labour dispute.

was usually permitted, provided it was done peacefully, even if that picketing caused other
employees to decline to report to work, creating a limited defence to the tort of “inducing breach
of contract.”44 However, those protections were limited to primary picketing at the struck
employer’s business (and sometimes to picketing at other businesses that were helping the em-
ployer resist the effects of the work stoppage, known as “allies”).45 Secondary picketing, on the
other hand, was usually treated as unlawful with the result that courts would routinely order
injunctions prohibiting even peaceful secondary picketing.
This historical common law distinction between primary and secondary picketing was revis-
ited and overruled by the Supreme Court of Canada in the landmark 2002 case of R.W.D.S.U.,
Local 558 v. Pepsi-Cola Canada, which is summarized in Box 34.3.

The Right to Picket and the “Wrongful Action” Model
R.W.D.S.U., Local 558 v. Pepsi-Cola Canada Beverages law should nevertheless evolve in a manner consistent with
(West) Ltd. “Charter values.” Picketing is an expressive activity and, there-
2002 SCC 8 fore, “it engages one of the highest constitutional freedoms:
freedom of expression.” The Supreme Court introduced a new
Key Facts: During a bitter but lawful work stoppage at a Pepsi- “wrongful action model”: all labour picketing is lawful unless
Cola factory in Saskatchewan, employees initially picketed in it is done in a manner that constitutes a tort or violates some
front of the employer’s factory, but then also established picket other law. It described the sorts of behaviour on a picket line
lines at some managers’ homes, at a hotel where replacement that may be unlawful as follows:
workers were staying, and at various retail outlets that sold
Pepsi products, hoping to dissuade workers from accepting Picketing which breaches the criminal law or one of
delivery of Pepsi products. The employer applied to the courts, the specific torts like trespass, nuisance, intimida-
seeking an injunction to restrain the picketing. Some of the tion, defamation or misrepresentation, will be im-
picketing was clearly tortious because it involved violence, permissible, regardless of where it occurs. Specific
intimidation, and trespass. However, the picketing at the retail torts known to the law will catch most of the situa-
stores was peaceful. The lower court judge issued an injunction tions which are liable to take place in a labour dis-
prohibiting not only the tortious picketing but also all picket- pute. In particular, the breadth of the torts of
ing at secondary locations. The court of appeal overruled the nuisance and defamation should permit control of
part of the judgment banning peaceful secondary picketing, most coercive picketing. Known torts will also pro-
and the employer appealed that decision to the Supreme tect property interests. They will not allow for intimi-
Court of Canada. dation, they will protect free access to private
Issue: Is secondary picketing during a lawful work stoppage premises and thereby protect the right to use one’s
illegal per se? property. Finally, rights arising out of contracts or
business relationships also receive basic protection
Decision: No. The Supreme Court overruled the Hersees ap- through the tort of inducing breach of contract.
proach. It looked to the protection of freedom of expression
in the Canadian Charter of Rights and Freedoms. Although the No tort or crime had been committed by the Pepsi picketers
Charter does not apply directly to common law rules such as at the retail stores. Therefore, they were entitled to picket
the Hersees rule, the Supreme Court ruled that the common outside of retail stores selling Pepsi.
As a result of the Pepsi-Cola Canada decision, and as a general rule, labour picketing is now
assumed by courts to be lawful, regardless of where it takes place, as long as the manner in which
it is conducted is not otherwise illegal. This outcome reserves an important role for tort law. A
party seeking to have a court prohibit or limit either primary or secondary picketing must dem-
onstrate that the picketers are committing a crime or tort.46
Finally, some jurisdictions have passed legislation that restricts the right of courts to issue
injunctions to restrain labour picketing. For example, in Ontario, the Courts of Justice Act

requires that an employer demonstrate that the police were called and that the police were
unable to prevent “alleged danger of damage to property, injury to persons, obstruction of or
interference with the lawful entry or exit from the premises or breach of the peace” as a precon-
dition to obtaining an injunction.47 Applying this language, courts have ruled that an injunction
will not be issued to restrict peaceful picketing, even if the picketing has the effect of impeding
access to a property (i.e., that a nuisance has occurred), provided that the obstruction is reason-
able. For example, the court refused to grant an injunction to restrain picketing in the case of
Cancoil Thermal Corp. v. Abbott even though the judge found that “a civil nuisance may have
occurred” because picketers were stopping each person who attempted to cross the picket line
for at least 15 minutes to discuss the dispute.48
B. Employer Weapons: Lockouts and Unilateral Alteration of

Terms of Employment
Employers have three principle weapons at their disposal in the economic warfare route: final
offer votes, lockouts, and unilateral alteration of terms of employment.
1. Final Offer Votes

One option provided in collective bargaining legislation is to ask the government, once only, to
order a vote by employees on the last offer it put to the union. This option is known as a final
offer vote.49 Employers use a final offer vote when they believe they have tabled an offer that a
majority of employees would accept, but for some reason the union is declining to put the offer
to the employees.
2. Lockouts
Collective bargaining statutes align the timing of a lawful lockout with that of a lawful strike; the
moment workers can legally strike, their employer can legally lock them out. A lockout is unlaw-
ful if it takes place when the employer is not in a legal lockout position. Lockouts occur less
frequently than strikes for the obvious reason that in most cases the employer would prefer its
employees to be working. Between 2010 – 18, there was an average of 24.6 lockouts per year in
Canada, with the highest number (58) in 2013 and the lowest amount in 2018 (12).50 A lockout
involves an employer refusing to allow its employees to report to work. Does that mean that a
layoff due to lack of work or a disciplinary suspension of one or more employees is a “lockout”?
Both of these scenarios involve an employer telling employees not to report to work. We need
to look at the definition of “lockout” in collective bargaining statutes. Here is the definition of
“lockout” in the Ontario Labour Relations Act, 1995:
“lock-out” includes the closing of a place of employment, a suspension of work or a refusal by an

employer to continue to employ a number of employees, with a view to compel or induce the employ-
ees, or to aid another employer to compel or induce that employer’s employees, to refrain from exercis-
ing any rights or privileges under this Act or to agree to provisions or changes in provisions respecting
terms or conditions of employment. [Emphasis added]
Notice that this definition includes a motive element: the reason that the employer is not
allowing employees to work must be to pressure the employees to agree to terms of employment
or to refrain from exercising legal rights.51 Therefore, a temporary layoff due to a business down-
turn is not a lockout, provided that the purpose of the layoff is not to compel employees to forgo
statutory rights or to gain an edge in collective bargaining.52
final offer vote: A provision found in collective bargaining legislation that entitles an employer to have the last offer it presented
to the union’s negotiating team put to a ballot of employees. Employers can only exercise this right once per round of bargaining.

Union members were locked out in 2015 after rejecting Southern Railway of BC’s final
offer in contract negotiations.
Source: Shutterstock.
Whether a lockout is a good bargaining strategy for the employer depends on a number of
factors. For example, if an employer believes that a strike is inevitable, it may want to control
when the work stoppage begins. There are a number of strategic reasons why workers and their
union might want to delay the start of a strike, including waiting until winter ends so that picket
lines are more bearable, or waiting until a time in the business cycle when the employer is most
vulnerable if a work stoppage occurs. The employer can remove that union advantage by locking
out the workers earlier. Sometimes, workers and their union would be happy allowing the bar-
gaining to drag on, because the prevailing terms and conditions of employment are superior to
what the employer is seeking to obtain in negotiations. Imagine that the employer seeks to cut
wages and reduce the pension plan. As long as the employer is abiding by the terms of the old
collective agreement during collective bargaining, the employees may be happy with the status
quo. In that scenario, the employer may want to lock out the workers quickly to put pressure on
them to concede to the changes the employer wants.
3. Unilateral Alteration of Terms of Employment

The appendix to this chapter chronicles the collective bargaining between the City of Toronto
and the Canadian Union of Public Employees (CUPE) from 2011 to 2012. In 2009, a bitter
40-day “garbage strike” took place in Toronto, and in 2010 Rob Ford was elected as mayor on a
promise to, among other things, contract out garbage collection and ensure no “unnecessary
strikes” occurred. The turning point during negotiations in 2011 and 2012 came when the City
of Toronto announced its intention to unilaterally impose the last offer it had tabled to CUPE
unless a deal was reached by the date a legal strike or lockout could begin. In another case, in
2014, the University of Windsor imposed the terms of an offer it had made to the Windsor
University Faculty Association over the wishes of the union and much of the faculty.53 In both
of these cases, the unions had not taken a strike vote, and therefore the workers were not in a
position to strike, which is the weapon the law gives employees faced with an employer’s impos-
ition of contract terms, as explained in the case discussed in Box 34.4.


The Employer’s Right to Unilaterally Alter Terms of Employment
United Steelworkers 1-2693 v. Neenah Paper Company of Relations Act, 1995 as a whole, an employer is free to treat
Canada the old agreement as expired and introduce new terms of
2006 CanLII 9888 (Ont. LRB) employment. The Ontario Labour Relations Board explained
that employees are not required to accept the changed terms,
Key Facts: The collective agreement between the union and because the act allows them to respond by going on strike:
employer, a lumber company, expired on August 31, 2005. The
employer told the union that it was losing money and that it In Ontario, the Act is premised on the fact that the
would require employees to accept a pay cut. The parties met parties may engage in economic warfare once the
with a government conciliation officer, but no deal was strike/lock out conditions have been met. Such eco-
reached, and as of December 5, 2005, the parties were in a legal nomic warfare can, so long as it does not otherwise
strike/lockout position. Prior to that date, the employer sent constitute a violation of the Act, take a variety of
the union a letter that advised the union that unless a deal was forms. Unions can legally engage in strikes. They also
reached before December 5, it intended on that date to imple- may engage in other activity which does not amount
ment new terms of employment, including a 6.4 percent wage to a full blown work stoppage, in order to put pres-
cut and a substantial change to the pension plan, among other sure on the employer. Included in these tactics are
changes. On December 5, the employer began to apply the rotating strikes, overtime bans, “work to rule” activ-
new terms. The employees continued to work but advised the ities, etc. The employer has a similar broad range of
employer that they did not accept the change. The union filed economic weapons at its disposal (all of which must
an unfair labour practice complaint, arguing that an employer be exercised subject to the Act’s unfair labour prac-
was unlawfully bargaining directly with employees, that the tice provisions). It can lock out. It can hire replace-
employer could not unilaterally change terms of employment ment workers to replace locked out or striking
unless and until it has locked out its employees, and that doing workers. I see no reason why, subject to the other
so amounted to bad-faith bargaining (see Chapter 33). provisions of the Act, a unilateral implementation of
Issue: Can an employer unilaterally alter terms of employment new terms and conditions (which have been offered
without the union’s consent once the parties are in a legal to the union in collective bargaining) cannot form
strike/lockout position? part of the employer arsenal. As has already been
stated: if the union and the employees do not wish
Decision: Yes. Once the legal strike/lockout date has been to operate under the new terms and conditions they
reached, there is no longer a collective agreement in force, do not have to.
and the collective bargaining freeze (see Chapter 33), which
prohibits changes to terms of employment without the The union’s unfair labour practice complaint was
union’s consent, is over. Therefore, reading the Ontario Labour dismissed.
The reason an employer can change the terms of employment without the union’s consent is
that, once the employer is in a legal lockout position, there is no collective agreement in effect
and the statutory collective bargaining freeze (see Chapter 33) is expired. In some jurisdictions,
including British Columbia and Alberta, the right of an employer to unilaterally alter terms and
conditions of employment exists only if a lockout or strike has commenced.54
IV. The Interest Arbitration Route

The alternative to economic warfare as a means of resolving a collective bargaining impasse is
the interest arbitration route. The interest arbitration route is available in four situations, as
described in Table 34.3.

TABLE 34.3
Four Situations in Which Interest Arbitration Is Used to End a Collective
Bargaining Dispute
Voluntary interest arbitration The parties agree to refer their bargaining dispute to
a neutral third party who will settle the dispute.
Essential service workers who have no legal right to The economic warfare route is not available at all to
strike some workers who perform “essential services”
without which people would be put at risk.
Back-to-work legislation Some workers who do have a right to strike may

nevertheless be ordered back to work by the govern-
ment when there is concern that the public is being
harmed.
First contract arbitration Collective bargaining legislation in some Canadian

jurisdictions allows labour boards to order interest
arbitration when a newly certified union is unable to
reach a first collective agreement with the employer.
First, unions and employers may agree to refer a bargaining dispute to arbitration.55 That
process is governed by legislation and is known as voluntary interest arbitration. Voluntary
interest arbitration is not used all that frequently because one side or the other often believes its
interests are best served by sticking with the economic warfare route. Often the party that most
fears a work stoppage will propose referring the dispute to arbitration only to be rebuffed by the
other party.
Second, the economic warfare route is not available to some unionized public sector workers
at all, and bargaining disputes involving these workers are referred by statute to mandatory
interest arbitration. The most common example is workers who perform “essential services,”
such as police, firefighters, and medical providers, without whom a real risk to public health and
safety would exist.56 In recent years, some governments have, controversially, extended the
concept of “essential services” to include services that are important to the economy or would
cause inconvenience to the public if interrupted by a work stoppage, such as public transit, mail
delivery, and even air travel provided by a lone carrier (Air Canada) within a highly competitive
industry.57
Some types of essential service workers have a limited right to strike under a system known
as the “essential services designation model.” In this model, the union and employer must agree
on which, and how many, employees are required to protect the public from undue risk that
could be caused by a work stoppage.58 That agreement is written into an essential services
agreement. If the parties cannot agree, then the statute usually provides for the labour board to
decide.59 For example, this model typically applies to ambulance drivers, some health care work-
ers, and prison workers. The determination of the percentage of workers in a bargaining unit
that are deemed essential obviously affects the relative bargaining unit of the parties—if a very
large percentage of workers are deemed “essential” and therefore are unable to strike, then the
voluntary interest arbitration: A procedure in which a union and employer agree to refer outstanding collective bargaining
issues to an interest arbitrator to resolve.
mandatory interest arbitration: Statutorily required interest arbitration to resolve collective bargaining impasses. Replaces
the right to strike and lockout.
essential services agreement: An agreement between an employer and a union that identifies which and how many
employees are “essential” to protect public safety and therefore cannot participate in a work stoppage.

threat of a strike is watered down or completely illusory.60 Because the stakes are high, disputes
over essential services agreements are not uncommon.61 We will consider essential services
again in Chapter 38.
Third, parties may end up at interest arbitration as a result of back-to-work legislation. A
legal strike or lockout may be brought to an end by the government because of concerns that the
work stoppage is causing too much disruption, risk, or harm to third parties or the economy.
Back-to-work legislation declares a strike or lockout immediately over, orders workers back to
work, and refers any outstanding bargaining issues to be decided by interest arbitration.62 Can-
adian governments have been very willing to use back-to-work legislation to end work stop-
pages, particularly public sector strikes involving teachers, college and university staff, transit
workers, and municipal workers, such as garbage collectors.63 In light of the recent Supreme
Court case of Saskatchewan Federation of Labour v. Saskatchewan, where it was ruled that the
Charter also protects a right to strike, back-to-work legislation is now susceptible to a constitu-
tional challenge. We will explore this issue in Chapter 39.64
Fourth, parties may end up at interest arbitration through first contract arbitration. As the
name suggests, access to interest arbitration through this route is available only in the case of
collective bargaining for the first collective agreement after a union has been certified. The basic
theory underlying first contract arbitration is that the collective bargaining process is new, the
employer and employees are inexperienced, and the bargaining relationship is immature.65
Together, these factors are a recipe for conflict. According to Professor Paul Weiler, first contract
arbitration allows for “a trial marriage, one that could allow the parties to get used to each other
and lay the foundations for a more mature and enduring relationship.”66 First contract arbitra-
tion is available in some form across Canada except in Alberta, New Brunswick, and Prince
Edward Island. The conditions to access first contract arbitration vary.67 For example, in Mani-
toba and Quebec, access to first contract arbitration is almost automatic after a period of failed
negotiations has passed.68 In Ontario and British Columbia, the party seeking first contract
arbitration must demonstrate that negotiations have failed because of the recalcitrance of the
other party, which may involve bad-faith bargaining (see Chapter 33) but need not.69
Chapter 38 explores in greater detail the process and criteria used by interest arbitrators.
Briefly, in a typical interest arbitration proceeding, both union and employer will attempt to
persuade the interest arbitrator (or interest arbitration board consisting of three members) that
their proposed collective agreement terms are more reasonable than the other side’s proposals.
It then falls to the arbitrator (or arbitration board) to decide and impose a final collective agree-
ment on the parties.
Legislation ordering mandatory interest arbitration may leave it to the parties to agree upon
the method of arbitration, or it might specify the method to be used. For example, the Toronto
Transit Commission Labour Disputes Act, 2011, which prohibits employees of Toronto’s transit
authority from striking, allows the parties to agree upon the method of arbitration failing which
the method will be mediation-arbitration.70 Back-to-work legislation introduced by the federal
Conservative Party in 2011 prohibiting a strike at Canada Post imposed final offer selection
arbitration, which requires the union and employer to submit a “final offer” on all outstanding
back-to-work legislation: A statute enacted for the specific purpose of bringing an end to a lawful work stoppage by referring
outstanding bargaining issues to an interest arbitrator for final resolution.
first contract arbitration: A statutory provision that refers a collective bargaining impasse during negotiations for a first
collective agreement to interest arbitration. Conditions for accessing first contract arbitration vary by jurisdiction.
mediation-arbitration: A method of interest arbitration in which the arbitrator acts firstly as a mediator to try to help the
parties reach an agreement, failing which the arbitrator issues a binding decision resolving the dispute.
final offer selection: A form of interest arbitration in which the interest arbitrator is restricted to imposing either the employer’s
or the union’s proposed collective agreement in its entirety.

matters and limits the arbitrator to selecting “either the final offer submitted by the employer or
the final offer submitted by the union.”71
V. Chapter Summary

This chapter is longer than most in this text because the law of industrial conflict is so very
complicated. That law weaves statute and common law rules together in often complex ways as
it develops the two routes for resolving collective bargaining impasses: (1) the economic warfare
route and (2) the interest arbitration route. In a very general way, we can say that collective
bargaining statutes and collective agreements, enforced by labour relations boards and labour
arbitrators, regulate the what and when of strikes and lockouts, and the common law courts
(mostly through the application of tort law) regulate the how and where of strikes and picketing.
However, that does not tell the whole story. As we saw in this chapter, the rules vary across juris-
dictions. Moreover, many—about 65 percent or more—Canadians have no legally protected
right to strike at all. That is because in Canada, only unionized workers are protected from em-
ployer reprisals for striking, and only about 30 percent of Canadians are unionized (see Table
28.2). Included in that 30 percent are many public sector workers who are prohibited from
striking because they perform “essential services.” Not surprisingly, Canada is often described
as having a very narrow right to strike.

1. Describe the preconditions that must be satisfied before a strike is lawful in your
province.
2. What is a lockout?
3. Why do workers picket during a strike or lockout?
4. When can an employer unilaterally impose new terms of employment on unionized work-
ers? What options are available to the workers when an employer takes that action?
5. Explain the difference in the approach to picketing in the Hersees of Woodstock decision
and the Pepsi-Cola Canada decision. Provide three examples of picketing behaviour that
would likely be ruled unlawful after the Pepsi-Cola Canada decision and explain why they
would likely be unlawful.
6. What is the role of an interest arbitrator? Describe four situations in which a collective
bargaining dispute would be resolved through interest arbitration rather than through the
economic warfare route.
APPLYING THE LAW

1. Would the following scenarios be considered a “strike” c. An employee storms out of the workplace after an
in a province where the definition of strike in the argument with a supervisor and yells that he is not
collective bargaining statute: (1) includes a motive coming back until the supervisor is “gone.”
element; and (2) does not include a motive element. d. Three employees miss work to attend a political
If you need more information in order to answer the protest together about government cuts to welfare
question, what information do you need? rates.
a. A group of employees refuse their employer’s e. Three employees decide to work slower because
request to work overtime as part of a strategy to their employer is proposing wage cuts in collective
pressure the employer to give employees a raise. bargaining.
b. Three employees refuse to voluntary overtime 2. A legal strike has begun at County Beer Company.
because they each have childcare responsibilities Striking employees have set up a picket line on the
that night. road that leads into the warehouse. They are asking

each car to stop and wait for a period of three minutes, order banning the picketers from slowing down
handing out leaflets, and engaging in discussions with drivers entering the workplace?
drivers about the reasons for the strike. Because of the 3. If County Beer Company was in your province, could
picket line, it is taking on average about 15 extra min- the company hire replacement workers to perform the
utes for non-striking employees to get into the work- work of the striking employees?
place. County Beer is wondering if it can put a stop to 4. Assuming that County Beer hires replacement workers,
the picketing. What process would the company follow once the strike is over can it refuse to allow striking
to obtain a legal order limiting the picketing, and do employees to return to work because replacement
you believe they would be successful in obtaining an workers have filled their jobs?

1. The industrial conflict chapter in a leading law school text 11. See, for example, Unilux Boiler Corp. 2005 CanLII 20765
runs almost 100 pages! See Labour Law Casebook Group, (Ont. LRB); and MacMillan Bloedel (Alberni) v. Swanson et
Labour and Employment Law: Cases, Materials, and Com- al., 1972 CanLII 1070 (BCSC).
mentary, 9th ed (Toronto, ON: Irwin, 2018) at chapter 8. 12. BC Labour Relations Code, supra note 8, s. 1. See Dollar
2. Employment Insurance Act, SC 1996, c. 23, s. 36(1). Thrifty Automotive Group Canada Inc., 2013 CanLII 51440
3. Ontario Hydro, [1970] OLRB Rep. Dec. 962 at para 15. (BCLRB).
4. M. Gunderson, B. Hebdon, & D. Hyatt, “Strikes and 13. Manitoba Labour Relations Act, CCSM c. L10, s. 1. See also
Dispute Resolution” in M. Gunderson & D. Taras, ed, Can- Nova Scotia Trade Union Act, RSNS 1989, c. 475, s. 2(v).
adian Labour and Employment Relations, 6th ed (Toronto, 14. The BC Labour Relations Code, RSBC 1979, c. 212,
ON: Pearson Education Canada, 2009) at 342; Employ- included a motive element until 1984. In several cases, the
ment and Social Development Canada, Overview of Collec- board ruled that collective work refusals that were not
tive Bargaining in Canada, 2015 (Ottawa, ON: Her Majesty intended to pressure the employer in bargaining were not
the Queen in Right of Canada, 2016), online (pdf): “strikes”: British Columbia Hydro and Power Authority
<https://www.canada.ca/content/dam/esdc-edsc/ [1976] 2 CLRBR 410; and Canex Placer Limited (Endako
migration/documents/eng/resources/info/publications/ Mines Division) [1975] 1 CLRBR 269.
collective_bargaining/ocba2015-eng.pdf>. 15. See, for example, Ontario Labour Relations Act, 1995,
5. These efforts to restrain strikes during the first half of the supra note 8, s. 1(2) (no person ceases to be an employee
20th century are recounted in detail in J. Fudge & E. for reason only that they stop working owing to a strike or
Tucker, Labour Before the Law: The Regulation of Workers’ lockout); and s. 5 (every person is free to participate in
Collective Action in Canada, 1900 – 1948 (Toronto, ON: lawful activities of a union).
Oxford University Press, 2001), and, in the later decades of 16. Natrel Inc., 2005 CanLII 67419 (Ont. LA); Mosaic Potash
the century, in L. Panitch & D. Schwartz, From Consent to Colonsay ULC, 2012 CanLII 58952 (Sask. LRB); King v.
Coercion: The Assault on Trade Union Freedoms, 3rd ed Deputy Head (Canada Border Services Agency), 2010
(Aurora, ON: Garamond, 2003), especially chapter 4. PSLRB 125; General Motors of Canada Ltd., 2000 CanLII
6. P. Weiler, Reconcilable Differences: New Directions in 9564 (Ont. LRB); and Petrow v. Limo Jet Gold Express Ltd.,
Canadian Labour Law (Toronto, ON: Carswell, 1980) at 2009 CanLII 4193 (BCLRB).
68-69. 17. Wartime Labour Relations Order, PC 1003, s. 21. For a dis-
7. Saskatchewan Federation of Labour v. Saskatchewan, 2015 cussion of the history of the Industrial Disputes Investiga-
SCC 4 at para 3. See also H. Laski, Liberty in the Modern tion Act, see Fudge & Tucker, supra note 5 at chapter 2.
State (London, UK: Penguin, 1938) at 128-31. 18. See, for example, M. Gunderson, A. Melino, & F. Reid,
8. Ontario Labour Relations Act, 1995, SO 1995, c. 1, Sched. “The Effects of Canadian Labour Relations Legislation on
A, s. 1. See also Saskatchewan Employment Act, SS 2013, c. Strike Incidence and Duration” (1990) 41:8 Lab LJ 512.
S-15.1, s. 6.1(n); and BC Labour Relations Code, RSBC 19. Canadian Pacific Railway Co. v. Zambri, [1962] SCR 609;
1996, c. 244, s. 1 (for a definition of “strike”). Chisholm v. Dominion Citrus and Drug, 1982 CanLII 967
9. General Motors of Canada Limited, 1996 CanLII 11152 (Ont. LRB); and Canada v. Graham Cable TV/FM (1986),
(Ont. LRB). 12 CLRBR (NS) 1.
10. Dick’s Lumber & Building Supplies Inc., 2006 CanLII 28067 20. Ontario Labour Relations Act, supra note 8, s. 1(2). See
(BCLRB); and Cambridge (City), 1989 CanLII 3014 also the discussion in G. Adams, Canadian Labour Law,
(Ont. LRB). 2nd ed (Aurora, ON: Canada Law Book, 1993) at

s. 11(1)(iii); and McGavin Toastmaster Ltd. v. Ainscough, 32. Ontario Labour Relations Act, supra note 8, ss. 80(1)
[1976] 1 SCR 718. and (2).
21. International Wallcoverings, 1983 CanLII 764 (Ont. LRB) 33. See, for example, Sobeys Capital Incorporated, 2011 CanLII
at para 36 (upholding termination of employees for picket- 73739 (Alta. LRB); Cadillac Fairview Corp. Ltd. v.
line violence). Often employers and unions agree, as part R.W.D.S.U. (C.A.), 1989 CanLII 4334 (Ont. CA); and
of the settlement of a strike or lockout, that workers disci- AirTime Express Inc. v. Teamsters Local Union No. 419,
plined or terminated for alleged misconduct during a work 2017 ONSC 5401.
stoppage can refer a grievance to an arbitrator for review 34. R.W.D.S.U., Local 558 v. Pepsi-Cola Canada Beverages
of the employer’s decision. (West) Ltd., 2002 SCC 8 at para 32.
22. Toromont Cat, 2001 CanLII 5107 (Ont. LRB). 35. Weiler, supra note 6 at 78-85; Fletcher Challenge Canada
23. Ontario Labour Relations Act, supra note 8, s. 80.1 Ltd. v. Communications, Energy and Paperworkers Union of
24. BC Labour Relations Code, supra note 8, s. 68; and Quebec Canada, 1998 CanLII 6528 (BCCA); and Loblaws Com-
Labour Code, CQLR c. C-27, s. 109. The Canada Labour panies Ltd., 2011 CanLII 4556 (BCLRB).
Code, RSC 1985, c. L-2, s. 94(2.1), prohibits replacement 36. There is a rich academic literature: A.W.R. Carrothers,
workers that are used to undermine the “union’s represen- “Recent Developments in the Tort Law of Picketing”
tational capacity rather than the pursuit of legitimate bar- (1957) 35 Can Bar Rev 1005; P. Bergbusch, “Secondary
gaining objectives.” See L. Vaillancourt, “Amendments to Picketing in Saskatchewan: A Functional Analysis of O.K.
the Canada Labour Code: Are Replacement Workers an Economy v. R.W.D.S.U., Local 454” (1995) 59 Sask Law Rev
Endangered Species?” (2000) 45 McGill LJ 757. 141; H. Arthurs, “Comments” (1963) 41 Can Bar Rev 573;
25. Ontario Labour Relations Act, supra note 8, s. 78. and H. Arthurs, “Tort Liability for Strikes in Canada:
Some Problems of Judicial Workmanship” (1960) 38 Can
26. See S. Mojtehedzadeh, “Bitterness Remains as Crown
Bar Rev 346.
Metal Workers End 2-Year Strike” (July 2015), Toronto
Star, online: <https://www.thestar.com/news/ 37. BC Labour Relations Code, supra note 8, ss. 65, 66. The
gta/2015/07/20/bitterness-remains-crown-metal-workers code protects lawful picketers from lawsuits alleging tres-
-end-2-year-strike.html>. pass, interference with contractual relations, and loss of
business caused by picketing. On the distinctive regime of
27. For a discussion of American strike law, see P. Secunda et
strike regulation in British Columbia, see R. Brown, “Pick-
al. Mastering Labor Law (Durham, NC: Carolina Academic
eting: Canadian Courts and the Labour Relations Board of
Press, 2014), chapters 14-16. In the common law regime,
British Columbia” (1981) 31 UTLJ 153 and Weiler, supra
before legislation intervened, an employer could hire
note 6, chapter 2. See also Westfair Foods Ltd., 2000 CanLII
replacement workers and retain them over strikers once
27296 (BCLRB); and Westminster Savings Credit Union,
the strike ended: Canadian Pacific Railway Co. v. Zambri,
2019 CanLII 60896 (BCLRB).
supra note 19, per Locke J.
38. The test for obtaining an interlocutory injunction was set
28. Canada Labour Code, supra note 24, s. 87.6; Saskatchewan
out in the non-labour case of RJR—MacDonald v. Canada
Employment Act, supra note 8, ss. 6-37; Manitoba Labour
(Attorney General), [1994] 1 SCR 311. Basically, it requires
Relations Act, supra note 13, s. 12; Quebec Labour Code,
the party seeking the injunction to establish (1) that the
supra note 24, s. 110.1; and Alberta Labour Relations Code,
lawsuit has established a strong prima facie case; (2) that
RSA 2000, c. L-1, s. 90. In Ontario, the legislation does not
the party will suffer “irreparable harm” if the injunction is
include an expressed requirement on employers to rein-
not issued; and (3) that the “balance of harm” favours that
state a locked-out employee. However, the board has inter-
party.
preted the legislation to include a right of employers to
hire “temporary” replacements during a lockout; see 39. Gagnon et al. v. Foundation Maritime Ltd., [1961] SCR
Westroc Industries Ltd., 1981 CanLII 1034 (Ont. LRB). 435; and St. Anne Nackawic Pulp & Paper v. CPU, [1986] 1
SCR 704.
29. Canada Labour Code, supra note 24, s. 87.6.
40. Bulk-Lift Systems Ltd. v. Warehousemen and Miscellaneous
30. Ontario Labour Relations Act, supra note 8, s. 80. See
Drivers’ Union Local 419 et al., 1975 CanLII 366 (Ont. H
Dover Corporation (Canada) Ltd., 1997 CanLII 15568
Ct J); Alumicor Limited. v. United Steel, Paper and Forestry,
(Ont. LRB); and Mini-Skool, 1983 CanLII 973 (Ont. LRB).
Rubber, Manufacturing, 2011 ONSC 1707; Cara Operations
31. Shaw-Almex Industries Limited, 1986 CanLII 1534 (Ont. v. HRCE & BU, Local No. 40, 2004 BCSC 1753; Canadian
LRB); see also the discussion in Ottawa Citizen, [1999] Pacific Rail Company v. Teamsters Canada Rail Conference,
OLRD No. 1445 (OLRB) (the employer who grants jobs to 2007 BCSC 2020; and Cascade Aerospace Inc. v. Unifor
replacement workers over locked-out workers in a job (Local 114), 2014 BCSC 1211.
posting based on job performance is not tainted by anti-
41. See Labour Law Casebook Group, supra note 1 at 418-22.
union animus).

42. D.C. Thomson and Co. Ltd. v. Deaking and Others, [1952] 2 54. See, for example, BC Labour Relations Code, supra note 8,
All ER 361 (CA); and Prince Rupert Grain Ltd. v. Grain s. 45(2); Alberta Labour Relations Code, supra note 28,
Workers’ Union, Local 333, 2002 BCCA 641. s. 147(3); and Canada Labour Code, supra note 24, s. 50(b).
43. Hersees of Woodstock Ltd. v. Goldstein et al., 1963 CanLII 55. See, for example, Ontario Labour Relations Act, supra note
151 (Ont. CA). 8, s. 40; Canada Labour Code, supra note 24, ss. 79(1),
44. See, for example, Ontario Labour Relations Act, supra note (2); and Alberta Labour Relations Code, supra note 28,
8, s. 83. s. 93. For a discussion of a voluntary interest arbitration
involving Air Canada and one of its unions, see D. Doorey,
45. Consolidated-Bathurst Packaging, [1982] 3 CLRBR 324.
“Explaining the Union’s Win in the Air Canada ‘Final
46. See, for example, Prince Rupert Grain Ltd. v. Grain Offer’ Arbitration,” online, Law of Work (blog): <http://
Workers’ Union, Local 333, supra note 42; Telus lawofwork.ca/?p=3842>. In some jurisdictions, the parties
Communications Inc. v. Telecommunications Workers may agree to be bound by recommendations of a concilia-
Union, 2005 ABQB 719; and Brookfield Properties v. Hoath tor or mediator rather than referring their dispute to an
et al., 2010 ONSC 6187. See also B. Adell, “Secondary interest arbitrator: see, for example, Manitoba Labour
Picketing After Pepsi: What’s Clear and What Isn’t?” Relations Act, supra note 13, s. 106; and Nova Scotia Trade
(2003) 10 CLELJ 135. In British Columbia, where picket- Union Act, supra note 13, s. 72.
ing is regulated primarily by the Labour Relations Code
56. See, for example, the Ontario Police Services Act, RSO
rather than common law torts, the code still renders most
1990, c. P-15; Ontario Fire Protection and Prevention Act,
secondary picketing unlawful: see BC Labour Relations
1997, SO 1997, c. 4; and Ontario Hospital Labour Disputes
Code, supra note 8, s. 65.
Arbitration Act, RSO 1990, c. H.14.
47. Courts of Justice Act, RSO 1990, c. C.43, s. 102. See also
57. See Toronto Transit Commission Labour Dispute Resolution
Cancoil Thermal Corp. v. Abbott, 2004 CanLII 2565 (Ont.
Act, 2011, SO 2011, c. 2 (banning strikes by all employees
Sup Ct J); and Aramark Canada Ltd. v. Keating, [2002] OJ
of the TTC); Protecting Air Service Act, SC 2012, c. 2
No. 3505 (Sup Ct J); but see also Industrial Hardwood
(banning strikes by employees of Air Canada); and Restor-
Products (1996) Ltd. v. International Wood and Allied
ing Mail Delivery for Canadians Act, SC 2011, c. 17
Workers of Canada, Local 2693, 2001 CanLII 24071 (Ont.
(banning strikes by employees of Canada Post).
CA); Ogden Entertainment Services v. United Steelworkers
of America, Local 440, 1998 CanLII 14755 (Ont. CA); 58. See, for example, Ambulance Services Collective Bargaining
Canada Post Corporation v. PSAC/UPCE Local 60100, 2009 Act, 2001, SO 2001, c. 10.
NBQB 38; Brookfield Properties v. Hoath et al., supra note 59. The Saskatchewan Public Service Essential Services Act, SS
46; and AirTime Express Inc. v. Teamsters Local Union No. 2008, c. P-42.2, restricted strikes by health care workers
419, supra note 33. and allowed the employer to unilaterally decide which
48. Cancoil Thermal Corp. v. Abbott, supra note 47. employees were essential. This legislation was struck down
as a violation of the Charter’s guarantee of freedom of
49. See, for example, Alberta Labour Relations Code, supra
association in Saskatchewan Federation of Labour v.
note 28, s. 69; and Ontario Labour Relations Act, supra
Saskatchewan, supra note 7.
note 8, s. 42.
60. See the discussion in Saskatchewan Federation of Labour v.
50. Employment and Social Development Canada, “Work
Saskatchewan, supra note 7.
Stoppages by Sector and Year,” online: <https://www
.canada.ca/en/employment-social-development/services/ 61. See, for example, Ontario v. Ontario Public Service Employ-
collective-bargaining-data/work-stoppages/work ees Union, 2002 CanLII 28309 (Ont. LRB).
-stoppages-year-sector.html>. 62. See, for example, York University Labour Disputes Resolu-
51. Humpty Dumpty Foods, [1977] 2 CLRBR 248 (Ont. LRB). tion Act, 2009, SO 2009, c. 1; and Restoring Mail Delivery
for Canadians Act, supra note 57.
52. Garda Security Screening Inc., 2011 CIRB 593; and Hilton
Villa Care Centre Ltd. v. Hospital Employees’ Union, 2012 63. See D. Doorey, “Canadian Government Slammed (Yet
CanLII 68311 (BCLRB). Again) by ILO for Back to Work Legislation in Canada Post
Dispute,” online, Law of Work (blog): <http://lawofwork
53. D. Doorey, “University of Windsor’s Latest Tactics Raise
.ca/?p=6463>. The International Labour Organization
Intriguing Legal Questions,” online, Law of Work (blog):
(ILO) has regularly ruled Canada’s back-to-work legislation
<http://lawofwork.ca/?p=7564>. See also DeVilbiss
to be in violation of ILO Convention 87, which (as noted in
(Canada Limited), [1976] OLRB Rep March 49; and
Chapter 27) guarantees a robust right to strike.
Caimaw v. Paccar of Canada Ltd., [1989] 2 SCR 983.

64. Saskatchewan Federation of Labour v. Saskatchewan, supra 68. Manitoba Labour Relations Act, supra note 13, s. 87 (access
note 7. For example, a Charter challenge has been is possible 90 days after certification and failed concilia-
launched against legislation prohibiting TTC workers from tion); and Quebec Labour Code, supra note 24, s. 93.1.
striking. 69. Ontario Labour Relations Act, supra note 8, s. 43. See, for
65. See S. Johnson, “First Contract Arbitration: Effects on Bar- example, United Food and Commercial Workers Canada,
gaining and Work Stoppages” (economic research paper, Local 175 v. Park Lane Chevrolet Cadillac, 2016 CanLII
Wilfrid Laurier University, 2008), online (pdf): <http:// 65529 (Ont. LRB). See also BC Labour Relations Code,
lcerpa.org/public/papers/LCERPA_2009-01.pdf>; supra note 8, s. 55; and Yarrow Lodge Ltd. (1993), 21
C. Riddell, “Labor Law and Reaching a First Collective CLRBR (2d) 1 (BCLRB).
Agreement: Evidence from a Quasi-Experimental Set of 70. Toronto Transit Commission Labour Disputes Resolution
Reforms in Ontario” (2013) 52:3 Indus Rel 702; and J. Act, supra note 57, s. 6.
Sexton, “First Contract Arbitration: A Canadian Inven-
71. Restoring Mail Delivery for Canadians Act, supra note 57,
tion” (1991) 1 Lab Arb YB 231.
s. 11(3).
66. Weiler, Reconcilable Differences, supra note 6 at 53.
67. For a review of each jurisdiction’s model, see Adams, Can-
adian Labour Law, supra note 20, part 3, s. 13(iii)(g).
APPENDIX
Timeline of Collective Bargaining Between the City of Toronto and

Canadian Union of Public Employees, Local 416, 2011 to 2012
In 2011, a tense round of collective bargaining began in the
city of Toronto. The previous round of bargaining had
resulted in a 40-day strike that stopped garbage collection
and other public services. This strike became a focal point
in the 2010 mayoral election that saw Rob Ford elected
mayor, replacing Mayor David Miller. One of Mayor Ford’s
campaign promises was that he would “contract out” the
collection of garbage to a lower-cost private company and
fire hundreds of the city’s employees currently employed as
garbage collectors. The collective agreement in effect in
2010 included a clause preventing contracting out of city
services that would result in the dismissal of any employee
with ten years or more of service. This language was an
obstacle to Mayor Ford’s promise to contract out garbage
collection and, therefore, amending that language became
the city’s primary bargaining objective.
The following is a blow-by-blow chronological account of the 2011 to 2012 round of collec-
tive bargaining between the City of Toronto and the Canadian Union of Public Employees
(CUPE), Local 416 as reported at the time on Professor David Doorey’s Law of Work blog.
1. Summer 2009: A 40-Day Strike

Unionized workers of the City of Toronto engage in a 40-day strike during the summer of 2009.
City Councillor Rob Ford is a vocal advocate during the strike for the Liberal government to

enact back-to-work legislation to end the work stoppage. The strike is eventually resolved with
an agreement giving the unionized workers a raise of between 1.75 and 2.25 percent over three
years. The new agreement expires on December 31, 2011. Language that has been in the collec-
tive agreement for decades limiting contracting out of public services if doing so will cause a
layoff of permanent workers remains in the agreement. That language reads as follows:
No permanent employee with ten (10) years of seniority shall lose his employment as a result of

contracting out or privatization. Employees affected as a result of contracting out shall have access
to the Redeployment provisions of Article 28 and the Layoff and Recall provisions of Article 29 …
The City confirms that during the term of this Collective Agreement and any extension by law,
there shall be no new contracting out of work of the Local 416 bargaining unit resulting directly or
indirectly in the layoff or loss of employment of permanent employees.
2. Spring/Summer 2010: The Mayoral Campaign

The mayoral campaign heats up, with most candidates, including Rob Ford, saying they will
contract out city services, especially garbage collection, if elected. Ford’s website claims that
contracting out will save the city “$20 million a year.” Also, he promises that if he is elected
mayor, “taxpayers can have the confidence their garbage collectors won’t go on unnecessary
strikes.”
3. October 25, 2010: Rob Ford Elected Mayor

Rob Ford is elected mayor of Toronto on a promise to “stop the gravy train” and contract out
city services, among other campaign pledges.
4. May 17, 2011: Council Vote

Toronto City Council votes 32 to 13 to contract out garbage collection west of Yonge Street
and consequently to fire some 300 city employees. Mayor Ford claims that savings from con-
tracting out this work will save the city $10 million per year. The city calculates the estimated
savings at $7 million per year, while other groups suggest the city is considerably inflating the
numbers.
5. October 4, 2011: Collective Bargaining Officially Begins to

Renew the Collective Agreement
The formal bargaining begins when one side serves the other with a “notice to bargain” letter
(see Chapter 33). The city serves this notice to the union on October 4. The city claims that its
priorities in bargaining are as follows:
• to obtain necessary improvements to modernize its collective agreements to ensure it has

the ability to effectively deliver its core services to the public
• to change costly and restrictive collective agreement provisions that hinder the effective
management of the city
• to achieve cost containment measures to be able to continue to provide its services in the
future
6. October to December 2011: Collective Bargaining

The parties engage in some largely unproductive bargaining sessions. No one expects the parties
to reach an early collective agreement given that the mayor and to a lesser degree his allies on
the employer’s Employee and Labour Relations Committee (ELRC) have staked their political

credibility on their promise to eliminate or amend the job security provisions in the collective
agreement to permit wide-scale contracting out of bargaining unit jobs.
7. December 1, 2011: City Council Rejects a Motion to

Require That the Full Council Approve a Lockout
Councillor John Filion files a motion at council that would require any decision by the city to
either lock out or unilaterally amend the existing terms and conditions of employment be
approved by the full council rather than just the small Employee and Labour Relations Commit-
tee, which comprises mostly Rob Ford supporters. The motion fails by a margin of 19 to 18. This
means that the ELRC has the power to lock out or alter terms of employment of bargaining unit
employees without having to take the issue to the full council. The motion foreshadows for the
first time that the city may be considering the possibility of unilaterally amending the terms of
the collective agreement once the lawful strike/lockout date is reached, a weapon available to the
employer (as discussed in Chapter 34) but hardly ever used by a government employer.
8. December 15, 2011: The City Requests That a Conciliation

Officer Be Appointed
In order to get to a legal strike or lockout position, government conciliation—an attempt by a
professional mediator assigned by the government to get the parties to a deal—must first be
exhausted, as explained in Chapter 34. The city requests on December 15 that the government
appoint a conciliation officer. The countdown to a legal strike/lockout date has now begun.
9. January 2012: Public Exchanges in the Media Are

Designed to Influence Public Opinion
In public sector collective bargaining, influencing public opinion is a normal part of the bar-
gaining strategy. Each side will claim that it has the public interest in mind and that the other
side is being unreasonable and putting those interests at risk. These media campaigns are pre-
dictable and largely vacuous, but they can influence public perceptions that in turn can influence
relative bargaining power. Throughout the early winter of 2012, both sides along with city politi-
cians engage in public accusations and commentary in the media.
10. January 12, 2012: The City Is Eager to Get to a Legal

Strike/Lockout Date
Less than one month after requesting a conciliation officer, the city now informs the minister of
labour that it believes bargaining is at an impasse. The next step is for the minister to issue a “no
board report” pursuant to section 79(2)(b) of the Ontario Labour Relations Act, 1995. A no
board report is a step in the process leading to a legal strike and lockout position that involves
the minister indicating that further conciliation, in the form of a conciliation board, will not be
ordered. In theory, the minister could elect more conciliation with a three-person board if that
could help get a deal, but that option is virtually never exercised. Seventeen days after the no
board report, the parties will be in position to lawfully strike or lockout, or the employer can
unilaterally impose its final offer that was put to the union.
11. January 13, 2012: Union Proposes a Zero Wage Increase

Package
The union proposes to settle the collective agreement by agreeing to a three-year wage freeze in
the new collective agreement. The union is hoping this strategy will put the city on the defensive.

No one can claim now the workers are being greedy. Zero percent is less than the national
average in the public or private sector, and less than the cost of living. Assuming that the union
would have bargained at least a cost-of-living raise, this saves the employer in the range of $10
million per year for the next three years. In normal circumstances, the employer would be able
to accept this offer, call it a win, and move on without a work stoppage for another three years.
But Mayor Ford has promised his supporters more. He promised he would fire some 7,000 out
of 50,000 city employees and replace them with workers employed by third-party contractors.
A wage freeze does not achieve this objective, because to contract out so many jobs, the city
needs revisions to the contracting-out provisions in the collective agreement.
12. January 16, 2012: National Post Doubts Whether the City
Can Persuade the Public of the Need for a Work Stoppage
National Post columnists, who are rarely supportive of unions, write that if the city rejects the
wage freeze offer put forward by the union, and a strike or lockout ensues, the public may turn
against the city.
13. January 16, 2012: City Counteroffers, Calls Union Wage

Freeze a “Ploy”
As expected, the city negotiators reject the union’s offer of a three-year wage freeze. The chair of
the employer’s bargaining committee, Councillor Doug Holyday (a Rob Ford ally), tells the
media that the offer is just a “ploy.” The city counteroffers with a “modest lump-sum payment”
and a concession: the complete removal of the no-contracting-out clause is taken off the table
in part. Here we have a situation where the employer is responding to a union offer to accept a
wage freeze by offering to pay a bonus.
The city says it would agree to keep the job security clause intact for workers with 25 years
or more of service. So we see movement. The old language protects “permanent employees with
10 years of seniority” from job loss caused by contracting out of their jobs. The city’s new pro-
posal would permit contracting out of bargaining unit jobs leading to the termination of any
employee with less than 25 years’ service. The city is attempting a classic divide-and-conquer
strategy, hoping that it can get sufficient support of employees with greater than 25 years’ service
to get its proposal ratified in a majority-rules ratification vote. It is counting on more senior
employees being willing to vote in their interests, even if it means junior employees will lose
their jobs.
14. January 18, 2012: No Board Report Is Issued,

and a Strike/Lockout Deadline Is Set
As expected, the minister issues a no board report, starting the countdown to a work stoppage.
According to the Labour Relations Act, 1995, the parties are in a legal strike and lockout position
17 days from now, putting the legal strike/lockout time as midnight on Sunday, February 5. This
is also the date on which the city could unilaterally change the terms of employment, such as by
cutting wages and benefits.
By way of recap on where the parties stand, the union has offered to roll over the terms of the
existing agreement for another three years with no increase in pay or benefits. The employer has
offered a lump-sum payment to workers and the abolition of the job security provisions for all
employees except those with greater than 25 years’ service.

15. January 19 to 30, 2012: Little News, Parties

Continue Talks
After the no board report is issued, things quiet down for a while. The union’s negotiator (Mark
Ferguson) tells the media that talks are continuing and that the tone of bargaining has changed
in a positive way:
“For the first time, the city was actually willing, and open, and engaging in the discussions that they
had with us. If this tone continues through the bargaining process, that is a very good thing,” Fergu-
son said, calling the shift “a major breakthrough.”
We are in the calm before the storm ahead of the February 5 deadline.
16. January 30, 2012: Work Stoppage Deadline Is Days Away,

Parties Continue to Bargain
There has been little word from the negotiators, other than the union’s spokesperson, who says
that talks are moving along. He also expresses unhappiness about the city’s unwillingness to
promise that it will not lock out workers once the lockout date (February 5) is reached. The city
is saying it will assess the situation at that time.
17. February 3, 2012: City Says It Will Unilaterally Alter

Conditions of Employment Starting Monday Morning
On February 3, as the deadline nears, the city tables what it called its “final offer” and publishes
a memo outlining its strategy. Nothing is new in terms of the proposals: the union offered to roll
over the agreement with a three-year wage freeze, and the city said it would rather give a small
pay raise to the employees who remain after they have fired hundreds of workers. Therefore, we
have the odd situation of an employer offering pay raises, and the union saying it does not
want them.
The more interesting clarification in the February 3 memo is the city’s plan to unilaterally
impose its final offer on employees once it is in a legal lockout position (Sunday at 12:01 a.m.).
Here is what the memo says:
Given the lack of a settlement and the distance between the parties, I have concluded, in consultation
with the City’s Executive Director of Human Resources, my Senior Management Team, the City
Solicitor’s Office, and our external legal counsel, that it would be inappropriate to delay the necessary
changes to the collective agreement if we are unable to negotiate a new agreement. To be clear, the
Labour Relations Act, 1995 provides the City of Toronto with the ability to implement new terms of
employment once the negotiations have broken down and after the 17-day No Board period has
expired. Based on those consultations, I have decided, if we do not reach a new agreement by the
deadline, that it would be appropriate and necessary to exercise this option.
As explained in Chapter 34, the law gives the employer the legal right to unilaterally impose
its final offer once the parties are in a legal strike and lockout position. This strategy has rarely,
if ever, been adopted by a government employer.
One reason why the strategy of imposing contract terms is rarely used by employers is that
unions and employees often have an obvious countermeasure: they can refuse the terms and
begin a strike. That strike can be a complete work stoppage, or it can be a coordinated work-to-
rule campaign, partial strike, or rotating strike in which different groups of workers walk off the
job at different times. The strategy of imposing contract terms only works if employees are

unprepared or unwilling to strike. In this case, though, the union had chosen the risky strategy
of not taking a strike vote, which is required in Ontario as a precondition to a lawful strike. It
did so because it wanted to demonstrate to the public that it had no intention of engaging in
another work stoppage, and perhaps also because it was not sure what the result of a strike vote
would be. In any event, having not taken a strike vote, the union had no weapon available to
resist the employer’s threat that it would impose its final offer.
18. February 5, 2012: Parties Announce Tentative Deal After

All-Night Bargaining
At the last moment, after an all-night bargaining session, the parties reach a tentative four-year
collective agreement (which still needed to be ratified by the workers). A Toronto Star article
published the next day under the headline “Strike Averted” described some of the early details.
Note how the headline inaccurately claims that a “strike” was averted, even though the union
had insisted from day one that it would not strike and in fact had not even taken the required
strike vote. Rather, what was averted was the employer unilaterally imposing its final offer. Pay
attention to how language is used in reporting on collective bargaining. For example, often the
media call a union proposal a “demand” and an employer proposal an “offer.” Does this language
suggest that the union is the aggressor in the negotiations? Is that an accurate description of this
round of bargaining?
A key change in the collective agreement language relates to contracting out. The new collec-
tive agreement permits the employer to contract out bargaining unit work provided that it does
not lead to the dismissal of city employees with 15 or more years’ seniority. The employer
opened bargaining by insisting on the removal of the clause prohibiting contracting out, then
later improved its offer by suggesting that the job security provisions apply only to workers with
more than 25 years’ service. In the final deal, the city came down to 15 years. In exchange for the
concession that would permit the employer to dismiss union members with less than 15 years’
service, the employees who will not lose their jobs will receive a 6 percent raise over the four
years.
19. February 13, 2012: Unionized Workers Ratify a New Four-

Year Agreement
Under our system of labour law, any deal reached by the union’s bargaining committee is subject
to ratification by the employees governed by the collective agreement. This requirement appears
in section 44 of the Labour Relations Act, 1995. CUPE held that vote on February 13 and
announced that the proposed agreement reached on February 5 had been ratified by a majority
of voters. Therefore, a new collective agreement would be in effect for four years, until December
31, 2015.
20. Post-Script: August 2012: Private Garbage Collection

Begins in Parts of Toronto
Once the new collective agreement language was in effect, the city quickly moved to contract
out garbage collection. The city decided to dismiss hundreds of its own employees and to con-
tract out their work to a private garbage disposal company in the western part of Toronto.

C H A P T E R 35
The Collective Agreement

II. The Legal Status of Collective Agreements 586
• Explain key differences between individual employment contracts and
III. Regulation of Collective Agreements 587
collective agreements.
A. Common Mandatory Collective Agreement Terms 587
• Identify and distinguish among mandatory, default, and prohibited B. Default Collective Agreement Terms 588
collective agreement terms. C. Prohibited Collective Agreement Terms 589
• Discuss and explain the three sources of collective agreement terms. IV. The Principle of “Reserved Management Rights” in Collective
• Explain the concept of reserved management rights. Agreement Interpretation 589
V. Sources of Collective Agreement Terms and Rules of
• Explain circumstances in which labour arbitrators imply an obligation
Interpretation 591
into collective agreements that employers act “reasonably” in the
A. Expressed Collective Agreement Terms 591
exercise of their discretion under collective agreements.
B. Implied Contract Terms 594
• Explain the importance of seniority and bumping rights in collective C. Ancillary Collective Agreement Terms 598
agreements. VI. Chapter Summary 600
Exercise 601
I. Introduction
The successful conclusion of collective bargaining is a collective agreement, which is a contract
between a union and an employer that governs working conditions of employees in jobs that fall
within the bargaining unit that the union is legally entitled to represent. As we learned in Chap-
ter 33, unions and employers are afforded considerable latitude in terms of the scope and con-
tent of the collective agreements they negotiate. This freedom should not be confused with
government indifference to the substance of collective agreements. In fact, governments inject
public policy concerns into collective agreements through various legislative mechanisms dis-
cussed in this chapter. In addition, labour arbitrators have played a significant role in giving
meaning to collective agreement language. A vast body of labour arbitration case law spanning
more than half a century functions in a similar manner to the common law of the individual
employment contract. In this chapter, we introduce some important rules of collective agree-
ment interpretation that have played an important role in shaping the rights and duties of
unions and unionized employers and employees.
585

II. The Legal Status of Collective Agreements

Before collective bargaining legislation was enacted in Canada in the mid-20th century, a col-
lective agreement between a union and an employer could not be enforced in the courts because,
legally speaking, it did not exist. That’s because unions did not exist as legal entities—they were
considered voluntary associations, like a book club—and therefore a union could not enter into
a binding contract. Moreover, since the parties to collective agreements were employers and
unions, individual employees were not able to sue for breach of a collective agreement in their
own right.1 However, this lack of legal status did not render collective agreements meaningless
in the common law regime. Sometimes collective agreement terms were incorporated into indi-
vidual employment contracts, so the terms became enforceable in that manner. The agreements
also created workplace norms (see Chapter 2) that influenced workplace behaviour, and a vio-
lation of a collective agreement by the employer would sometimes provoke a strike by aggrieved
workers.
It was not until the mid-1940s that Canadian law developed a statutory collective bargaining
model that gave legal force to collective agreements. PC 1003 (1944) (see Chapter 29), defined
a collective agreement as “an agreement in writing between an employer or an employers’ or-
ganization and a trade union or an employees’ organization on the other hand containing provi-
sions with reference to rates of pay, hours of work or other working conditions” and provided
that collective agreements were binding on employers, unions, and the employees covered by
the agreement.2 Similar provisions exist in modern collective bargaining statutes across Canada
that render collective agreements legally binding contracts.3 PC 1003 also required that collec-
tive agreements include a dispute resolution procedure to deal with any allegations that the
collective agreement has been violated without a work stoppage (the mandatory “no strike or
lockout” clause) and other rules relating to the content of collective agreements that exist to
this day.4
Most of the common law employment contract doctrines we considered in Part III—includ-
ing repudiation of contract, wrongful dismissal, constructive dismissal, and summary dis-
missal—do not apply to collective agreements. This much was made clear in the 1975 Supreme
Court of Canada case of McGavin Toastmaster Ltd. v. Ainscough.5 In that case, unionized
employees engaged in an illegal strike and the employer responded by closing the factory. The
union, on behalf of the employees, claimed severance pay as required by the collective agree-
ment. The employer argued that the employees were not entitled to severance pay because they
had quit by “repudiating” the contract (explained in Chapter 13). The Supreme Court ruled that
the common law concept of repudiation of contract did not apply in the collective bargaining
regime:
The common law as it applies to individual employment contracts is no longer relevant to employer-
employee relations governed by a collective agreement which, as the one involved here, deals with
discharge, termination of employment, severance pay and a host of other matters that have been
negotiated between union and company.6
The legal rules that govern collective agreements sometimes borrow from common law con-
cepts and reasoning, but they comprise a distinct legal regime that we will explore over the next
few chapters.
workplace norms: Norms or expectations that arise in a workplace as a result of past practices or relationships that can
influence behaviour at work, even though they are not codified in contracts or statutes.

Chapter 35 The Collective Agreement 587
III. Regulation of Collective Agreements

Governments regulate the content of collective agreements in a variety of ways. We will consider
three: (1) mandatory terms, (2) default terms, and (3) prohibited terms.
A. Common Mandatory Collective Agreement Terms

Canadian collective bargaining law (Chapter 33) generally grants unions and employers wide
discretion to determine the content of collective agreements, but that discretion is not un-
limited. Some terms are required by statutes to be included in all collective agreements (manda-
tory collective agreement terms). Table 35.1 describes some common mandatory collective
agreement terms found in Canadian statutes, although other terms are required by some but not
other jurisdictions.7 A union recognition clause is needed to clarify which employees the col-
lective agreement covers. It takes the same form as the bargaining unit description we consid-
ered in Chapter 31. In fact, the description in the certification issued by the labour relations
board that initially grants the union bargaining rights will often just be transposed into the
collective agreement and become the recognition clause.
TABLE 35.1 Mandatory Collective Agreement Terms

Collective Agreement Term
Required by Statute What the Term Does
Union recognition clause Describes the bargaining unit that the collective agreement covers
No strike or lockout clause Prohibits strikes and lockouts during the term of the collective agreement
Mandatory arbitration clause Requires that all disputes arising during the collective agreement over the
interpretation, application, or enforcement of the agreement be referred to
binding labour arbitration
Mandatory union security (only in Manitoba) Requires that the employer deduct union dues from the wages of all bargaining
clause unit employees and remit this amount to the union
Mandatory “just cause” for discipline or dismissal Requires a clause providing that the employer must have “just cause” to
clause (only in British Columbia and Manitoba) discipline or terminate the employment contract of bargaining unit employees
The prohibition on strikes and lockouts during a collective agreement, a distinctive feature
of the Canadian collective bargaining model since 1944, is implemented by a “no strike or lock-
out clause” that is required by statute to be included in every Canadian collective agreement.8
Labour arbitrators can order damages for breach of these clauses caused by a mid-contract strike
or lockout. Since mid-contract disputes cannot be settled by strikes or lockouts, an alternative
dispute resolution model is needed. The model chosen by Canadian governments was labour
arbitration, so every collective bargaining statute in Canada also requires that collective agree-
ments include a clause requiring that disputes relating to the application, interpretation, and
enforcement of the agreement be referred to binding labour arbitration.9 This requirement takes
collective agreement disputes out of the courts and into the special world of labour arbitration,
which we explore over the next two chapters.
mandatory collective agreement term: A term required by statute to be included in every collective agreement. If no such
term is included, the statute reads a term into the agreement.
union recognition clause: A clause in a collective agreement that defines the scope of the jobs that are covered by the
agreement.
labour arbitration: A binding dispute resolution process used to resolve disputes involving alleged breaches of collective
agreements.

Some provinces require by statute the inclusion of terms that are usually bargained into col-
lective agreements anyway, to avoid bargaining impasses and conflict over these issues. For ex-
ample, in Manitoba, the Labour Relations Act requires that all collective agreements include a
union dues check-off clause.10 Other jurisdictions include a “default” union dues clause provi-
sion, as explained below. The BC and Manitoba labour relations statutes require collective agree-
ments to include a just cause provision, which requires employers to have a valid reason to
discipline or dismiss employees (see Chapter 36). Other jurisdictions do not require just cause
provisions, but unions and employers nevertheless almost always agree to include them in the
collective agreement anyway.
B. Default Collective Agreement Terms

A default contract clause is one that is read into a contract, unless the parties agree otherwise,
or that is read in provided that one party insists on its inclusion.11 An important example found
in many Canadian collective bargaining statutes relates to union dues clauses. In Chapter 29, we
considered the famous case of Ford Motor Company v. United Automobile Workers Union (see
Box 29.3) that involved the resolution of a bargaining dispute about the union security clause to
be included in a collective agreement. The union proposed a clause requiring both mandatory
union membership and union dues check-off, whereas the employer wanted neither. Justice Ivan
Rand was appointed to resolve the dispute and decided in favour of a clause that required man-
datory union dues check-off, since all employees benefit from the collective agreement, but not
mandatory union membership.12 That trade-off became known as the “Rand Formula.”
The Rand Formula is supported (indirectly) in Ontario, Newfoundland and Labrador, and
the federal jurisdiction by legislation that creates a default union dues check-off clause.13 For
example, consider the provision in section 47(1) of the Ontario Labour Relations Act, 1995:
where a trade union that is the bargaining agent for employees in a bargaining unit so requests, there
shall be included in the collective agreement between the trade union and the employer of the
employees a provision requiring the employer to deduct from the wages of each employee in the unit
affected by the collective agreement, whether or not the employee is a member of the union, the
amount of the regular union dues and to remit the amount to the trade union, forthwith.14
This section effectively grants the union the right to decide whether it wants a union dues
check-off clause to be included. The employer can attempt to bargain something different, but
it is unlawful for it to insist on language other than that found in the default statutory language
if the union wants the clause included.15 Although unions obviously prefer an automatic union
dues check-off model of the type required in the default clause, if the bargaining unit employees
did not want automatic union dues deduction or they want a clause requiring employees to per-
sonally authorize dues deduction (which is a requirement in several provinces),16 then they
could instruct their union to bargain accordingly. This flexibility about what type of union dues
clause is permitted is available because the statute does not impose a specific union dues check-
off clause; instead, it creates a default clause that must be included if the union insists. The pur-
pose is to avoid industrial conflict about union dues check-offs of the sort that led to the historic
Ford Motor Company dispute.
union dues check-off: A “union security” clause whereby all members of a bargaining unit must pay union dues and employers
must “check off” these dues from workers’ wages and remit them to the union.
just cause provision: A term in a collective agreement between a union and an employer that requires that the employer
demonstrate “just cause,” or a good business reason, to discipline or dismiss an employee.
default contract clause: A term that must be included in a contract (including a collective agreement) unless the contracting
parties agree otherwise.

Another default clause provision found in Canadian collective bargaining legislation deals
with the minimum length of collective agreements. In the common law regime, an employer and
employee can agree to any length of fixed-term contract, or more frequently they agree to an
indefinite-term contract of no predetermined length. There is less discretion in the collective
bargaining regime. Governments want a minimum period of peace in a unionized workplace
during which there can be no work stoppages. Therefore, since it is unlawful to strike or lockout
during a collective agreement, all jurisdictions impose a minimum collective agreement term of
at least one year from the date the agreement commences.17 The parties can agree to a term that
is longer than one year, but if they agree to less than one year, or do not include a duration clause
at all, the statutes read in a one-year term.18 Collective bargaining laws require a defined end
date so employees can identify the “open periods” during which applications to displace existing
unions (union raid) or to decertify the union (see Chapter 37) can be filed. As discussed in
Chapter 31, an open period usually commences during the final few months of a collective
agreement.
C. Prohibited Collective Agreement Terms

Some types of collective agreement terms are prohibited altogether by collective bargaining or
other statutes. An obvious example is terms that violate statutes, such as human rights, employ-
ment standards, or criminal law statutes.19 Unions and employers are not exempt from the
general public laws that apply to everyone else.
IV. The Principle of “Reserved Management Rights” in Collective

Agreement Interpretation
Collective agreements usually contain much greater written detail than individual (non-union)
employment contracts. I have a collective agreement on my shelf between Stelco Steel Company
in Hamilton and the United Steelworkers Union that is 373 pages! There are a number of reasons
why collective agreements have so much more detail than individual employment contracts.
First, unions employ professional negotiators trained and experienced in the art of negotiating
collective agreements that prioritize employee interests. Second, unions usually negotiate from
a position of greater bargaining strength than individual employees in the non-union setting.
That power derives from the threat of a collective work stoppage (see Chapter 34) or at least
collective non-cooperation. Consequently, it is much more difficult for a unionized employer to
impose its will and unilaterally set collective agreement terms than a non-union employer.
Third, labour arbitrators long ago adopted a principle known as reserved management rights
(sometimes called residual management rights), which encourages unions to bargain extensive
contract language that expressly restricts managerial authority.
Reserved management rights is a principle of collective agreement interpretation applied by
labour arbitrators. It is not written in a statute. The principle holds that unionized employers
generally retain the rights enjoyed by non-union employers to run the enterprise as they like,
subject only to statutory and contractual restrictions found in the collective agreement. Until
the 1960s, there was a lively debate among labour arbitrators over reserved management rights.
Some arbitrators, including University of Toronto law professor Bora Laskin, a future chief
justice of the Supreme Court of Canada, believed that arbitrators should not be influenced by
rules from the common law regime when they are interpreting collective agreements. Laskin
explained this position in a 1953 decision called Peterboro Lock Mfg. Co. Ltd. as follows:
reserved management rights: An interpretive principle applied in labour arbitration that presumes that unionized employers
retain the basic rights to run their business as they deem fit, subject to any statutory or contractual restrictions bargained by the
union. These rights are sometimes called residual management rights.

The introduction of a collective bargaining regime involves the acceptance by the parties of assump-
tions which are entirely alien to an era of individual bargaining. Hence, any attempt to measure rights
and duties in employer-employee relations by reference to pre-collective bargaining standards is an
attempt to re-enter a world which has ceased to exist.20
In the Peterboro Lock case, the employer argued that absent collective agreement language
limiting its right to unilaterally change how employees were paid (hourly rate or piece rate), it
fell within presumed managerial prerogative to decide. Laskin rejected that argument, finding
that the agreement did not grant the employer the unilateral right to decide on a “whim” how
employees are paid. The “Laskin approach” required the employer to negotiate managerial pre-
rogatives with the union rather than simply inherit them from arbitrators through the concept
of reserved management rights. It was against this background that the famous arbitration case
discussed in Box 35.1 came before Professor Harry Arthurs, Bora Laskin’s former student who
would later become dean of Osgoode Hall Law School and president of York University, who
was acting as labour arbitrator.

Reserved Management Rights in the Collective Bargaining Regime
U.S.W.A. v. Russel Steel Ltd.
(1966), 17 LAC 253 (Arbitrator Arthurs)
Key Facts: Russel Steel decided that it no longer wanted to

employ its own truck drivers for hauling services, so it con-
tracted with another company to provide trucks and drivers
to perform these services. This is known as contracting out
bargaining unit work. The employer’s former truck drivers were
offered a lower-paying job in the warehouse. The union filed
a grievance and argued that the collective agreement did not
confer on the employer the unilateral right to contract out
work normally done by bargaining unit employees. The em-
ployer argued that absent a specific restriction on its right to
contract out work, it retained that right by virtue of having the
reserved right to manage the enterprise.
Issue: Did the employer violate the collective agreement by Professor Harry Arthurs is a leading Canadian
contracting out the truck driver work? scholar of work law.
Decision: No. Arthurs dismissed the union’s grievance. He
noted that the case provided a classic example of “contracting to adopt the reserved management rights approach than the
out” and engaged directly the ongoing “controversy” over the “Laskin approach” and thus more likely to find that the em-
reserved management rights approach in labour arbitration. ployer can contract out work, absent a clause saying that it
In his view, whatever the merits of the two sides of the debate, cannot. Arthurs wrote:
the collective agreement before him was negotiated within a
“climate” of collective bargaining. At the time the parties bar- The wide notoriety given to labour’s protests
gained the collective agreement, that climate included a clear against [contracting out], the almost equally wide
preference by Canadian arbitrators for the reserved rights notoriety, especially amongst experienced labour
approach to collective agreement interpretation. Therefore, and management representatives, of the over-
the parties must have known that an arbitrator was more likely whelming trend of decisions, must mean that there
contracting out: A practice whereby an employer contracts work formerly performed by its own employees to a third-party
business.

was known to these parties at the time they nego- ute intentions and undertakings to them today,
tiated the collective agreement the strong proba- when they are aware, as a practical matter, of the
bility that an arbitrator would not find any implicit need to specifically prohibit contracting out if they
limitation on management’s right to contract out. are to persuade an arbitrator of their intention to
It was one thing to imply such a limitation in the do so.
early years of this controversy when one could not
speak with any clear certainty about the expecta- In this case, the collective agreement included no restric-
tions of the parties; then, one might impose upon tion on the right of the employer to contract out the trucking
them the objective implications of the language of jobs. Therefore, the employer had the right to do so, and the
the agreement. It is quite another thing to attrib- grievance was dismissed.
The Russel Steel decision concerned a very particular set of facts, but it became the leading
authority for the reserved management rights approach to collective agreement interpretation
and to this day is regularly cited in arbitration decisions. Reserved management rights operate
similarly to implied terms in the common law regime (Chapter 9)—they confer a default distri-
bution of contractual rights in favour of the employer that is subject to restrictions bargained
into the collective agreement. The practical effect of reserved management rights is that unions
seek to bargain extensive collective agreement language that restricts the employer’s discretion
to make unilateral decisions affecting bargaining unit employees.21 For example, if a union
wants to ensure that its members will not lose their jobs due to the employer contracting out
work to a third party, it needs to negotiate a restriction on the employer’s right to contract out
bargaining unit work.22 This example helps explain why collective agreements are sometimes so
extensive and complex.
V. Sources of Collective Agreement Terms and Rules of

Interpretation
There are three potential sources of collective agreement terms: (1) expressed contract terms
(oral or written); (2) implied contract terms; and (3) ancillary contract terms. These sources
should sound familiar, because they align perfectly with the sources of contract terms in the
common law model considered in Chapters 8 and 9.
A. Expressed Collective Agreement Terms

As in the case of individual (non-union) employment contracts, the range of expressed, nego-
tiated collective agreement language is limited only by statute and the creativity and interests
of the parties. However, a number of standard types of provisions tend to appear regularly in
Canadian collective agreements. A sample collective agreement is included as an appendix
to this chapter. In addition to the mandatory collective agreement terms discussed above,
most Canadian collective agreements include terms that address the areas identified in
Table 35.2.
Some important differences exist between collective agreements and individual (non-union)
employment contracts that are worth emphasizing. The most obvious difference is that collec-
tive agreements usually include a just cause provision requiring the employer to have a good
reason to discipline or dismiss an employee, and there is no implied contractual term granting
employers the right to dismiss employees simply by providing them with notice, as in the com-
mon law regime (see Chapter 10). Therefore, collective agreements usually provide unionized
employees much greater job security than do individual employment contracts. Chapter 36 will
examine just cause provisions in detail.

TABLE 35.2 Common Collective Agreement Terms

Type of Collective Agreement Term What the Term Does
Management rights clause Lists subjects over which the employer has discretion and authority to make decisions
about the operation of the enterprise, subject to any restrictions appearing elsewhere
in the collective agreement
Union security clause Explains whether employees are required to become union members and/or pay
union dues, and the process by which union dues are to be collected from employees
Grievance procedure clause Describes the procedure and rules governing the filing and processing of grievances
filed by employees, the union, or employer
Seniority clause Explains how “seniority” will be calculated and what rights, entitlements, and
obligations are associated with seniority
Job rights clause Explains the rules for deciding which employees receive promotions, transfers, layoffs,
and recalls
“Just cause” clause Requires that the employer have “just cause” to discipline or dismiss a bargaining unit
employee
Hours of work and overtime clause Explains regular hours of work and any rules governing changes to those hours and
the assignment and pay required for overtime
Wages, benefits, and leaves (e.g., insurance Describe the rates of pay and other benefits coverage and leave entitlements for
coverage, vacations, bereavement and employees
other leaves, pensions) clauses
Duration clause Defines the term (beginning and end) of the collective agreement
Another difference is the importance of seniority in the collective bargaining regime.23

Seniority refers to the length of time that an employee has been employed by the employer, al-
though precise definitions vary from one agreement to the next. For example, seniority might
be measured simply from the date of hire, or it might be defined as the length of time employed
in the bargaining unit or in a particular department or division of the employer. Collective
agreements might also explain what happens to an employee’s seniority when the person tem-
porarily leaves the bargaining unit, such as to take a leave or a temporary assignment outside of
the agreement.24 Many rights or entitlements in collective agreements are tied to seniority. For
example, more senior employees may be paid at a higher rate, receive greater vacation entitle-
ments, have first access to overtime opportunities, or be given preferential treatment in the event
of promotions,25 transfers, layoffs, and recall from layoffs.26 Disputes about the application of
seniority clauses have led to reams of labour arbitration case law over the years.27
Probably the most important application of seniority involves job rights when employers
decide to downsize the workforce. Most Canadian collective agreements include some form of
bumping rights that permit senior employees to “bump” junior employees if temporary or
permanent layoffs take place.28 This entitlement to bump is usually not absolute. Most collective
agreements include a requirement that the senior employee possess the skills and ability to
perform the job that they are seeking to bump into, perhaps with some training. Some agree-
ments go further and require the bumping employee to possess superior skills to the incumbent
they are seeking to bump, or to be “relatively equal” to the incumbent in terms of skills or per-
seniority: A measure of an employee’s length of service with an employer.

bumping rights: An entitlement found in the terms of a collective agreement that permits a more senior employee to displace
a junior employee in the case of a temporary or permanent downsizing of the workforce.

formance. The specific language used is obviously important. A collective agreement right to
bump in the event of layoffs can trigger a complex chain of bumping down through an
organization.
A particularly thorny issue relates to the intersection of seniority rights in collective agreements
and the duty to accommodate requirement under human rights legislation (see Chapter 23).29
This issue brings into tension the regulatory regime (human rights statutes) and the collective
bargaining regime. The decision in Box 35.2 considers this tension.

The Intersection of Collective Agreement Seniority Rights and the Duty to Accommodate
Chatham-Kent Children’s Services v. OPSEU, Local 148 employees seeking accommodation and the interests of em-
(2014), 251 LAC (4th) 313 (Arbitrator Sheehan) ployers, unions, and other employees. The arbitrator summar-
ized this balancing test as follows:
Key Facts: Chatham-Kent Children’s Services decided to shut
its residential group homes and, as a result, an employee [The] relevant test in assessing whether a proposed
(Elley) was given a notice of layoff. The collective agreement accommodation measure(s) constitutes undue
permitted senior employees to “bump” junior employees in hardship is whether the impact of such a measure(s)
case of a layoff, provided that the senior employee possessed results in a significant interference with the normal
the required “skill, ability, and qualifications” for the position operation of the collective agreement, and the rights
in which she sought to bump. Elley advised the employer of employees under that collective agreement. While
that she wanted to bump into the volunteer coordinator it is clear that the union and other employees may
position. Elley possessed the necessary qualifications to per- have to “shoulder some of the hardship to facilitate
form that position. However, the junior employee (Bowen) accommodation,” if the interference with the em-
who held that position at the time suffered from a disability ployees’ collective agreement rights is significant,
that affected her vision and, as a result, would likely have no then the proposed accommodation measure will be
position that she could bump into herself if she were dis- viewed as constituting undue hardship for the other
placed from the volunteer coordinator position. Bowen employees. [Emphasis added]
sought to remain in the volunteer coordinator position as a
form of accommodation of her disability. The employer and In this case, if Elley was not able to bump into the volunteer
union agreed to refer the dispute to a mediator-arbitrator to coordinator position, her only option would have been to
resolve the dispute. bump into a lower classification that would result in an annual
pay cut of nearly $9,000. That constituted a “significant interfer-
Issue: Does the collective agreement entitle Elley to bump ence” with her collective agreement rights amounting to un-
Bowen from the volunteer coordinator position even if Bow- due hardship. Therefore, Elley was entitled to exercise her
en’s disability may prevent her from bumping into any other collective agreement seniority rights to bump into the volun-
position? teer coordinator position, even though that could have re-
sulted in Bowen being laid off.
Decision: Yes. The Supreme Court of Canada ruled in a deci-
sion called Central Okanagan School District No. 23 v. Renaud*
(discussed in Chapter 23) that the duty to accommodate in * Central Okanagan School District No. 23 v. Renaud, [1992] 2 SCR 970.
human rights legislation requires a balancing of the right of
Collective agreements define precisely what wages and benefits employees are to receive, and
the employer usually has no discretion to veer from those amounts. This is another important
difference between the collective bargaining and common law regimes. A non-union employer
is usually within its contractual rights to give an employee a raise, introduce new benefits, or
reward a hard-working employee with a bonus. Unions usually bargain restrictions on the right
of employers to unilaterally decide who gets raises and bonuses. In fact, a central objective of
unions in collective bargaining is often to remove employer discretion in important decisions
about wages, benefits, and job entitlements and to replace it with objective standards, such as

the application of fixed wage scales and the allotment of other entitlements by seniority. An em-
ployer who tries to give an individual employee a special payment not mentioned in the agree-
ment will almost certainly be met with a grievance alleging a collective agreement breach.
B. Implied Contract Terms

In Chapter 9, we discussed the origins and development of implied terms in the common law
regime, including the tests judges apply when deciding whether a term should be implied. In an
example of application of the internal feedback loop discussed in Chapter 2, labour arbitrators
have learned from the common law regime and applied the same or similar tests to justify the
implication of implied collective agreement terms. So, for example, some arbitrators have
applied the business efficacy test and the officious bystander test when asked to imply contract
terms.30 Some important implied collective agreement terms are listed in Table 35.3 and dis-
cussed below.
TABLE 35.3 Significant Implied Terms of Collective Agreements

Implied obligation on all parties to a collective agreement to administer the contract honestly and in good
faith.
Implied obligation on employees to avoid negligent work.
Implied obligation on unions to take prompt action to bring an end to unlawful “wildcat” strikes.
Implied obligation on employers to avoid harassment of employees.
Implied obligation on employers to exercise managerial discretion in a “reasonable” manner.
Implied obligation on employers to not implement “unreasonable” rules that the union has not agreed to and
the violation of which can lead to employee discipline (the KVP test).
The arbitration decision described in Box 35.3 considers whether an implied term exists in
the collective agreement that requires managers to avoid harassment of employees.31 Such an
implied term parallels the implied obligation recognized by common law judges on employers
to treat employees with civility and decency and in “good faith,” which we discussed in Chapter 9.32
Other implied terms recognized in the common law regime have also been recognized by labour
arbitrators when interpreting collective agreements. An example is the implied obligation for
employees to avoid negligent work.33 On the other hand, important terms implied into indi-
vidual (non-union) employment contracts by common law judges, such as the implied obliga-
tion to provide “reasonable notice” of termination, have no parallel in the collective bargaining
regime. Moreover, some implied terms recognized by labour arbitrators have no equivalent in
individual employment contracts, such as the implied obligation imposed on unions to take
prompt actions to end illegal strikes.34
business efficacy test: An approach used by common law judges to justify the implication of a contract term on the basis
that the term is necessary to make the contract effective.
officious bystander test: An approach used by common law judges to justify the implication of a contract term based on the
presumed intention of the parties. The idea is that a contract term is implied if it would be obvious to an uninterested bystander
that both parties intended the term to be part of the contract.


Implied Duty of Fairness or Reasonableness in Exercising Management Rights
Toronto Transit Commission v. Amalgamated Transit even absent an express provision referring to man-
Union agerial abuse or harassment, and apart from the
2004 CanLII 55086 (Ont. LA) (Arbitrator Shime) management rights provision, I determine it is an
implied term of the collective agreement that the
Key Facts: An employee (the grievor) filed a grievance against work of a supervisor must be exercised in a non-
the Toronto Transit Commission alleging that a supervisor abusive, non-harassing manner.
engaged in harassment of the grievor over several years and
that the employer failed to take reasonable steps to bring the In addition to this general implied term, the arbitrator also
harassment to an end. The grievor required medical care for referred specifically to collective agreement language that
anxiety and depression caused by the harassment and related required protection of employees’ “safety.” The use of that
workplace stress, which resulted in periods of absence from word became the basis for implying an obligation on the em-
work on sick leave. The employer argued that the harassment ployer to exercise its management rights in a manner that
did not occur. It also objected to the jurisdiction of the arbi- protects the physical and psychological safety of employees.
trator to hear the grievance on the basis that the union had The employer’s representative (the supervisor) violated these
not identified a collective agreement term that had been vio- implied terms, and the employer failed to bring the harass-
lated, since the agreement did not include a “no harassment” ment to an end when informed of it by the grievor and the
clause. union. A variety of remedial orders were made by the arbitra-
Issue: Did the employer violate the collective agreement by tor, including orders that the employer (1) reimburse the
allowing one of its supervisors to engage in prolonged harass- grievor for the difference in his normal pay and the lower
ment of an employee? amount he received while on sick leave due to the harassment,
(2) pay $25,000 to the grievor for “general damages,” (3) hence-
Decision: Yes. Although the collective agreement did not con- forth ensure that the harassing supervisor had no contact with
tain an expressed “no harassment” clause, the arbitrator ruled the grievor at work, and (4) implement a harassment policy
that an implied term required that management exercise its and ensure all managers complete anti-harassment training.
authority in a manner that avoids harassment of employees:
A long-standing debate involves the question of whether collective agreements include an

implied obligation for employers to exercise their managerial authority “reasonably.” If so, then
unions can challenge virtually any decision employers make as being “unreasonable,” which is
a rather vague standard. In Manitoba, the Labour Relations Act expressly reads into every col-
lective agreement a provision requiring the employer, “in administering the collective agree-
ment, to act reasonably, fairly, in good faith, and in a manner consistent with the collective
agreement as a whole.”35 Some collective agreements similarly include an expressed term requir-
ing employers to exercise their discretion in a reasonable manner.36 When such a clause exists,
an employee or union could file a grievance challenging an employer action as “unreasonable.”
For example, an arbitrator applied a reasonableness clause in striking down a rule imposed
unilaterally by the car rental company Thrifty Canada banning facial jewellery and earrings
worn by male employees. Thrifty was unable to demonstrate sufficient business justification for
the rule.37
However, in most circumstances in Canada, neither a statute nor expressed collective agree-
ment language imposes a general duty on employers to exercise their management rights “rea-
sonably.” Therefore, unions have frequently argued that arbitrators should imply a general
requirement for employers to act “reasonably” in a unionized workplace.38 In 2014, the Supreme
Court of Canada ruled in a case called Bhasin v. Hrynew that there is a general obligation on all
parties to contracts (including collective agreements) to perform the contract honestly and in
good faith.39 The full extent of what this means for collective agreement interpretation remains

to be seen, but it does seem clear that an arbitrator can consider whether the actions of employ-
ers and unions in implementing a collective agreement are dishonest or in bad faith, even if
there is no expressed contractual term that requires reasonableness, honesty, and good faith. In
a recent decision, a leading arbitrator recently summarized the state of the law on the issue of
whether there exists an implied obligation on employers to exercise managerial discretion “rea-
sonably” as follows:
While this Collective Agreement does not contain any explicit reference to reasonableness, arbitra-
tors have to infer that the parties negotiated the concept of reasonableness into the terms of their
collective agreement. To interpret a collective agreement any other way would be to infer that man-
agement has retained a right to be unreasonable. That does not make labour relations sense
anymore.40
Even before the decision in Bhasin v. Hrynew, Canadian arbitrators had required employers
to exercise discretion conferred on them by the collective agreement, such as in a “management
rights” clause, in a manner that was reasonable and not discriminatory, arbitrary, or in bad
faith.41 So, for example, where a collective agreement conferred a discretion on the employer to
determine the conditions under which employees would be reimbursed for work-related travel,
the arbitrator ruled that discretion was subject to an implied standard of “reasonableness.” The
employer’s condition that workers carpool and share hotel rooms was found to be an unreason-
able exercise of managerial discretion.42
Also, arbitrators have long implied a requirement for unilaterally imposed company rules
that can lead to employee discipline to be “reasonable.”43 The leading case on this point is an old
arbitration award from 1965, Re Lumber and Sawmill Workers’ Union, Local 2537 v. KVP Co.
Ltd., and the test applied to measure the legality of rules unilaterally introduced by employers is
to this day referred to as the “KVP test.”44 That test was described in the KVP arbitration award
as follows:
A rule unilaterally introduced by the company, and not subsequently agreed to by the union, must
satisfy the following requisites:
1. It must not be inconsistent with the collective agreement.

2. It must not be unreasonable.
3. It must be clear and unequivocal.
4. It must be brought to the attention of the employee affected before the company can act on it.
5. The employee concerned must have been notified that a breach of such rule could result in his
discharge if the rule is used as a foundation for discharge.
6. Such rule should have been consistently enforced by the company from the time it was
introduced.45
A new company rule that could lead to employee discipline and that fails to satisfy any one
of these requirements may be found by an arbitrator to be unenforceable, although most deci-
sions come down to an analysis of whether the rules are “reasonable.” In determining that issue,
arbitrators require that the employer demonstrate that the rule in question addresses a legit-
imate business interest, such as a serious health and safety concern, or some other significant
business interest. Hundreds of arbitration decisions consider whether a company rule is “rea-
sonable” applying the KVP test.46 For example, the introduction of workplace surveillance sys-
tems such as cameras, personal searches, and biometric scanning have sometimes been struck
down where the employer has been unable to demonstrate that a serious threat of theft or other
wrongdoing exists necessitating the infringement on employee privacy, as considered in
Box 35.4.47 Similarly, dress code and appearance rules unilaterally imposed by an employer must
address a pressing business concern or they will be struck down as unreasonable.48


Is the Installation of Surveillance Cameras “Unreasonable”?
Woodstock (City) v. Woodstock Professional Firefighters’ Decision: Yes. The arbitrator ruled that the employer’s decision
Association to install workplace surveillance cameras must meet a stan-
2015 CanLII 20641 (Ont. LA) dard of “reasonableness.” The only way an employee could
avoid working under surveillance is to not report to work,
Key Facts: The employer installed several surveillance cam- which would result in discipline or dismissal. Any rule (includ-
eras at two fire stations. The employer alleged it had done so ing a rule to work under surveillance) that can result in disci-
as part of a city-wide plan to better protect employees and pline must be “reasonable.” In assessing whether the cameras
the public from risks of harassment and violence. There had were “reasonable,” the arbitrator must consider (1) whether
been no specific complaints or security issues that had arisen there was a reasonable basis to install the cameras and (2)
at the fire stations, but the fire chief believed he should follow whether the surveillance itself was reasonable. This process
the city plan of installing cameras. There was no live mon- requires a balancing of employee’s privacy concerns and the
itoring of the cameras, and footage was overridden after employer’s interests that explain the cameras.
about 30 days. The cameras were pointed at the bay floor Here, the cameras directed at the “bay floor” where em-
area of the stations where employees work as well as inside ployees work were defended as necessary to ensure there are
the fire station in designated hallways. The union filed a no intruders entering the station. The arbitrator ruled that was
grievance arguing that the installation of the cameras was an not a sufficient justification for the cameras since the employer
unreasonable exercise of managerial discretion. The em- could first have imposed other rules that would ensure the
ployer argued that the management rights clause permitted outside doors were closed, and the cameras would not stop
it to decide how to run the workplace, and there was intruders, but rather would just film them, and the quality of
no “reasonableness” clause in the collective agreement or the image was so poor the film would be unlikely to identify
anything else there stating that it could not install the an intruder anyway. Therefore, the “bay floor” cameras were
cameras. unreasonably installed and must be removed, or at least ad-
justed to focus exclusively as a live feed on the doors and not
Issue: Did the employer breach an implied obligation to exer- the rest of the bay area where employees are working. The
cise its managerial rights in a “reasonable” manner by installing camera focused on a hallway must also be removed since there
surveillance cameras at the workplace? was no important business reason for it.
Note that in the Woodstock decision the arbitrator refers to a “right of privacy” enjoyed by
unionized workers that needs to be balanced against the employer’s business interests. This right
of privacy was first recognized and developed by arbitrators, and there is not a parallel general
“right to privacy” at work recognized by common law judges for non-union employees. The case
described in Box 35.5 provides another important example of how the implied obligation on
employers to exercise their discretion “reasonably” influenced managerial practices in union-
ized workplaces.49

Company Rules, Reasonableness, and the KVP Test
Communications, Energy and Paperworkers Union of course of a year. A failed breathalyzer test could result in dis-
Canada, Local 30 v. Irving Pulp & Paper, Ltd. cipline up to and including dismissal. The union filed a griev-
2013 SCC 34 ance alleging that the requirement to submit to random
alcohol testing constituted an unreasonable rule that was not
Key Facts: Irving Pulp & Paper introduced a mandatory alcohol justified by any pressing business interest and that violated
testing policy that subjected 10 percent of employees working employees’ privacy. The arbitrator upheld the grievance, find-
in “safety-sensitive jobs” to random alcohol testing over the ing that the employer had failed to identify any pressing

concern relating to alcohol consumption at the workplace that (Robinson). The heart of the “KVP test,” which is gener-
justified the intrusion on employee privacy. However, on judi- ally applied by arbitrators, is that any rule or policy
cial review, the lower court and the New Brunswick Court of unilaterally imposed by an employer and not subse-
Appeal overturned the arbitrator’s ruling. The union appealed quently agreed to by the union, must be consistent
the matter to the Supreme Court of Canada. with the collective agreement and be reasonable.
[Emphasis added]
Issue: Was the employer’s introduction of mandatory, random
alcohol testing a “reasonable” exercise of management rights? In assessing whether a rule is “reasonable,” an arbitrator
Decision: No. The Supreme Court upheld the arbitrator’s deci must consider all of the facts and balance the employer’s legit-
sion that the mandatory testing was “unreasonable,” applying imate business interests and the employees’ interests, includ-
the KVP test. The Supreme Court said the following about that ing their privacy interests. In the case of alcohol testing, an
test: employer may test an employee in a safety-sensitive job when
there exists reasonable cause to believe impairment is a risk,
such as when an employee demonstrates evidence of impair-
When employers in a unionized workplace unilater-
ment, where there has been a serious accident and the em-
ally enact workplace rules and policies, they are not
ployer is seeking its cause, or an employee has a past history
permitted to “promulgate unreasonable rules and
of impairment and testing is part of a rehabilitation plan.
then punish employees who infringe them” (Re
However, absent such special circumstances, mandatory ran-
United Steelworkers, Local 4487 & John Inglis Co. Ltd.
dom alcohol testing would be unreasonable, unless the em-
(1957), 7 L.A.C. 240 (Laskin) …). This constraint arises
ployer can demonstrate that a serious alcohol problem exists
because an employer may only discharge or disci-
at the workplace and there is no other, less intrusive means
pline an employee for “just cause” or “reasonable
available to redress that problem. In this case, the employer
cause”—a central protection for employees. As a
identified eight cases of employee impairment over a 15-year
result, rules enacted by an employer as a vehicle for
period, which the arbitrator found did not meet the threshold
discipline must meet the requirement of reasonable
required to justify the intrusion on employee privacy that ac-
cause. The scope of management’s unilateral rule-
companies random alcohol testing. The Supreme Court upheld
making authority under a collective agreement is
the arbitrator’s decision that ruled that the union’s grievance
persuasively set out in Re Lumber & Sawmill Workers’
should succeed.
Union, Local 2537, and KVP Co. (1965), 16 L.A.C. 73
C. Ancillary Collective Agreement Terms

A third source of collective agreement terms is the collection of ancillary documents that
exist in unionized workplaces that are physically separate from the main collective agreement
document. Ancillary documents include policy manuals, letters of understanding between the
union and employer, insurance plans, and pension documents. Whether these documents are
legally enforceable depends on whether they have been incorporated into the collective agree-
ment or constitute separate contracts. Many arbitration cases have considered whether ancillary
documents form part of the collective agreement and therefore whether terms and conditions
found in them are legally enforceable.
For an ancillary document to be incorporated into a collective agreement, there must be evi-
dence that the parties clearly intended that result.50 The most obvious evidence is explicit incor-
porating language in the collective agreement, such as the following collective agreement term:
The parties agree that the benefits described in Schedule C shall form part of the collective
agreement.
ancillary document: Written materials that are physically separate from an employment contract but that include rules that
relate to the employment relationship. Examples include employee handbooks, benefits handbooks, and human resources policy
manuals.

Even if the ancillary document is not expressly incorporated into the collective agreement,
an arbitrator might nevertheless rule that it is inferentially incorporated, based on other evi-
dence demonstrating the parties intended that result.
Many disputes concern the status of employee benefits plans and the denial of benefits under
those plans. Here is a typical scenario. The union and employer agree to certain benefits for
employees, such as short- and long-term disability wage replacement coverage. One day, em-
ployee Stephen becomes very ill and as a result is unable to perform his job for months on end.
He files a claim for short-term disability benefits, but he is denied by the insurance company
with which the employer contracted to provide the benefits. Stephen believes the denial was
improper. Does Stephen file a grievance under the collective agreement against his employer or
sue the insurance company for violating the insurance contract his employer entered into to
provide the benefits?
The answer depends on a close reading of the collective agreement language and the inten-
tion of the parties. Years ago, the leading arbitration text (Canadian Labour Arbitration, known
simply as “Brown and Beatty” by practitioners, after the names of the text’s authors) summarized
the case law dealing with this issue and identified the following four categories of collective
agreement language:51
1. An insurance plan or policy exists but is not mentioned at all in the collective agree-
ment. A dispute about the plan is not arbitrable since the insurance plan or policy is not
incorporated into the collective agreement.
2. The collective agreement provides that employees will be paid a specific benefit if cer-
tain conditions are met. A dispute over the failure to provide the benefit is arbitrable,
since the employer has promised to provide the benefit. The fact that the employer
elected to take out insurance does not relieve it of the responsibility to pay the benefit.52
3. The collective agreement requires only that the employer pay premiums on an insur-
ance policy. A dispute over the denial of a benefit by the insurance company is not
arbitrable. However, a dispute over the failure of the employer to pay premiums on a
“standard insurance policy” that provides the benefits negotiated by the union is arbi-
trable.53 If an employer fails to obtain insurance that provides the benefits required by the
collective agreement, it may be found liable in damages for the unpaid benefits in an arbi-
tration hearing.
4. A specific plan or policy is incorporated by reference into the agreement. A dispute is
arbitrable since the terms of the plan form part of the collective agreement.54
Countless arbitration decisions have applied these categories (see the exercise at the end of
this chapter). For example, in the case of Kone Inc. v. International Union of Elevator Construc-
tors, Local Union No 82, collective agreement language stating that the insurance plan “shall be
part of this Agreement” was found by a BC arbitrator to constitute an obvious example of cat-
egory four.55 Therefore, a denial of benefits by the insurance company could be the subject of
a grievance against the employer. In UPM-Kymmene Miramichi v. Communications, Energy and
Paperworkers Union of Canada, Local 689, the agreement required the employer to “maintain”
the present dental coverage and to reimburse employees for covered expenses, which included
“70 percent dentures, crowns and bridges” to a maximum of $1,500 per year. This language in
the agreement was found to be an example of category two, so the employer was liable when the
insurer refused payment for denture work.56
In the often-cited decision described in Box 35.6, the arbitrator considered whether the
denial of benefits to an employee by an insurance company was a violation of the collective
agreement.


Is an Insurance Company’s Denial of Insurance Benefits a Breach of the Collective Agreement?
Coca-Cola Bottling Ltd. v. U.F.C.W. language in this case did not fit perfectly into any one of them.
(1994), 44 LAC (4th) 151 (Arbitrator Goodfellow) The key issue to consider was whether the parties intended
the employer to bear the cost and risk of liability for LTD bene-
Key Facts: An employee claimed long-term disability (LTD) fits, or whether they intended that the employer be permitted
benefits but was denied by the insurance company Coca-Cola to pass on that risk to a third-party insurer by taking out an
Bottling had contracted with to provide the benefits. The insurance policy and paying the benefits:
union filed a grievance under the collective agreement, alleg-
ing that the employer was responsible for paying the benefits. insurance plans are normally concluded between an
The employer argued that its only obligation under the collec- employer and an insurance carrier, and individual
tive agreement was to pay premiums on an insurance contract employees are not direct parties to those plans, al-
that offered the benefits required by the collective agreement, though they appear to have enforceable rights as
which it had done. The denial of the LTD benefits by the insurer beneficiaries. But those rights cannot be enforced in
was a dispute with the insurer and not the employer under the the arbitration process, because they do not arise
collective agreement. under the collective agreement. The rights may only
The collective agreement stated the following: “A new Long be enforced against the carrier by the employer, a
Term Disability Plan will be introduced … Details of this contracting party to the insurance plan, or by the
change are set out in a Letter of Agreement attached hereto.” employee as an individual beneficiary. Thus, the
The letter of agreement then provided that the employer will question in all of these cases is whether the em-
introduce “a long term disability insurance program which will ployee is left to his or her rights in the courts against
include the following features,” followed by a detailed list of the insurance company under the insurance plan, or
the features of the insurance program. The letter also specified whether the employee may require the employer to
that the employer will pay “60% of the LTD premium” and the pay the benefits directly, and pursue its own rights
employee would pay the rest. The employer entered into an against the insurer.
insurance contract with an insurance company to provide the
benefits required and paid its share of the premiums to main- The arbitrator ultimately found that the language in the
tain the plan. That insurer denied the employee’s claim. collective agreement was a hybrid of categories two and three
of Brown and Beatty, and that the parties intended that the
Issue: Did the insurer’s denial of LTD benefits to the employee employer would take out an “insurance” contract that provided
violate the collective agreement? the benefits detailed in the letter of agreement and pay the
Decision: No. The issue in this case was whether the collective premiums as required. Therefore, the union and the employee
agreement required the employer to pay LTD benefits or mere- could not proceed to arbitration against the employer to
ly to take out a standard insurance policy providing for LTD dispute the insurer’s denial of LTD benefits. The employee
benefits. The arbitrator noted that the four categories in Brown could sue the insurance company in court if he believed the
and Beatty are “of assistance,” but also concluded that the insurer violated the insurance contract.
Note that if a benefit plan is found not to be incorporated into the collective agreement, then
the employee will usually have the option of suing the insurance company as a beneficiary under
the insurance contract. This option is usually less desirable for the employee than filing a griev-
ance against the employer under the collective agreement, since often the union will not fund
the private litigation for the employee.
VI. Chapter Summary

The collective agreement is a fundamentally different type of contract than the individual (non-
union) employment contract. The legal rules that govern collective agreements are distinct in
important ways. A substantial component of public policy is injected into collective agreements
through collective bargaining legislation in the form of mandatory, default, and prohibited
terms. In addition, labour arbitrators play an important role in giving form and substance to the

language negotiated by unions and employers. This chapter introduced the concepts of reserved
management rights and implied reasonableness developed by arbitrators. In the next two chap-
ters, we will explore in greater detail the role of labour arbitration and labour arbitrators in the
collective bargaining regime.

1. Who are the parties to a collective agreement?
2. Describe an example of a mandatory collective agreement term, a default collective agree-
ment term, and a prohibited collective agreement term.
3. Why are collective agreements often longer and more detailed than individual (non-union)
employment contracts?
4. Explain the concept of reserved management rights.
5. Identify and explain two situations in which labour arbitrators have implied an obligation
for employers to act “reasonably.”
APPLYING THE LAW

County Beer management decides to install secret surveillance ment (see the appendix to this chapter). The agreement in-
cameras in the warehouse. No specific problem caused this cludes a “management rights” clause that grants the employer
decision, but the company wants to be able to occasionally the exclusive right to “manage the enterprise” and there is no
watch whether employees are working hard or malingering. other express restriction on the right of the employer to install
Also, if the company later has concerns about theft or safety cameras. Therefore, the employer goes ahead with the instal-
violations, it will have video footage to watch. The cameras lation. A month later, the union learns about the cameras and
would record all areas of the warehouse where employees files a grievance demanding they be removed. What argument
work plus the cafeteria and footage will be saved for four days would the union and employer make before an arbitrator? Do
and then deleted. Management reviews the collective agree- you think the union would win its grievance?
EXERCISE
Dozens of arbitration cases involve disputes over the denial of benefits to employees by an insur-
ance company, and a central issue is whether the collective agreement requires the employer to
provide the benefits or simply pay premiums to an insurance company. The answer matters
because it decides whether the employee can file a grievance against the employer or has to sue
the insurance company in a court. Arbitrators apply the Brown and Beatty “four categories”
discussed in this chapter. Try this exercise.

2. In the “Document text” search box, type the following: “Brown and Beatty” and “four cat-
egories.” This search should produce dozens of decisions in which the four categories are
considered.
3. Scan the case headnotes and select a case that looks interesting and involves a dispute over
whether the collective agreement requires the employer to pay benefits. Read the decision
and answer the following questions:
a. What benefit was the employee denied?

b. What is the collective agreement language in dispute?

c. Which of the four categories does the arbitrator decide the language falls into? Is the
answer that the language is a “hybrid” of more than one category?
d. What is the arbitrator’s decision on the question of whether the insurance company’s
denial of benefits constituted a breach of the collective agreement?

1. See the discussion in Berry v. Pulley, 2002 SCC 40; and 12. Ford Motor Company v. United Automobile Workers Union,
Young v. C.N.R. (1931), 1 DLR 645. We consider the legal [1946] OLAA No. 1; and Syndicat Catholique des Employés
status of unions in the common law in more detail in de Magasins de Québec Inc. v. Paquet Ltée, supra note 5.
Chapter 37. 13. See Ontario Labour Relations Act, supra note 3, s. 47 (non-
2. Wartime Labour Relations Order PC 1003 is available at construction only); Canada Labour Code, RSC 1985,
<https://en.wikisource.org/wiki/Wartime_Labour_Rela- c. L-2, s. 70; and Newfoundland and Labrador Labour
tions_Regulations>. See ss. 1(d), 10(5). Relations Act, RSNL 1990, c. L-1, s. 87.
3. See, for example, Ontario Labour Relations Act, 1995, SO 14. Ontario Labour Relations Act, supra note 3, s. 47 (1).
1995, c. 1, Sched. A, s. 56; and BC Labour Relations Code, 15. United Masonry Construction Ltd. (1980), 2 CLRBR 416
RSBC 1996, c. 244, s. 48. (SLRB).
4. PC 1003, supra note 2, ss. 17, 18. 16. In Saskatchewan, a union dues check-off provision is not
5. McGavin Toastmaster Ltd. v. Ainscough, [1976] 1 SCR 718. required to be in the collective agreement, but the statute
See also Syndicat Catholique des Employés de Magasins de requires dues check-off if both the employee and union so
Québec Inc. v. Paquet Ltée, [1959] SCR 206; and Canadian request: Saskatchewan Employment Act, SS 2013, c. S-15.1,
Pacific Railway Co. v. Zambri, [1962] SCR 609. s. 32. In Alberta, British Columbia, and Nova Scotia, the
6. McGavin Toastmaster Ltd. v. Ainscough, supra note 5 at statute requires union dues check-off when an employee
725. authorizes it. Prince Edward Island requires an employee
authorization for union dues deduction if the collective
7. For example, New Brunswick requires the inclusion of a
agreement does not provide for automatic dues deduction:
term requiring employers to provide the union with notice
PEI Labour Act, RSPEI 1988, c. L-1, s. 45.
of the introduction of new technology: Industrial Relations
Act, RSNB 1973, c. I-4, s. 55.1. 17. See United Steelworkers of America v. Bennett Chevrolet
Geo Oldsmobile Cadillac Ltd., 1999 CanLII 19491 (Ont.
8. See, for example, BC Labour Relations Code, supra note 3,
LRB) (a collective agreement must “operate” for at least
s. 57; Alberta Labour Relations Code, RSA 2000, c. L-1,
one year, and it is not sufficient simply to make the term
ss. 73, 74; and Ontario Labour Relations Act, supra note 3,
clause retroactive to a date in the past).
s. 46. In Quebec and Nova Scotia, there is a limited right to
strike or lockout during the term of a collective agreement 18. See, for example, BC Labour Relations Code, supra note 3,
in the context of mid-term revisions to the contract: Nova s. 50; and Ontario Labour Relations Act, supra note 3, s. 58.
Scotia Trade Union Act, RSNS 1989, c. 475, s. 48; and 19. See, for example, Ontario Labour Relations Act, supra note
Quebec Labour Code, CQLR c. C-27, s. 107. 3, s. 54 (collective agreement must not discriminate con-
9. Ontario Labour Relations Act, supra note 3, s. 48. trary to human rights legislation and the Charter). In
Manitoba, the statute declares void any collective agree-
10. Manitoba Labour Relations Act, CCSM c. L10, s. 76. Que-
ment term that requires an employer to terminate an em-
bec’s Labour Code requires union dues check-off too, al-
ployee for engaging in activities on behalf of a union:
though it does not expressly require that a union dues
Manitoba Labour Relations Act, supra note 10, s. 23 (3).
clause be included in collective agreements: Quebec
Labour Code, supra note 8, s. 47. 20. Peterboro Lock Mfg. Co. Ltd (1953), 4 LAC 1499 (Laskin).
11. For example, both British Columbia and Manitoba require 21. See Voice Construction Ltd. v. Construction & General
a collective agreement to include a term establishing a Workers’ Union, Local 92, 2004 SCC 23 at para 32.
joint consultation committee to discuss workplace issues if 22. Essar Steel Algoma Inc., 2014 CanLII 29950 (Ont. LA).
one party requests such a term to be included. BC Labour 23. See Tung-Sol of Canada Ltd. (1964), 15 LAC 161 (Reville)
Relations Code, supra note 3, s. 53; and Manitoba Labour for an often-cited discussion of the importance of seniority
Relations Act, supra note 10, s. 81. in the collective bargaining regime.

24. See the discussion in D. Brown & D. Beatty, Canadian (installation of surveillance cameras not “unreasonable”).
Labour Arbitration, 4th ed (Aurora, ON: Canada Law See also Winnipeg (City), 2017 CanLII 72394 (Man. LA).
Book, 2006) at 6:1, 120; and Children’s Aid Society of Cape 36. See Association of Justice Counsel v. Canada (Attorney
Breton (1996), 61 LAC (4th) 70 (La Forest). General), 2017 SCC 55; and Dalhousie University v. Dal-
25. What constitutes a “promotion” is sometimes a matter of housie Faculty Association, 2012 CanLII 51374 (NSLA).
debate. See, for example, Canadian Blood Services (2002), 37. Thrifty (Canada) Ltd. v. O.P.E.I.U., Local 378 (2001), 100
102 LAC (4th) 223 (Devlin). LAC (4th) 162 (Larson).
26. Whether a layoff has occurred is sometimes a matter of 38. See the discussion in Brown & Beatty, supra note 24 at 4:2,
contestation: see Battlefords and District Co-operatives Ltd. 320; and M. Mitchnick & B. Etherington, Labour Arbitra-
v. RWDSU, Local 544, [1998] 1 SCR 1118; Canada Safeway tion in Canada (Toronto, ON: Lancaster House, 2006) at
Ltd. v. RWDSU, Local 454, [1998] 1 SCR 1079; Crown 280-84.
Ridge Place Nursing Home (1998), 72 LAC (4th) 232 (Mar-
39. Bhasin v. Hrynew, 2014 SCC 71.
cotte); and Colonial Cookies (1990), 13 LAC (4th) 405
(Foisy). 40. University Health Network, 2017 CanLII 82795 (Ont. LA).
See also Brampton Hydro Electric Commission v. C.A.W.-
27. For a discussion of seniority rights in collective agree-
Canada, 1993 CanLII 8488 (Ont. Gen Div). This duty of
ments, see R. Snyder, Collective Agreement Arbitration in
honest and good faith performance has been applied by
Canada, 5th ed (Markham, ON: LexisNexis, 2013) at chap-
labour arbitrators to collective agreements: Islamic Foun-
ters 16 and 17; and Brown & Beatty, supra note 24 at
dation School, 2018 CanLII 48194 (Ont. LA); Bell Canada,
chapter 6.
2016 CanLII 11573 (CA LA); and Global Edmonton, 2015
28. Maloney Electric Corp. (1985), 22 LAC (3d) 170 (Picher). CanLII 72296 (Alta. GAA).
29. See Central Okanagan School District No. 23 v. Renaud, 41. Re Council of Printing Industries of Canada, 1983 CanLII
[1992] 2 SCR 970; McGill University Health Centre (Mont- 1638 (Ont. CA); Metropolitan Toronto (Municipality) v.
real General Hospital) v. Syndicat des employés de l’Hôpital C.U.P.E., 1990 CanLII 6974 (Ont. CA); University Health
général de Montréal, 2007 SCC 4; Bayer Rubber and Com- Network, supra note 40; Re L/3 Communications/Spar
munication Energy and Paperworkers Union of Canada, Aerospace Ltd. (2004), 127 LAC (4th) 225 (Wakeling); Re
Local 914 (1997), 65 LAC (4th) 261; Terminal Forest Prod- Greater Toronto Airports Authority (2010), 191 LAC (4th)
ucts (Mainland Sawmill Division), 2016 CanLII 30971 277 (Shime); and Western Avalon Roman Catholic School
(BCLA) (Coleman); Canada Post Corp. v. C.U.P.W. (1993), Board, 2000 NFCA 39. See also Brown & Beatty, supra
33 LAC (4th) 279; and Lyle v. The Bloom Group (No. 2), note 24 at 4:2, 326.
2016 BCHRT 45.
42. Weston School District (2011), 213 LAC (4th) 129
30. See, for example, McKellar General Hospital, [1986] OLAA (Oakley). On the other hand, if the collective agreement
No. 5. See also Meadow Park Nursing Home (1983), 9 LAC simply states a rule without granting the employer discre-
(3d) 137 (Swan); and Greater Toronto Airports Authority tion over implementation of the rule, then the inference is
(2010), 191 LAC (4th) 277 (Shime). But see Compass Min- that the employer has the exclusive right to apply and
erals Canada Corp., 2017 CanLII 72647 (Ont. LA) at para enforce the rule, and no implied reasonableness standard
23 (an arbitrator cannot imply a term based on the pre- exists: Re Metropolitan Toronto Board of Commissioners of
sumed intent of the parties). Police and Metropolitan Toronto Police Association et al.,
31. See also Anne & Max Tanenbaum Community Hebrew 1981 CanLII 1689 (Ont. CA); and Stelco Inc. v. United
Academy of Toronto, 2019 CanLII 84521 (Ont. LA); and Steelworkers of America, Local 1005 et al., 1994 CanLII
Halifax Regional Water Commission, 2016 CanLII 32348 10573 (Ont. Gen Div).
(NSLA) (Richardson) (the employer’s response to alleged 43. See the discussion in Re Lumber and Sawmill Workers’
harassment was reasonable). Union, Local 2537 v. KVP Co. Ltd. (1965), 16 LAC 73
32. See, for example, Lloyd v. Imperial Parking Ltd., 1996 (Robinson); Metropolitan Toronto (Municipality) v.
CanLII 10543 (Alta. QB); and Boucher v. Wal-Mart C.U.P.E., supra note 41; Communications, Energy and
Canada Corp., 2014 ONCA 419. Paperworkers Union of Canada, Local 30 v. Irving Pulp &
33. New Brunswick v. O’Leary, [1995] 2 SCR 967. Paper, Ltd., 2013 SCC 34; and York University, 2012 CanLII
41233 (Ont. LA).
34. Polymer Corp. and Oil, Chemical and Atomic Workers’
International Union, Local 16-14 (1958), 10 LAC 31 44. KVP Co. Ltd., supra note 43. See also the discussion in
(Laskin), aff ’d [1962] SCR 338. Irving Pulp & Paper, Ltd., supra note 43; and Metropolitan
Toronto (Municipality) v. C.U.P.E., supra note 41.
35. Manitoba Labour Relations Act, supra note 10, s. 80. See
Carte International Inc., 2018 CanLII 37195 (Man. LA) 45. KVP Co. Ltd., supra note 43 at 85.

46. For a review of those cases, see Brown & Beatty, supra note 51. Brown & Beatty, supra note 24 at 4:1, 400. See also Elkview
24 at chapter 4 (4:1, 500 Company Rules) and, in par- Coal v. United Steelworkers, 2001 BCCA 488 (considering
ticular, 4:1, 524 (The Reasonableness Requirement). whether an arbitrator can decide if an insurer discrimi-
47. See, for example, Woodstock (City), 2015 CanLII 20641 nated against an employee).
(Ont. LA) (Parmar) (surveillance cameras were unreason- 52. UPM-Kymmene Miramichi, Inc., 2002 NBQB 139; Wilpark
able); Lenworth Metal Products (2000), 29 Admin. LR (3d) Foods (1991), 21 LAC (4th) 441 (Ladner); Cargill Ltd.
258 (OSJ) (cameras); IKO Industries Ltd. (2005), 140 LAC (2016), 126 CLAS 172 (McPhillips); Morris v. Manufactur-
(4th) 393 (Tims) (biometric timekeeping system was un- ers Life Assurance Co., 2005 CanLII 4580 (Ont. Sup Ct J)
reasonable); Gerdau Ameristeel (2011), 211 LAC (4th) 93 (agreement permitted grievances relating to benefits); and
(Tacon) (biometric scanner was not unreasonable); Enercare Home Services, 2019 CanLII 50891 (Ont. LA).
Niagara Falls (City), 2015 CanLII 67502 (Ont. LA); Cente- 53. See, for example, CBC v. Burkett, 1997 CanLII 1078 (Ont.
nary Health Centre, 1999 CanLII 19037 (Ont. LA); and Yee CA); Pavaco Plastics Inc., 2013 CanLII 7304 (Ont. LA)
Hong Centre For Geriatric Care, 2019 CanLII 54740 (Ont. (Carrier); Consumers Glass, 2000 CanLII 28033 (Ont. LA)
LA) (video surveillance of employee in a client’s room (Albertyn); Sault Area Hospital (2012), 219 LAC (4th) 105
within seniors’ residence was admissible). (Steinberg); and Nechako Northcoast, 2010 CanLII 91779
48. See, for example, Ottawa Hospital, 2013 CanLII 643 (Ont. (BCLA). The requirement that the insurance policy be of a
LA) (rule banning tattoos and piercings was unreason- “standard nature” is an implied obligation read in by
able). See also D. Doorey, “Can an Employer Prohibit arbitrators.
Tattoos and Piercings?” online, Law of Work (blog): 54. Kone Inc., 2014 CanLII 47211 (BCLRB); Burns Meats
<http://lawofwork.ca/?p=6119>. (1995), 50 LAC (4th) 415 (Hamilton); TRW Canada
49. See also Trimac Transportation Services-Bulk Systems (1991), 19 LAC (4th) 374 (O’Shea); and Coca-Cola Bottling
(1999), 88 LAC (4th) 237 (Burkett) (mandatory drug and Ltd. (1998), 76 LAC (4th) 105 (Christie).
alcohol policy was unreasonable); and Fording Coal Ltd. 55. Kone Inc., supra note 54.
(2000), 88 LAC (4th) 408 (Hope).
56. UPM-Kymmene Miramichi, Inc., supra note 52.
50. Canada Bread Co. Ltd. (1970), 22 LAC 98 (Christie).

APPENDIX
Sample Collective Agreement
This mandatory term

identifies which employ- Sample Collective Agreement
ees the collective
agreement governs. The
between
recognition clause often Beer Workers Union, Local 67 (Union)
mirrors the bargaining and
union description in the County Beer Company, Inc. (Employer)
certification of the union
originally issued by the RECOGNITION
labour relations board.
1.01 The Employer recognizes the Union as the sole bargaining agent for all employees in
Belleville, Ontario, save and except salespersons, office and clerical employees, managers,
and persons above the rank of manager.
Most provinces treat the
union dues clause as a 1.02 In the event that the Employer decides to move its Belleville operations to a new
default contract clause. location within 100 kilometres of Belleville, bargaining unit employees displaced by the
The union determines move shall be given preferential consideration in hiring for the new location.
the amount of dues, usu-
UNION SECURITY
ally in its constitution.
Note that this collective 2.01 The Employer shall deduct, monthly, from the pay of each bargaining unit employee
agreement does not such union dues, fees, and assessments as prescribed by the Union in its Constitution and
include a mandatory as directed by the Union. The Employer shall remit the amount so deducted to the Union
union membership by direct deposit on the fifteenth day of each month following. The Employer shall also
clause. Therefore, by provide the Union with a statement each month indicating the name of each employee
requiring mandatory from whose pay deductions have been made and the amount deducted.
union dues check-off and 2.02 The Union agrees to indemnify and save the Employer harmless against all claims or
not mandatory union other forms of liability that may arise out of or by reason of deductions made in
membership, this clause accordance with this article.
aligns with the Rand
Formula. MANAGEMENT RIGHTS
3.01 Subject to the terms of this Agreement, the Union acknowledges that it is the
exclusive function of the Employer to manage the enterprise, and to hire, promote, demote,
This is a typical manage- classify, transfer, and suspend employees, and to discipline or discharge employees for just
ment rights clause. It cause, provided that a claim by an employee or the Union that the terms of the Agreement
explains that the em- have been violated may be the subject of a grievance.
ployer reserves the right
to manage the enterprise
subject to restrictions or
limits bargained by the
union. As noted in the
chapter, arbitrators have
sometimes implied a
requirement that man-
agement exercise its
discretion in a “reason-
able” manner.

Union stewards are usu-

ally employees elected UNION STEWARDS
by their co-workers to
4.01 The Employer acknowledges the right of the Union to appoint 2 Union stewards. The
act as the union’s repre-
Employer agrees to instruct its managers to co-operate with the stewards in carrying out
sentative in the
the terms and requirements of this agreement. The Union agrees to instruct the stewards to
workplace. They assist
similarly co-operate with the managers.
the union to administer
the collective agreement 4.02 The Employer agrees that Union stewards are entitled to leave their work posts
on a day-to-day basis. without loss of pay in order to the perform their Union functions, including to investigate
and administer grievances, provided that they first advise a manager and receive
permission to leave, which permission will not be unreasonably refused.
A grievance procedure is
required by collective GRIEVANCE PROCEDURE
bargaining legislation. It 5.01 The Employer, Union, or a bargaining unit employee may file a grievance in
usually involves several accordance with this grievance procedure if they believe a term of the collective agreement
steps, with each step has been violated.
involving progressively 5.02 Timelines set forth in this grievance procedure can only be extended with the
more senior employer agreement of the Union and the Employer, and an arbitrator may not extend them without
and union officials in an such agreement.
attempt to resolve the
dispute without an 5.03 Step One: An aggrieved employee shall either personally or through a steward present
expensive arbitration a written grievance, signed by the grievor, to a manager. The manager shall consider the
hearing. grievance and render a decision in writing within 2 working days. If a resolution is not
reached, the grievor or the steward shall proceed to the next step of the grievance
procedure within 5 days thereafter.
Note that only the em- 5.04 Step Two: A Union steward may present the written grievance to a manager and
ployer or union (the within 5 working days, the manager (or a designate) shall meet with the steward in an
“parties”) can refer a attempt to resolve the grievance. If the grievance is not resolved, the Union may refer the
grievance to arbitration, grievance to Step Three within 5 working days of the Step Two meeting.
not an employee. It is 5.05 Step Three: The Union may refer the grievance to the Human Resources Manager.
common for collective Within 5 working days, the HR Manager shall meet with a representative of the Union,
agreements to grant the including a Union Business Agent, in an attempt to resolve the grievance.
union “carriage” of the
5.06 Employer Grievance: The Employer may file a grievance by serving the grievance on a
grievance at the point of
Union Steward or other Union representative. Within 10 days, the Employer and a Union
the decision to refer to
official shall meet to discuss and attempt to resolve the grievance.
arbitration. Since the
union pays for the cost of 5.07 Step Four: If a grievance is not resolved at or before Step Three, or an Employer
an arbitration (with the grievance is not resolved at the meeting referred to in Article 5.06, either party may refer
employer), the union the grievance to arbitration within 30 days of the Step Three meeting.
acts as gatekeeper to
avoid frivolous or poten-
tially harmful grievances
from moving forward.
(For the implications of
this gatekeeping role, see
Chapter 37.)

The union and employer

choose the arbitrator, ARBITRATION
unlike in common law
6.01 The parties agree that the following arbitrators will hear and decide grievances
breach of contract law-
referred to arbitration and that grievances will be referred to the arbitrators in the order in
suits, where the parties
which their names appear:
get whatever judge is
assigned the file (see Professor Elaine Arnott
Chapter 36). Mark Alexander
Stacey Markus
This clause is a manda- Mohammed Llimik

tory term that dates back 6.02 The decision of the arbitrator is final and binding on the Employer, Union, and
to PC 1003 in 1944 and is affected bargaining unit employees.
a distinctly Canadian
6.03 The parties shall share the expense of the arbitrator equally.
addition to the Ameri-
can-based Wagner
NO STRIKE OR LOCKOUT
model of collective
bargaining. 7.01 There shall be no strike or lockout during the term of this collective agreement.
DISCHARGE AND DISCIPLINE

8.01 No employee shall be disciplined or discharged without just cause.
“Just cause” provisions
such as this are standard
SENIORITY
in Canadian collective
agreements. They mark 9.01 Seniority means length of continuous service with the employer from the date of hire.
one of the most substan- 9.02 The employee shall post any vacancies on the bulletin board. In the case of job
tial differences between competitions for posted positions within the bargaining unit, the following factors shall be
non-union employment considered: (a) seniority and (b) skill and ability. Where skill and ability of applicants is
contracts and collective relatively equal, the more senior employee shall be awarded the promotion.
agreements. A unionized
9.03 Layoffs shall be by order of seniority with more senior employees being laid off last,
employer subject to a
provided the senior employee has the skill and ability to perform a job in the bargaining
just cause provision must
unit. More senior employees shall be recalled from temporary layoff first, provided the
establish it had a good
senior employee possesses the necessary skill and ability to perform a job in the bargaining
business reason to disci-
unit.
pline or dismiss an
employee, whereas a 9.04 Seniority and employment shall terminate when the employee quits, is discharged for
non-union employer can just cause in accordance with this agreement, or is laid off for a period of 24 months or
usually dismiss an em- more.
ployee without any
reason, provided that it
gives notice of
termination.
Seniority rights confer various benefits and advantages on more senior (i.e., longer
serving) employees. How seniority is defined and what role it plays vary from
agreement to agreement. In this clause, senior employees enjoy preference in job
competitions, but that benefit is contingent too on a skill and ability component.

This clause is a response

to the Russel Steel deci- CONTRACTING OUT
sion discussed in this
10.01 The Employer shall not contract out work that will result in the layoff or discharge of
chapter. It restricts the
a bargaining unit employee.
employer from contract-
ing out work, but only if HEALTH AND SAFETY
doing so will result in a
bargaining unit employee 11.01 The parties agree to a Safety and Health Committee consisting of 3 members elected
losing their job. or appointed by the Union and 3 members appointed by the Employer who will meet
regularly and make inspections of the workplace from time to time.
HEALTH AND WELFARE BENEFITS

Canadian occupational
12.01 Schedule A to this Agreement provides a description of The wage schedule is
health and safety legisla-
benefits that shall be provided to employees for the term of this expressly incorporated into
tion requires joint health
Agreement. Schedule A is incorporated into this Agreement. It is the collective agreement.
and safety committees.
agreed that the Employer will pay the full cost of premiums on Unlike an individual
Often collective agree-
an insurance contract through which the described benefits will employment contract, col-
ments spell out in greater
be provided. lective agreement wage
detail than this clause
clauses cannot usually
what duties a committee
WAGES state unilaterally to give
will perform.
13.01 During the term of this Agreement, the parties agree that out raises or bonuses to in-
all payments of wages will be made in accordance with the wage dividual bargaining unit
rates set forth in Schedule B, which is hereby made part of this employees.
Note that the Schedule Agreement.
(an ancillary document)
is expressly incorporated PAID VACATION Here is an example of a
into the collective agree-
14.01 All employees who have acquired one year’s seniority by benefit that increases with
ment. Also note that the
July 1 of any year shall be entitled to two weeks’ paid vacation to accumulated seniority. The
clause explains that the
be taken at a time convenient to the employer. requirement for the em-
employer’s responsibility
ployer to consider seniority
is to pay premiums on an 14.02 All employees who have acquired six years’ seniority by
in scheduling vacations is
insurance policy that July 1 of any year shall be entitled to three weeks’ paid vacation
a weaker form of seniority
provides the benefits to be taken at a time convenient to the employer.
protection than a term that
listed. Provided the em- 14.03 All employees who have acquired twelve years’ seniority requires that “seniority
ployer does so, a denial by July 1 of any year shall be entitled to four weeks’ paid vacation shall govern.”
by the insurance com- to be taken at a time convenient to the employer.
pany of a claim will
probably not be a breach 14.04 In determining the timing of vacations, the employer shall
of the collective agree- consider seniority.
ment and will not be
grievable.

Another mandatory
clause, this duration DURATION
clause ensures that the
15.01 This Agreement shall become effective on December 1, 2019, and terminate on
collective agreement
November 30, 2022.
“operates” for at least one
year. No mandatory max-
imum length of a
On Behalf of the Union: On Behalf of the Employer:
collective agreement
exists. Collective bargain-
ing statutes read into
collective agreements an
open period during Jack Dundas Amanda Wellington
which employees can file Union Staff Representative Industrial Relations Manager
an application to decer-
tify the union or another
union can raid an
existing union (see Chap- Owen Sharpe
ter 32). Local Union President and Chair,
Bargaining Committee


CHAPTER 36
Grievances, Labour Arbitration, and

“Just Cause” for Discipline
in the Unionized Workplace
II. The Grievance Procedure 611
• Describe the different types of grievances.
A. Filing a Grievance 612
• Describe the grievance procedure. B. Settling or Withdrawing a Grievance 613
• Outline the labour arbitration process. III. The Labour Arbitration Process 614
• Describe the expanding scope of labour arbitration IV. The Labour Arbitration Decision 616
and how this development is affecting the labour V. Labour Arbitration Remedies 616
arbitration process. VI. The Expanding Scope of Labour Arbitration 617
• Describe the remedial authority of labour arbitrators. VII. What Is “Just Cause” for Discipline or Dismissal in Unionized Workplaces? 621
A. The Basic Building Blocks of “Just Cause” Arbitration Law 622
• Describe how arbitrators interpret “just cause”
B. Summary of Specific Grounds for Discharge and Discipline 626
provisions in collective agreements across a range of
employee misconduct situations. VIII. Chapter Summary 635
I. Introduction
In earlier chapters, we discussed how a distinctive component of Canadian collective bargaining
law is the prohibition on work stoppages during a collective agreement, which dates back to PC
1003 of 1944.1 Since the parties to a collective agreement cannot resort to “industrial warfare”
to settle disputes over the interpretation, application, and enforcement of the collective agree-
ment, a system for resolving disputes without work stoppages is needed. That system is the
grievance and labour arbitration process, the subject of this chapter. Collective bargaining stat-
utes require that all collective agreement disputes be resolved by “final and binding” labour
arbitration. Those statutes shift collective agreement disputes from the courts to the specialized
legal world of labour arbitration, which has its own procedures, norms, and expansive body of
case law that operate like a type of common law of collective agreements. This chapter examines
the procedure by which a grievance is filed and processed through to the arbitration stage. It
concludes with a discussion of the expanding scope of labour arbitration and an exploration of
“just cause” provisions in Canadian labour arbitration.
II. The Grievance Procedure

According to the Supreme Court of Canada, the labour arbitration process serves both a private
and public function: arbitration resolves private disputes over contract application, and it also
serves the important public function of ensuring “the peaceful resolution of labour disputes.”2
611

The filing of a grievance commences a legal process detailed in the collective agreement’s griev-
ance procedure. The objective of the grievance procedure is to explore the possibility of resolv-
ing the dispute without litigation. There are different types of grievances. The most common is
an individual grievance filed by an employee (known as the grievor), alleging that their collec-
tive agreement rights have been violated by the employer. A group grievance is filed on behalf
of two or more employees who allege they have suffered harm as a result of the same collective
agreement violation by the employer. A union may file a policy grievance if the employer’s
alleged wrongdoing is of general interest to the bargaining unit and not specific to an individual
employee. Finally, an employer may also file a grievance alleging a breach of the collective agree-
ment by the union or an individual employee (employer grievance).3
A. Filing a Grievance

Assume that Jessica has worked at County Beer Company for ten years. One day she is terminated
because the employer finds a beer in her bag and believes that she stole it from the workplace. Jes-
sica denies stealing the beer and says that she placed the beer in her bag after her softball game the
night before and forgot it was there. With the help of her union, she files a grievance alleging that
she was terminated “without just cause” contrary to the collective agreement. Jessica’s grievance
form would look like the left-hand document in Box 36.1. The grievance activates the grievance
procedure in the collective agreement between the employer and Jessica’s union. Usually, the griev-
ance procedure requires the employer to respond within a defined period of time either by accept-
ing the grievance and granting the remedy sought or by “denying” it. A denial advances the
grievance forward to the next stage of the grievance procedure, which typically involves meetings
between the employer and union representatives to try and resolve the grievance by either the
employee or union withdrawing or “dropping” the grievance or the parties reaching some form of
settlement. A grievance that is not withdrawn or settled may eventually be referred to
arbitration.
B. Settling or Withdrawing a Grievance

Most grievances are settled or withdrawn (dropped) either during the grievance procedure or
at the outset of the arbitration hearing. Sometimes an arbitrator will first help the parties to settle
by acting as a mediator and then acting as an arbitrator if a settlement is not reached (a process
known as mediation-arbitration, or “med-arb”). A settlement is in writing and sets out the
conditions of the resolution. For example, assume that County Beer Company is concerned that
an arbitrator will believe Jessica’s story about the beer and will reinstate her with no punishment,
and that the union is concerned that the arbitrator will uphold the termination. Both sides see
risk in proceeding to an arbitration hearing, so they agree to settle the grievance on the basis
that Jessica gets her job back and a two-month unpaid suspension is entered into her employee
file. The grievance settlement would look something like the right-hand document in Box 36.1.
grievance: A formal complaint lodged under a collective agreement that alleges a contravention of the collective agreement.
individual grievance: A grievance filed by an individual employee alleging their collective agreement rights have been
violated by the employer.
grievor: An employee who files a grievance.
group grievance: A grievance filed on behalf of two or more employees who allege the same or a similar breach of the
collective agreement.
policy grievance: A grievance filed by a union that raises an issue (or issues) that is of general interest to all or many em-
ployees in the bargaining unit.
employer grievance: A grievance filed by an employer alleging that an employee or the union has violated the collective
agreement.
mediation-arbitration (“med-arb”): A method of interest arbitration in which the arbitrator acts firstly as a mediator to try
to help the parties reach an agreement, failing which the arbitrator issues a binding decision resolving the dispute.

Chapter 36 Grievances, Labour Arbitration, and “Just Cause” for Discipline in the Unionized Workplace 613

Example of Completed Grievance Form A Grievance Settlement
UNITED BREWERY WORKERS UNION MEMORANDUM OF SETTLEMENT BETWEEN UNITED

STANDARD GRIEVANCE FORM BREWERY WORKERS UNION (UNION)
Employer: County Beer Company AND
Date: June 18, 2020 COUNTY BEER COMPANY, INC. (EMPLOYER)

AND
Grievance Number: 03-20
JESSICA WILLOW (GRIEVOR)
Description of the Alleged Breach of the Collective
Agreement, Including Article Number(s): In the matter of Grievance No. 03-20 (Termination
of Jessica Willow);
I grieve that the employer has fired me
Whereas the parties wish to resolve all matters
without just cause contrary to Article 8.01 of relating to the Grievance;
the Collective Agreement.
The parties hereby agree as follows:
What Remedy Are You Seeking? 1. That the Employer shall reinstate the
Grievor effective August 22, 2020, with no
I seek reinstatement to my job as a bottle loss of seniority.
sorter, with full back pay, benefits, and 2. That a disciplinary 2-month unpaid suspen-
without loss of seniority. sion shall be substituted for the termina-
tion and that a written record of that
Name and Signature of Grievor: suspension will be entered into the Griev-
Jessica Willow J essica Willow or’s personnel file for misconduct identified
as “bringing alcohol into the workplace
Signature of Union Steward/Representative: contrary to company rules.”
Jack Dundas Jack Dundas Signed at Belleville, Ontario, on August 12, 2020.
Amanda Jack Jessica

Wellington Dundas Willow
Once a grievance has been settled or withdrawn, it cannot usually be revived unless the par-
ties had agreed otherwise; for example, by agreeing that the settlement or withdrawal is “with-
out prejudice” to the right to raise the issue again in the future. Similarly, once a grievance is
withdrawn, settled, or decided by an arbitrator, a new grievance challenging essentially the same
alleged breach will not be permitted to proceed. Such a grievance would be blocked by legal
doctrines applied in both courts and arbitrations known as issue estoppel and res judicata.
Some grievances are settled on the basis that an employee will be given “one last chance” to
improve their behaviour. This type of settlement is referred to as a last chance agreement. A last
chance agreement specifies future behaviour that will result in the employee’s employment
without prejudice: A legal phrase used in settlement discussions or agreements that means that the parties retain the right
to revive a complaint or bring a new complaint relating to the same facts or issues in the future.
issue estoppel: A legal principle that prohibits a party from acting in a manner or taking a position that is contrary to a
position that party has made in the past and that has been relied on by the other party.
res judicata: A legal principle that prohibits a party from re-litigating an issue that has already been raised in a prior proceeding.
last chance agreement: A type of settlement of a grievance challenging the termination of an employee that includes
reinstatement of the employee subject to a condition that if the employee reoffends, then termination will be the consequence.

termination. If the employee engages in the specified behaviour, and the employer relies on the
agreement that states termination will be the automatic consequence, the labour arbitrator will
usually limit the inquiry to whether the last chance agreement was violated. If yes, the termin-
ation will be upheld.4
As discussed in Box 36.2, the decision whether to settle, withdraw, or refer an individual,
group, or policy grievance to arbitration usually rests with the union, not any individual
employee.

Who “Owns” the Grievance?
Although collective agreements usually permit individual em- Since unions usually have the authority to drop a grievance,
ployees to file grievances on their own behalf, the ultimate even against the wishes of the grievor, collective bargaining
authority to settle, withdraw, or refer a grievance to arbitration statutes require that unions exercise their discretion in a man-
is usually conferred on the union. Article 5.07 in the sample ner that is not arbitrary, discriminatory, or in bad faith. An
collective agreement in the appendix to Chapter 35 is typical: employee unhappy with the union’s treatment of a griev-
ance may file a duty of fair representation complaint with
Step Four: If a grievance is not resolved at or before the labour relations board. The tests applied by labour relations
Step Three, or an Employer grievance is not resolved boards in those complaints will be explored in Chapter 37.
at the meeting referred to in Article 5.06, either party Later in this chapter, we will learn that the Supreme Court
may refer the grievance to arbitration within 30 days of Canada has expanded the jurisdiction of labour arbitrators
of the Step Three meeting. [Emphasis added] in a manner that requires them to decide disputes involving
common law torts, various employment-related statutes (in-
The “parties” to a collective agreement are the union and cluding human rights and employment standards), and Can-
the employer, not the employees. The union acts as a “gate- adian Charter of Rights and Freedoms* challenges. The fact that
keeper” to the labour arbitration process, because it pays the unions usually control access to labour arbitration raises inter-
high costs of arbitration—which can run into tens of thousands esting access-to-justice concerns in light of these decisions.†
of dollars, depending on the complexity of the case—and also For example, if a union withdraws a grievance asserting a tort
because the union needs to be concerned about what is best or Charter violation, the grievor may be prevented from having
for the bargaining unit as a whole. An individual grievor may their claim decided.
wish their grievance to proceed to arbitration, even if it lacks
merit or advances a legal argument that could be harmful to
* Canadian Charter of Rights and Freedoms, Part I of the Constitution Act,
other employees. Unions want the discretion to drop a griev- 1982, being Schedule B to the Canada Act 1982 (UK), 1982, c. 11.
ance that lacks merit or is not in the interest of the bargaining
† E. Shilton, “Labour Arbitration and Public Rights Claims: Forcing Square
unit. Employers too usually prefer the union to have “carriage” Pegs into Round Holes” (2015 – 2016) 41 Queen’s LJ 275.
of grievances on the assumption that unions will not proceed
to arbitration with grievances that lack merit.
III. The Labour Arbitration Process

Sometimes a grievance is neither settled nor withdrawn and is referred to labour arbitration.
When you file a lawsuit in the courts, you have no choice over which judge is assigned to your
case. By contrast, in labour arbitration, the parties can select their own arbitrator, so once a
grievance is referred to arbitration, that is the next task.5 Single arbitrators decide most cases,
although three-person labour arbitration boards are sometimes appointed. Some collective
duty of fair representation: A legal obligation imposed on unions to represent employees who fall within the scope of their
representation rights in a manner that is not arbitrary, discriminatory, or in bad faith.
three-person labour arbitration board: An arbitration panel consisting of a person appointed by the employer, a person
appointed by the union, and a “neutral” person, sometimes appointed by the two sides.

agreements include a list of agreed-upon arbitrators (see Article 6.01 of the sample collective
agreement in the appendix to Chapter 35), and the parties select the next available arbitrator on
the rotation. Popular arbitrators may not have availability for months. Therefore, to ensure that
access to expeditious arbitration is an option, some collective bargaining statutes include provi-
sions for various forms of expedited arbitration, which involves the government assigning an
arbitrator and imposing specific time limits for the hearing and the issuance of a decision.6
Nowadays, reflecting the growing legalism in labour arbitration, the vast majority of arbitra-
tors are lawyers, but this is not a formal job requirement. It is also common for the parties to
retain lawyers to present their cases, although human resource or industrial relations managers
sometimes represent employers, and unions often use their own employees (staff or business
representatives) to present the union’s case.
The arbitration takes place in a private conference room rather than a courtroom. In many
respects, an arbitration hearing resembles a courtroom trial: witnesses testify and the parties’
representatives make opening statements and closing arguments, like in a trial. The hearing
proceeds in the general order described in Box 36.3. However, labour arbitration is less formal
than a trial. For example, Canadian collective bargaining legislation permits arbitrators to
accept evidence that would not be allowed by a court,7 such as hearsay evidence, although
arbitrators are nevertheless cautious in relying on such evidence and the courts have overturned
arbitration awards that relied on hearsay evidence as the basis for critical factual findings.8 Simi-
larly, arbitrators are not legally bound by the principle of stare decisis, as are judges (see
Chapter 1).9 However, they nevertheless strive for consistency of legal reasoning and predict-
ability and, therefore, representatives of unions and employers usually reference previous arbi-
tration rulings in their closing arguments in the same manner lawyers in the courts cite case law
to judges to bolster their arguments. As a consequence, there is a vast body of labour arbitration
decisions that acts as a sort of “common law of the shop.”10

The Labour Arbitration Process
Opening Statement the grievance. The rationale for this exception is that the em-
Both parties’ representatives briefly describe the issues in- ployer is in the best position to explain to the arbitrator its
volved in the grievance and the party’s position. decision to discipline an employee or terminate the
employee.
Order of Proceeding and Burden of Proof
The general rule is that the party that filed the grievance pro- Evidence
ceeds first, and the onus is on that party to prove, on a standard Evidence in support of the parties’ arguments is presented.
of a proof of “balance of probabilities,” that a breach of the Evidence takes three basic forms:
collective agreement has occurred.
The main exception to that general rule relates to griev- 1. Documentary evidence.
ances alleging that there has been discipline or discharge 2. Oral testimony by witnesses.
of an employee without “just cause.” In those cases, the em- 3. Agreed statements of fact.
ployer usually must proceed first, even though the union filed
expedited arbitration: A form of labour arbitration with strict time deadlines intended to ensure the parties can receive a
decision expeditiously.
hearsay evidence: Evidence given by a person based on second-hand knowledge rather than their own direct knowledge
or observations.
stare decisis: A Latin term meaning “to stand by a previous decision.” It is a guiding principle in the common law regime.

When a party calls a witness, that party asks the witness employer and union representatives. Those statements sum-
questions first (direct testimony), and then the other party marize the key evidence the party is relying on and explain the
gets to ask the witness questions (cross-examination testi- legal rules they want the arbitrator to apply. As noted above,
mony). After cross-examination testimony, the first party is it is common for the representatives of the parties during clos-
permitted to ask questions to clarify new evidence arising from ing arguments to refer to other arbitration case law involving
the cross-examination (“reply evidence”). The arbitrator may similar facts and legal issues.
also ask questions of any witness.
Closing Argument
Once the parties have finished presenting their evidence, the
arbitration hearing concludes with closing statements from the
IV. The Labour Arbitration Decision

After the hearing, the arbitrator writes a decision and sends it to the parties. In the case of a
three-person labour arbitration board, the decision of the majority governs, which in practice
often means that the neutral person casts the deciding vote (although sometimes panel decisions
are unanimous). That decision will summarize the facts, explain the arbitrator’s reasoning, and
set out the remedy, if any. Many arbitration decisions are recorded in the case law reporter
known as Labour Arbitration Cases (LAC) and now in free electronic databases such as CanLII,
which we have referenced throughout this text.11 Decisions are also summarized in books
including, most notably, Canadian Labour Arbitration (known in the field simply as “Brown and
Beatty” after the surnames of the original authors).12
An arbitrator’s decision is “final and binding” on the parties and employees affected by the
decision, subject to the right of the parties to apply to the courts for judicial review of the deci-
sion (and in British Columbia, a right to “appeal” to the BC Labour Relations Board).13 Judicial
review is the means by which courts supervise the labour arbitration regime. It requires judges
to ensure that arbitrators have not exceeded the authority granted them by statute or the parties
in the collective agreement. The law of judicial review is complicated and falls within an area of
law known as administrative law. For our purposes, it is sufficient to note that judges afford
arbitrators considerable deference in their interpretations of collective agreements and
employment-related statutes, including human rights legislation, because arbitrators are experts
in the field.14 As long as the arbitrator’s decision is one that a reasonable arbitrator could come
to, a court will usually uphold the arbitrator’s decision. The courts give arbitrators less deference
on decisions that fall outside the arbitrator’s principal area of expertise, such as decisions apply-
ing the Charter of Rights and Freedoms or human rights legislation.15
V. Labour Arbitration Remedies

Labour arbitrators have broad authority to provide effective remedies for a violation of the col-
lective agreement.16 That authority derives from the requirement found in collective bargaining
direct testimony: Evidence given by a witness called by the party doing the questioning. Leading questions are usually not
permitted.
cross-examination testimony: Evidence given by a witness during questioning by the party that did not call that witness.

legislation that arbitration provide a “final and binding” decision to resolve disputes without
work stoppages.17 According to the Supreme Court of Canada, “[a]rming arbitrators with the
means to carry out their mandate lies at the very core of resolving workplace disputes.”18 The
same “make-whole” principle considered in our examination of common law remedies for
breach of the employment contract (see Chapter 16) guides the crafting of remedies in labour
arbitration. Arbitrators are looking to place the aggrieved party back to the position they would
have been in but for the violation, insofar as that is possible. Therefore, in addition to issuing
“declarations” that a collective agreement breach has occurred and ordering the offending behav-
iour to cease, an arbitrator can order a number of other remedies, including the following:19
• damages for harm suffered due to the breach of a collective agreement: for example, lost
wages and benefits or, in the case of a union violation (e.g., an unlawful strike), damages
for lost profits or revenue;20
• aggravated damages (for mental suffering) or punitive damages (in narrow
circumstances);21
• the removal of discipline from an employee’s personnel records;
• damages for the commission of a tort (when, applying Weber, the dispute arises under
the collective agreement);22
• awarding an employee a job they were denied, contrary to the collective agreement
• an apology, in narrow circumstances;23
• reinstatement for an employee dismissed in contravention of the collective agreement,
perhaps with a lesser form of discipline, such as an unpaid suspension of a fixed
duration; and
• Charter of Rights remedies, including a declaration that a term in a collective agreement
between a government employer and a union violates the Charter; declaration that a
statutory provision that violates the Charter is unenforceable insofar as it applies to the
collective agreement parties; and damages resulting from a Charter violation (an arbi-
trator cannot declare legislation invalid, as can a court).24
VI. The Expanding Scope of Labour Arbitration

In its early days, back in the 1940s and 1950s, labour arbitration was intended to be a relatively
informal, non-legalistic, expedient, and inexpensive alternative to courtroom litigation. The
parties often abstained from using lawyers and presented their cases to an arbitrator in an in-
formal manner, sometimes without calling witnesses. Arbitrators wrote brief decisions that were
practical and written in plain and simple language. They believed that the scope of their au-
thority was confined to interpreting and enforcing the terms of the collective agreement under
which they were appointed. They did not see it as their job to enforce statutes; other adminis-
trative tribunals had been assigned that role by the government. Certainly it was not their job
to hear cases that raised common law causes of action, such as torts; the common law was the
domain of the courts. Arbitrators envisioned a solid line between the three regimes of work law
(see Chapters 1 and 2) and perceived their role to be a limited one—enforcing the collective
agreement the parties had negotiated.
However, early arbitrators recognized that a fundamental difference exists between contract
disputes in unionized and non-unionized workplaces. Unlike in the case of individual employ-
ees who sue their employers for “wrongful dismissal” in the common law regime after the
employment relationship has already ended, unions and employers usually must live with one
another indefinitely into the future. The ongoing relationship matters, so arbitrators sometimes
acted more like marriage counsellors than divorce court judges, searching for resolutions to
conflict that were not overly legalistic, but made practical industrial relations sense and pro-
moted future harmonious relations between employers, unions, and employees.25

By the 1970s, labour arbitration had begun to experience what some scholars called “creeping
legalism.”26 The parties began to use lawyers more frequently to present their cases. Lawyers are
more prone to raise technical legal arguments, which leads to longer (and therefore more expen-
sive) hearings and to more legalistic and lengthy decisions that take arbitrators longer to write.
Furthermore, over the past 20 years, the scope of issues that arbitrators are expected to decide
has expanded dramatically. Two key Supreme Court of Canada decisions in particular facilitated
this expansion: Weber v. Ontario Hydro (1995) and Parry Sound (District) Social Services Admin-
istration Board v. O.P.S.E.U., Local 324 (2003).
In the Weber case, a unionized employee (Weber) of Ontario Hydro, a public energy com-
pany, was off work with a disability when the employer engaged a private investigator to spy on
him at home.27 The employer believed Weber was not really unable to work. The investigator
tricked Weber to gain access to his home. Relying on the investigator’s report, the employer
suspended Weber for abusing the sickness benefits. Weber filed a grievance alleging no “just
cause,” and also filed a lawsuit against the employer in court alleging a variety of torts (deceit,
trespass, nuisance) as well as a violation of his Charter rights that entitled him to be free from
unreasonable search. The grievance was settled, and the lawsuit was dismissed by the courts on
the basis that the issues involved arose out of the collective agreement and all such issues must
be resolved through the grievance and arbitration procedure in the collective agreement. Weber
(and his union) appealed that ruling to the Supreme Court of Canada.
The Supreme Court ruled that the lawsuit could not proceed. It found that if the “essential
character” of a dispute arises either directly “or inferentially” out of the interpretation, applica-
tion, or administration of a collective agreement, then the mandatory arbitration provisions in
the collective bargaining legislation require that dispute to be resolved through the grievance
and arbitration provisions of the collective agreement and not the courts.28 The justification for
this extension of labour arbitrators’ jurisdiction was to promote a single forum for resolution of
disputes in unionized workplaces. However, the vagueness of the legal test—When does the
“nature of a dispute” arise “inferentially” from a collective agreement?—spawned hundreds of
cases by employers, employees, and unions to sort out exactly when a lawsuit was blocked by
the newly expanded exclusive jurisdiction of labour arbitration.29
The next important decision that expanded the scope of labour arbitrators’ jurisdiction was
decided in 2003. The Parry Sound decision addressed the question of whether arbitrators have
the authority—and the legal responsibility—to interpret, apply, and enforce employment-related
statutes, such as employment standards and human rights legislation, in the course of interpret-
ing collective agreements.30 The issue before the Supreme Court was whether a collective agree-
ment incorporates human rights legislation (see Box 36.4). If yes, a complaint by a unionized
employee alleging a human rights violation would fall within an arbitrator’s jurisdiction.

Are Labour Arbitrators Required to Apply Human Rights Statutes When They Interpret
Collective Agreements?
Parry Sound (District) Social Services Administration in the collective agreement. The agreement provided that a
Board v. O.P.S.E.U., Local 324 probationary employee could be dismissed “at the sole discre-
2003 SCC 42 tion” of the employer and that such action could not be the
subject of a grievance. Nevertheless, the union filed a griev-
Key Facts: O’Brien, a counsellor, was dismissed upon returning ance and argued that the decision to dismiss O’Brien was re-
from maternity leave but within a probationary period defined lated to her maternity leave and therefore a violation of the

Ontario Human Rights Code. The arbitrator ruled that since the The obligation of an employer to manage the enter-
Labour Relations Act, 1995 required arbitrators to “apply human prise and direct the work force is subject not only to
rights and other employment-related statutes” when they in- express provisions of the collective agreement, but
terpret the collective agreement, the arbitrator must consider also to the statutory rights of its employees, includ-
whether the employer violated the Human Rights Code when ing the right to equal treatment in employment
it terminated O’Brien’s employment contract. The employer without discrimination. … [Arbitrators] have not
sought judicial review, arguing that since the collective agree- only the power but also the responsibility to imple-
ment expressly provided that dismissing a probationary em- ment and enforce the substance rights and obliga-
ployee could not be the subject of a grievance, the arbitrator tions of the human rights and other
had no authority (jurisdiction) to hear the grievance. employment-related statutes as if they were part of
the collective agreement.
Issue: Are the terms of the Human Rights Code effectively in-
corporated into collective agreements such that an arbitrator The court ruled that management rights must be exercised
must apply the Code to the interpretation of the collective in a manner that does not violate a term of the collective
agreement? agreement or provisions in employment-related statutes.
Decision: Yes. The Supreme Court of Canada agreed with the Granting arbitrators the right to apply and enforce statutes
arbitrator. It ruled that the prohibition on discrimination in that govern employment is consistent with the overriding
employment in the Human Rights Code was incorporated into policy of mandatory labour arbitration, which is to promote
the collective agreement. Therefore, an allegation that the industrial peace by allowing for an expeditious and relatively
employer discriminated against O’Brien is an allegation that inexpensive dispute-resolution forum. The grievance falls
the collective agreement had been violated, and that dispute within the jurisdiction of the arbitrator.
falls within the jurisdiction of the arbitrator. The Supreme
Court wrote:
The Parry Sound decision ruled that employment-related statutes are incorporated into col-
lective agreements, and therefore arbitrators must enforce those statutes when deciding collec-
tive agreement disputes.31 This does not necessarily mean that unionized employees cannot file
complaints directly under a statute rather than file a grievance. That choice depends on an
assessment of the nature of the issue in dispute and whether the government intended that
unionized employees be required to pursue their statutory complaints exclusively through the
labour arbitration process under a collective agreement. For example, some employment stan-
dards statutes (e.g., in Ontario and British Columbia) expressly require unionized employees to
pursue the grievance arbitration route rather than file a complaint with an employment stan-
dards tribunal.32 On the other hand, unionized employees usually are not prohibited from filing
human rights complaints directly with human rights tribunals, because labour arbitrators
and human rights tribunals have “concurrent jurisdiction” (they both have the authority) to hear
complaints alleging human rights violations.33 However, human rights tribunals can refuse to
hear a complaint filed by a unionized employee if that complaint has already been dealt with by
a labour arbitrator.34 You can see in this discussion how the lines between the three regimes of
work law can sometimes become blurred.
The combined effect of Weber and Parry Sound is that labour arbitration has expanded
beyond its original narrow role of interpreting and enforcing collective agreements. The borders
between the three regimes of work law have been blurred at the intersection of labour arbitra-
tion. Modern labour arbitrators are expected to be experts not only in collective agreement in-
terpretation but also in the common law, statutory law, and even Charter jurisprudence. That is
a lot to ask, and there is considerable debate about whether labour arbitration is better or worse
for the extended workload it has been asked to carry, as Ontario Chief Justice Warren Winkler
discusses in Box 36.5.


Is the Expanded Scope of Labour Arbitration Undermining the Original Purpose of the Model?
In the following excerpt, Warren Winkler, former chief justice
of Ontario and a labour lawyer, discusses the changing role of
labour arbitrators.* Consider what events Justice Winkler iden-
tifies as the cause of this change, and his opinions on whether
the changes have been beneficial.
My thesis is that labour arbitration as we know it …

has lost its course, has lost its trajectory, has lost its
vision. It is at risk of becoming dysfunctional and
irrelevant. … Labour arbitration was intended to be
a procedure through which disputes could be re-
solved in a timely way, on the merits, in an affordable
fashion, and with finality. But since the end of what
I call the “golden age” of labour arbitration, which
spanned the period from roughly 1944 to 1967/68,
it has lost its sense, its vision, and has gone off the
rails. …
[In the golden age] the parties would appear and
present their cases, and this was a non-adversarial,
non-acrimonious type of proceeding. The usual pro-
Warren Winkler, former Chief Justice of Ontario.
cess was that the parties would print up their sub-
Source: Reprinted with the permission of the Honourable Warren Winkler.
missions in a brief; it would be short, and it would
contain evidence. This evidence would often conflict,
but nobody worried about that. There were fre-
quently no witnesses called, there were no cross- The second factor that brought this golden age of
examinations. There was no acrimony because it was labour arbitration to an end was the extension of
non-adversarial. People showed up and presented jurisdiction of labour arbitrators. This was an incre-
these cases, which were short and over with mental process; it did not happen all at once; nor did
quickly. it happen because of any one single event or inci-
… While managers represented the interests of dent. Even so, there were certain highlights that one
employers at collective bargaining, in arbitration can point to that I think are indicators of what
they were principally motivated by sound labour happened.
relations and a non-adversarial approach. This non-
adversarial and non-acrimonious perspective per- Justice Winkler explains that the first highlight was a 1959
meated everything and made the system work as arbitration decision by Professor Bora Laskin (as arbitrator) that
successfully as it did. There was none of the litigious- expanded the authority of arbitrators to issue remedies for any
ness that followed in later decades; it was most violation of a collective agreement.† He continues:
common to have no lawyers involved so that neither
the nominee nor the presenter would be a lawyer. I The next really important case was Weber v. Ontario
characterize it as something of a “golden age” of Hydro in 1995. In this case, Weber had been under
labour arbitration, because it was. surveillance because he was thought to be a malin-
gerer by Ontario Hydro, and finally he sued them. …
Justice Winkler next turns to the reasons why this “golden [T]he Supreme Court said “no.” You must look at the
age” of labour arbitration came to an end. The first change was nature of the dispute and then look at the four cor-
a law passed in 1967 that prohibited judges from acting as ners of the collective agreement in order to deter-
labour arbitrators. Judges, who had decided most arbitrations mine whether or not this dispute fits into that
to that point, were replaced in large measure by law professors. employment-related collective agreement. If the an-
Those professors were smart but they also began a movement swer to that is yes, then it goes there exclusively, and
toward a more legalistic approach to arbitration. Their deci- it goes to arbitration; it does not go to the civil courts.
sions were lengthier, read more like court decisions, and took What has been the effect of Weber? It has been
longer to be issued. enormous … . This was seen as a case that was

outside the boundaries—because until this point in the case. They did not care whether one party or the
time everyone had argued … that arbitrators can deal other was upset in the workplace. If they were upset,
with issues involving the interpretation, administra- the attitude was “Well, let them be upset.” The arbi-
tion, or application of the collective agreement. … tration process changed from one that was industrial
… Weber moved cases such as those related to relations based to one that was litigation based. This
workplace assaults or defamation into the arbitra- change drove a wedge between the arbitration pro-
tion process. These were traditionally civil court law- cess and the labour relations in the plant, and it
suits that, until then, no one thought would come drove a wedge between the parties in such a way
within labour arbitration, with a possible remedy of that they did not relate any more. This disconnect
awarding damages. This was a sea change because proved to be immensely harmful. …
it altered the whole concept and notion of labour The other aspect of this development was that
arbitration. … when winning or losing becomes the main focus,
The next major development came with Parry the parties then have to be careful about who is
Sound Social Services Administration v. OPSEU, which chosen as an arbitrator. Each side has to give it their
was a case where a probationary employee gets best shot, so the list of who is acceptable becomes
dismissed. There is a probationary employee clause, a pretty skinny list. Often, this meant choosing the
so that if you are a probationary employee, you can- busiest people, because each side felt they needed
not seek arbitration. This case goes to the Supreme to have the people who would give them their best
Court of Canada; they go back and read section 48 chance—even a 1 percent better chance, because
(12) (j) of the [Ontario] Labour Relations Act that says winning meant everything. Choosing busy people
the Human Rights Act or any other industrial rela- led, in turn, to significant delays in hearing. This
tions – type statute can be arbitrated even if it is in- was an incremental, gradual, but steady change in
consistent with the collective agreement. All of a process. …
sudden, cases that used to go someplace else go to The outcomes now also reflect the changed tra-
labour arbitration. … jectory. Now the hearing can take a year and a half
These three cases effectively created a new world or two years, with several adjournments, and it is so
because the sphere of the kinds of cases that, by technical that nobody can understand the issues,
subject matter, arbitrators could resolve was hugely which are not decided on the merits but with deci-
expanded, and I would say for the better, because it sions thirty-five pages long issued six months later.
meant a holistic approach. … This is not labour arbitration; it is labour
The third major factor was a cultural change in dysfunction.
the conduct of labour arbitration. Starting in the
mid-1960s, the whole idea of an industrial rela- * W. Winkler, “Labour Arbitration and Conflict Resolution: Back to Our
tions – based arbitration process began to shift over Roots” (lecture, Don Wood Lecture Series, Queen’s University, Kingston,
to a litigation-based arbitration process. Ontario, 2010), online (pdf ): <http://irc.queensu.ca/sites/default/files/
articles/dwls-2010-warren-k-winkler-labour-arbitration-and-conflict-
Originally, the parties worried about whether or
resolution-back-to-our-roots.pdf>. Reprinted with the permission of the
not the labour arbitration process would enhance, Honourable Warren Winkler.
foster, and benefit industrial relations in the plant.
† Re Oil, Chemical and Atomic Workers International Union, Local 16-14 and
This changed so that now you had the emergence Polymer Corporation Ltd. (1959), 10 LAC 51, aff’d 26 DLR LAC 51, aff’d 26
of a group of people who were not worried about DLR (2d) 609 (Ont. H Ct J).
that at all; instead, they were worried about winning
VII. What Is “Just Cause” for Discipline or Dismissal in Unionized

Workplaces?
In Part II of this text, we learned that a non-union employer can usually terminate an employ-
ment contract simply by providing notice to the employee. Alternatively, as Chapter 12 explained,
a non-union employer can dismiss an employee with no notice, but only if there is cause for
summary dismissal. In a unionized workplace, the right of the employer to dismiss an em-

ployee simply by providing notice does not usually exist. That is because either the collective
agreement or a collective bargaining statute requires the employer to have “just cause” to dismiss
or discipline a unionized employee. Therefore, unionized employees in Canada have a greater
legal claim to continued employment than do non-union employees governed by the common
law regime.
A. The Basic Building Blocks of “Just Cause” Arbitration Law

In some provinces, the collective bargaining statute imposes an obligation that all collective
agreements include a provision requiring the employer to demonstrate “just cause” for disci-
pline or dismissal of an employee.35 However, even where inclusion of a just cause provision is
not expressly required by a statute, the parties agree to one almost all of the time.36 A just cause
provision is one of the most important benefits unions negotiate, and it fundamentally trans-
forms the legal treatment of discipline and dismissal that exists in the common law regime. Over
time, labour arbitrators have developed an extensive body of jurisprudence that develops the
core principles of what constitutes “just cause.”
In some respects, the legal tests applied by arbitrators in deciding whether a unionized em-
ployer has just cause to discipline or dismiss an employee
are similar to the tests applied by the courts in assessing
whether a non-union employer has cause for summary
dismissal in the common law regime (see Chapter 12).
Sometimes, labour arbitrators rely on common law deci-
sions, which should not be surprising, since as we have
noted on many occasions throughout this text, the three
regimes of work law interact and influence one another
(see the discussion of the “internal feedback loop” in
Chapter 2). To provide one example, labour arbitrators
regularly reference and apply the “proportionality test,”
which was recognized by the Supreme Court of Canada
in McKinley v. BC Tel (described in Box 12.1) in cases of
dishonesty involving unionized employees.37
However, for the most part, arbitrators have formed
their own legal tests in developing the law of just cause,
as Professor Harry Arthurs explained in a 1967 arbitra-
tion award:
Whatever may have been the early views of labour arbitrators, it is common knowledge that over the
years a distinctive body of arbitral jurisprudence has developed to give meaning to the concept of
“just cause for discharge” in the context of modern industrial employment. Although the common
law may provide guidance, useful analogies, even general principles, the umbilical cord has been
severed and the new doctrines of labour arbitrators have begun to lead a life of their own.38
In the 50 years since Arthurs made that observation, labour arbitrators have developed more
sophisticated and complex legal doctrines, some of which we will now explore.
1. The William Scott Three-Step Analysis

Let’s begin with the seminal 1977 case of Wm. Scott & Company Ltd. v. Canadian Food and Allied
Workers Union, Local P-162 (see Box 36.6). This case introduced a three-step analysis for dealing
with discipline and dismissal cases under collective agreements with a just cause provision. The
legal test developed is more important than the details of the specific facts in the case.
just cause provision: A term in a collective agreement between a union and an employer that requires the employer dem-
onstrate “just cause,” or a good business reason, to discipline or dismiss an employee.


The William Scott Test
Wm. Scott & Company Ltd. v. Canadian Food and Allied minate a person’s employment simply with notice
Workers Union, Local P-162 or pay in lieu of notice. Employment under a collec-
(1977), 1 CLRBR 1 (BCLRB) tive agreement is severed only if the employee quits
voluntarily, is discharged for cause, or under certain
Key Facts: A unionized employee called a newspaper and al- other defined conditions (e.g., absence without
leged that her employer was very inefficient. Wm. Scott & leave for five days; lay-off without recall for one year,
Company, the employer, dismissed the employee, relying on and so on). As a result, an employee who has served
this incident as well as a recent prior one-year suspension for the probation period secures a form of tenure, a legal
serious misconduct. The termination was upheld by a labour expectation of continued employment as long as he
arbitrator, who ruled that the employer had “just cause” to gives no specific reason for dismissal. … At the same
discharge the employee. The union appealed to the BC Labour time, the standard collective agreement also pro-
Relations Board, which had authority to review arbitration vides the employer with a broad management right
decisions. The union argued that the employee’s comments to to discipline its employees. If an individual em-
the newspaper were true, that there was nothing vindictive ployee has caused problems in the work place, the
about her actions, and that there wasn’t just cause. employer is not legally limited to the one, irrevers-
Issue: Did the arbitrator make an error in deciding that the ible response of discharge. Instead, a broad spec-
employer had “just cause” to terminate the employee? trum of lesser sanctions are available: verbal or
written warnings, brief or lengthy suspensions, even
Decision: No. The BC Labour Board explained how the ap- demotion on occasion … Because the employer is
proach to discipline and discharge in the collective bargaining now entitled to escalate progressively its response
regime differs from that in the common law regime: to employee misconduct, there is a natural inclina-
tion to require that these lesser measures be tried
Without reviewing the common law … in any detail,
out before the employer takes the ultimate step of
suffice it to say that the [non-union] contract of
dismissing the employee, and thus cutting him off
employment allowed the employer to dismiss an
from all of the benefits associated with the job and
employee without notice for cause (some relatively
stemming from the collective agreement.
serious forms of misconduct which, in the eyes of
the law, made the continuance of the employment The board then instructed arbitrators to pose the following
relationship undesirable). But that particular doc- three distinct questions in a typical discharge grievance alleg-
trine of the common law can be appreciated only in ing no just cause:
light of two other features of the master-servant
relationship. First of all, even in the absence of cause 1. Has the employee given just and reasonable cause for
on the part of the employee, the employer could some form of discipline by the employer?
unilaterally dismiss an employee with reasonable 2. If so, was the employer’s decision to dismiss the em-
notice, or with pay in lieu of notice. This meant that ployee an excessive response in all of the circum-
employees had no legal expectation of continuity stances of the case?
of employment even if their performance was satis- 3. Finally, if the arbitrator does consider discharge exces-
factory and work was available. Secondly, if an em- sive, what alternative measure should be substituted
ployee was guilty of some misconduct at work, the as just and equitable?
employer had no other form of discipline available.
The contract of employment did not entitle the em- In this particular case, the board upheld the arbitrator’s
ployer to suspend the employee, for example. decision that the employee’s misconduct warranted discharge
[In the collective bargaining regime] an em- considering the employee’s prior disciplinary record.
ployer no longer retains the unilateral right to ter-
The three questions posed in the William Scott decision have guided labour arbitrators deal-
ing with both dismissal and discipline cases ever since. The employer must establish the employ-
ee’s misconduct on a standard of “balance of probabilities” (that it is more likely than not that
the misconduct occurred) by presenting “clear and cogent” evidence that establishes the em-
ployee committed the alleged misconduct.39 In many cases, the answer to question one is fairly
straightforward—it is clear that the employee has engaged in misconduct deserving of some

discipline—but not always. For example, there may be a factual disagreement about whether
the employee actually engaged in the conduct alleged at all, or a legal dispute about whether the
conduct was actually a violation of the collective agreement. If the answer to question one is
“no”—there are no grounds for any discipline—then the grievance will be upheld.
2. Mitigating Factors and Progressive Discipline

If the answer to question one is “yes,” then the arbitrator will turn to questions two and three in
the William Scott test. In deciding whether the employer’s chosen response was appropriate,
arbitrators consider a range of mitigating circumstances or factors that paint a more complete
picture of the employee’s behaviour and personal circumstances.40 Those mitigating factors are
described in Box 36.7. Among the most important factors are the employee’s length of service
and prior disciplinary history. A long-service, good employee acquires a stronger claim to their
job than does a relatively new employee or an employee with prior discipline who has been given
an opportunity to improve their performance but has failed. As part of their case to the arbi-
trator, unions and employers will enter evidence of those mitigating factors, which they hope
will influence the arbitrator’s decision on whether the employer’s selected discipline was appro-
priate and, if not, what lesser penalty should have been imposed.

Mitigating Factors in Labour Arbitration
In assessing questions two and three of the William Scott test, • What, if any, prior discipline has been imposed on the
arbitrators consider a large range of mitigating factors relating employee, and for what reason?
to the incident, the employee’s work history, and the employ- • Does the employee’s previous disciplinary record sug-
ee’s personal circumstances. gest a high or low risk of reoffending?
• Was there a recent change in job duties or the work en-
Factors Relating to the Incident vironment that played a role in the employee’s
• Was the incident premeditated or an uncharacteristic behaviour?
spur-of-the-moment act?
• Was there an intention to do harm or violate a rule? Factors Relating to the Employee’s Personal Circumstances
• How serious was the incident, in terms of harm to the • Did the employee apologize or express remorse for
employer or risk to health and safety? their misconduct?
• Was the employee provoked? • Are there any personal factors that might have contrib-
• How has the employer responded to similar behaviour uted to or help explain the employee’s behaviour
by other employees in the past? (unusual stress, disability, marriage or other family
• Was it obvious or known to the employee that the problems, etc.)?
behaviour was unacceptable? (That is, was there a clear • What would be the personal and economic impact
employer policy known to the employee?) on the employee of losing their job? (For example,
does the employee have dependants? Is the employee’s
Factors Relating to the Employee’s Work History age or skill level such that it will be particularly difficult
• What is the employee’s length of service? to find new employment?)
mitigating circumstances/factors: Personal or workplace-related factors that, while not directly the cause of an employee’s
behaviour, help explain or justify an employee’s behaviour.

As noted in the Wm. Scott decision, progressive discipline plays an important role in labour
arbitration, along with the associated doctrine of culminating incident, a common law doctrine
adopted by arbitrators (discussed in Chapter 12).41 Unless the employee’s misconduct is particu-
larly egregious, arbitrators expect the employer to have exhausted lesser forms of discipline,
including warnings and suspensions, before they will uphold a termination. The importance of
progressive discipline in labour arbitration motivates many unionized employers to introduce
or negotiate clear progressive discipline guidelines. For example, guidelines might specify that
a first offence will result in a written warning, the second offence in a one-day suspension, the
third offence in a three-day suspension, and the fourth offence in termination. There would
usually be an exception for very serious misconduct, permitting the employer to immediately
discharge the employee and bypass the progressive steps. Some collective agreements include
sunset clauses, which require the employer to remove discipline from an employee’s file and
prohibit the employer from relying on the discipline in the future after a specified discipline-free
period of time has passed.42
3. Remedial Authority of Arbitrators in Discipline and Discharge Cases

The third question in the William Scott test requires the arbitrator to step into the shoes of the
employer and decide what discipline is appropriate in the circumstances. This can involve sub-
stituting a lesser form of discipline than that imposed by the employer: a suspension of some
length can be substituted for a termination; a shorter suspension can be substituted for a longer
suspension; a warning can be substituted for a suspension, and so on. Contrast the right of
unionized employers to suspend employees without pay to the situation of the common law
non-union employer. In the common law regime, an unpaid suspension is a breach of contract
that an employee can treat as a “constructive dismissal,” unless the employment contract grants
the employer a right to suspend (and most do not). Collective agreements, in contrast, almost
always confer a right to suspend as a form of discipline on unionized employers.
Question three requires the arbitrator to substitute their own view for that of the employer.
The authority for an arbitrator to do that is found in collective bargaining legislation, such as
section 48(17) of the Ontario Labour Relations Act, 1995, which is typical:
Where an arbitrator or arbitration board determines that an employee has been discharged or other-
wise disciplined by an employer for cause and the collective agreement does not contain a specific
penalty for the infraction that is the subject-matter of the arbitration, the arbitrator or arbi-
tration board may substitute such other penalty for the discharge or discipline as to the arbitrator or
arbitration board seems just and reasonable in all the circumstances.43 [Emphasis added]
Note the reference in this section to a “specific penalty” found in the collective agreement. The
parties can agree to limit the discretion of the arbitrator by writing into the agreement that, for
a specific infraction, termination is the automatic penalty and the arbitrator lacks authority to
substitute a different penalty.44
When the discipline caused the employee to lose wages and benefits (suspensions and ter-
minations), the remedy may also be accompanied by a damage award. For example, if an arbi-
trator reinstates an employee with a three-month suspension and it has been eight months since
progressive discipline: The application in stages by employers of progressively more serious discipline to correct performance
problems.
culminating incident: The final breach of contract by an employee following progressive discipline that the employer relies
on to justify termination of an employee for cause.
sunset clause: A clause in a collective agreement or employment contract that wipes prior discipline from an employee’s
record after a specified period of discipline-free work.

the dismissal when the reinstatement takes effect, the damages to the employee include five
months’ pay and any benefits the employee would have received during that period. Note that
the duty to mitigate damages applies equally to unionized employees who are dismissed with-
out just cause and non-union employees who are wrongfully dismissed (see Chapter 12). There-
fore, an arbitrator may reduce damages owing to an employee if that employee earned alternative
income in the interim or failed to make reasonable efforts to find alternative employment.45
Reinstatement is a common remedy in labour arbitration, which contrasts sharply with the
situation in the common law regime, in which courts usually refuse to order specific perform-
ance (including reinstatement) of individual employment contracts (see Chapter 14). A study
by arbitrator Alan Ponak found that just over half of dismissed unionized employees are rein-
stated by arbitrators. Of those reinstated, 80 percent receive a substituted lesser form of disci-
pline imposed by the arbitrator, while about 20 percent are reinstated without any substituted
penalty.46 Employees who are reinstated tend to perform well, and only a small proportion end
up being dismissed again. Although reinstatement is the normal remedy when a dismissal is
ruled to be without just cause, an arbitrator may decide that reinstatement is not an appropriate
remedy and order damages instead, similar to how courts remedy wrongful dismissals in the
common law.47
B. Summary of Specific Grounds for Discharge and Discipline

Having described the basic principles used by arbitrators when applying “just cause” provisions
of collective agreements, we can now quickly consider their specific application to a variety of
types of (alleged) employee misconduct. There are thousands of labour arbitration decisions
interpreting and applying “just cause” provisions and many books examining the law of just cause
in detail. Many arbitration decisions can now also be found online, as explained in Box 36.8.

Finding Labour Arbitration Case Law
The leading publication in which to find labour arbitration case 3. Under “Boards and Tribunals,” select “Labour Arbitration
law is Labour Arbitration Cases (LAC).* This series can be found Awards.”
in many academic libraries and is available electronically with
a licence that many university and college libraries purchase. Unfortunately, you need to do the same search for each
In recent years, CanLII has also begun to post labour arbitration jurisdiction if you want a national search, since there is no
decisions. Here is how to do a CanLII search of just labour arbi- single database that includes all labour arbitration decisions
tration decisions: for the entire country.
1. Go to the CanLII home page: <https://www.canlii.org>. * D. Brown & D. Beatty, Canadian Labour Arbitration, 4th ed (Aurora, ON:
2. Under the “Primary law” heading, select a jurisdiction Canada Law Book, 2006). See also R. Snyder, Collective Agreement
(Ontario, Alberta, etc.). Arbitration in Canada, 5th ed (Markham, ON: LexisNexis, 2013) at 532-36;
and M. Mitchnick & B. Etherington, Labour Arbitration in Canada, 2nd ed
(Toronto, ON: Lancaster House, 2013).
reinstatement: A legal remedy issued by a court of administrative tribunal (including an arbitrator) ordering an employer to
re-employ an employee it had terminated in violation of a contract of service.
specific performance: An order by a court requiring a party found to have breached a contract to carry out its obligations
as specified in the contract.

Our aim here is to give you a flavour for the extensive body of arbitration case law. Table 36.1
provides a quick snapshot of the most common forms of employee misconduct leading to dis-
cipline and how labour arbitrators assess whether the employer had “just cause” to impose the
discipline it chose.
TABLE 36.1 Grounds of Discipline and Approaches Taken
Grounds of Discipline/Dismissal Summary of Approach Taken by Labour Arbitrators

for Just Cause
Arbitrators apply the William Scott test, asking first whether there are grounds for any discipline and then, if so, whether a lesser penalty
than the one imposed by the employer should be substituted.
Dishonesty The “proportionality test” is applied, as in common law summary dismissal cases.
Dishonesty is serious, but arbitrators consider all of the circumstances, including mitigating
factors.
Poor Work Performance “Culpable” poor performance is blameworthy and may result in discipline. Arbitrators expect
employers to apply progressive discipline that warns an employee of problems and gives them
time to improve. “Disciplinary demotion” is a possible response.
“Non-culpable” poor performance is not blameworthy. Discipline is not an appropriate response,

but the employer can still demote, transfer, or terminate an employee for incompetence if they
satisfy the test described in Edith Cavell Private Hospital (see Box 36.11).
Insubordination Discipline is justified if there was a clear order issued by a person in authority that the
employee disobeyed. Employees who disagree with an order must “obey now, grieve
later.” There are some exceptions in which an employee may refuse an unlawful
order.
Harassment and Workplace Violence While these grounds are considered serious, consistent with William Scott arbitrators weigh all the
relevant factors to assess if the employer’s punishment is justified.
Attendance Problems Culpable absenteeism and lateness are subject to discipline, but arbitrators expect
employers to apply progressive discipline. Non-culpable attendance problems (“innocent
absenteeism”) are not subject to discipline but may result in termination if the absence is
extended and there is no reasonable prospect of the person returning to work in the
foreseeable future.
Off-Duty Conduct Employers must satisfy the test from the arbitration decision in Millhaven Fibres (1967), which
emphasizes the extent to which the employee’s off-duty conduct threatens the employer’s
business interests.
Intoxication Reporting to work impaired is a serious work-related offence. The employer must establish
impairment and, as usual, all of the circumstances are considered by arbitrators in assessing the
appropriate penalty.
1. Dishonesty
Dishonesty—such as time theft48(including surfing the web for personal use at work instead of
working),49 property theft, falsification of records, and dishonesty (including on an application
form)50—is considered a serious workplace infraction because trust and confidence are at the
core of the employment relationship.51 At the same time, the Supreme Court of Canada noted in
time theft: When an employee falsely claims wages for time not actually worked.

McKinley v. BC Tel (see Box 12.1) that not every incident of dishonesty is so serious that it irrepa-
rably ruptures an employment relationship, and arbitrators have adopted that reasoning.52 Arbi-
trators consider all of the surrounding circumstances, including whether the dishonesty was
premeditated; whether there is a pattern of dishonesty; whether there was harm to the employer;
how serious the dishonesty was; whether the employee admitted the misconduct and expressed
remorse;53 and whether any other mitigating factors of the sort listed in Box 36.8 apply, especially
length of service and the employee’s disciplinary record.54 If the arbitrator finds that the dishon-
est behaviour occurred or the employee admits it, then questions two and three of the William
Scott test will focus on mitigating factors. Consider the case described in Box 36.9.

Is Theft of a Pack of Cigarettes Just Cause for Termination?
Canada Safeway Limited v. United Food and Commercial grievor’s story that he placed the cigarettes in his apron and
Workers Union, Local No. 832 then forgot about them was not credible. His demeanour in
2012 CanLII 97767 (Man. LA) the hearing was that of a person making up a story, and the
employer’s witnesses and video evidence, while not conclusive
Key Facts: The grievor was a 36-year-old cashier at Canada that the grievor stole the cigarettes, was consistent with the
Safeway in Manitoba. A co-worker reported to the employer employer’s theory that the grievor engaged in deception to
that the grievor was behaving suspiciously and that she be- first hide the cigarettes behind a cash register and then later
lieved he was stealing cigarettes. The employer conducted place them into his apron.
surveillance of the grievor, which led the employer to believe Having found that a theft occurred, the arbitrator then
the grievor had been deliberately slipping cigarettes into his considered whether dismissal was an appropriate penalty.
work apron. The grievor initially denied that he had done so Theft was a serious concern for a retailer like Canada Safeway,
when confronted by the employer, but later he claimed to have and employees knew it. For cashiers especially, the opportun-
found a pack of cigarettes in his apron when he got home. He ity for theft is high, and it is important that the employer be
claimed that he must have put the cigarettes in his apron with able to issue stiff penalties to deter it. The grievor had nine
the intention of returning them to the correct spot in the store separate disciplinary incidents on his employment record, the
but then forgot they were there and mistakenly brought the most serious resulting in a three-day suspension. The fact that
cigarettes out of the store. He was dismissed for theft. The the grievor failed to confess and apologize and instead fabri-
union filed a grievance cated a story caused the arbitrator to conclude that reinstate-
Issue: Did the employer have just cause to dismiss the grievor ment would be inappropriate. The dismissal was upheld.
for theft of a pack of cigarettes?
Decision: Yes. The arbitrator ruled that the employer had satis-
fied on a balance of probabilities that a theft occurred. The
A pack of cigarettes is worth only about $10, but it was enough to cost the employee in the
Canada Safeway case his job.55 However, in another Canada Safeway case, an arbitrator rein-
stated an employee who had consumed a drink from the store shelf, noting that the employee
had a clean service record for 35 years, that the theft was a “momentary aberration,” that there
would be “severe economic consequences” for the employee if the termination was upheld, and
that the employee admitted his guilt and apologized.56 The contrast in the outcomes of these
similar cases demonstrates the importance of mitigating factors in cases of employee
dishonesty.
2. Poor Performance and Incompetence

Arbitrators distinguish between “culpable” (blameworthy) poor performance and “non-
culpable” incompetence. Poor performance is culpable if it is due to carelessness, laziness,

inattentiveness, deliberate neglect or disregard, or neglect of safety rules. Discipline may be an

appropriate employer response to culpable performance problems.57 Arbitrators look for a pat-
tern of culpable performance problems, accompanied by progressively more serious warnings
and discipline issued by the employer, before they will affirm a termination for poor perform-
ance. Arbitrators accept that, in addition to written warnings and termination if there is just
cause, a temporary disciplinary demotion is a possible response by an employer to culpable
poor performance.58 A temporary disciplinary demotion has the corrective objective of bringing
home to the employee the urgency of improving their performance to avoid dismissal if
improvement does not occur.
Poor performance is considered non-culpable if it is due to the employee’s lack of physical or
mental capacity to perform the job at the standard the employer requires (often referred to as
incompetence); the employee is trying, but they just cannot meet the standard. Arbitrators
consider discipline to be an inappropriate response to non-culpable incompetence. Yet, arbitra-
tors recognize the right of employers to respond to non-culpable incompetence by imposing a
non-disciplinary demotion or transfer to put the employee in a job they are capable of perform-
ing, or (ultimately) by dismissing an employee who is unable to perform any available job.59
However, before employers can take such actions, they must satisfy criteria initially spelled out
in the 1982 arbitration decision of Re Edith Cavell Private Hospital, as discussed in Box 36.10.
These criteria roughly parallel the (non-union) “duty to warn” recognized by judges (see Chap-
ter 12) in the common law regime and are intended to ensure that the employee is given a fair
chance to learn the job and improve before they are demoted or dismissed.

When Can an Employer Dismiss an Employee for “Non-Culpable” Incompetence?
Sometimes employees lack the physical or mental capacity to (b) The employer must establish that the stan-
competently perform their job. Arbitrators have developed dard expected was communicated to the
standards to measure when termination of an incompetent employee.
employee is a “just” termination. The leading case is called Re (c) The employer must show that it gave reason-
Edith Cavell Private Hospital v. Hospital Employees’ Union, Local able supervision and instruction to the employee
180.* In his decision, Arbitrator Hope set out the following cri- and afforded the employee a reasonable opportun-
teria that an employer must satisfy before a dismissal for non- ity to meet the standard.
culpable incompetence will be considered “just”: (d) The employer must establish an inability
on the part of the employee to meet the requisite
It is not open to an employer alleging a want of job standard to an extent that renders her incapable of
performance to merely castigate the performance of performing the job and that reasonable efforts were
the employee. It is necessary that specifics be pro- made to find alternate employment within the com-
vided. An employer who seeks to dismiss an em- petence of the employee.
ployee for a non-culpable deficiency must meet (e) The employer must disclose that reasonable
certain criteria: warnings were given to the employee that a failure
to meet the standard could result in dismissal.
(a) The employer must define the level of job
performance required.
disciplinary demotion: A form of discipline in which an employee is transferred to a position of less prestige, responsibility,
or pay.
incompetence: Poor work performance by an employee that is non-culpable and not due to any deliberate malfeasance by
the employee, but to an inability to perform the job to a reasonable standard of competence.

Arbitrators have applied these criteria to both dismissals Alberta Union of Provincial Employees v. Lethbridge Community
and demotions for incompetence, and in recent years arbitra- College.†
tors have also sometimes required employers to satisfy the
criteria as a precondition to imposing a “disciplinary demotion” * Re Edith Cavell Private Hospital v. Hospital Employees’ Union, Local 180
as well as dismissal for “culpable” poor performance. This de- (1982), 6 LAC (3d) 229 (Hope).
velopment was endorsed by the Supreme Court of Canada in † Alberta Union of Provincial Employees v. Lethbridge Community College,
2004 SCC 28.
3. Insubordination and the “Work Now, Grieve Later” Rule

An employee who refuses to comply with an order of a superior may be committing the serious
disciplinary offence of insubordination. Insubordination is considered a serious infraction
because it undermines the fundamental presumption in work law that the employer is the boss
and the employee a subordinate.60 In order to find that insubordination has occurred, arbitrators
require the employer to establish the following: (1) that there was a clear order that the em-
ployee understood; (2) that the order was given by a person in authority; and (3) that the
employee disobeyed the order. Each of these requirements can give rise to controversy at an
arbitration hearing, and failure by the employer to establish any of them can result in the disci-
pline being overturned.61
Sometimes, employees may believe that the employer is ordering them to do something pro-
hibited by the collective agreement, and they may refuse to obey on that basis. For example, an
employer may order an employee to perform work that they do not usually perform, and the
employee may genuinely believe the collective agreement entitles them to refuse to do the work.
Can the employee refuse in that case?62 The answer is determined by a rule developed by labour
arbitrators known as work now, grieve later. According to this rule, an employee who believes
an employer’s direction violates the collective agreement must nevertheless comply with the
direction and then file a grievance to challenge it afterward. The basis for the rule was explained
in the often-cited 1944 American arbitration decision in Ford Motor Co. as follows:
... [A]n industrial plant is not a debating society. Its object is production. When a controversy arises,
production cannot wait for exhaustion of the grievance procedure. While that procedure is being
pursued, production must go on. And some one must have the authority to direct the manner in
which it is to go on until the controversy is settled. That authority is vested in Supervision. It must
be vested there because the responsibility for production is also vested there; and responsibility must
be accompanied by authority. It is fairly vested there because the grievance procedure is capable of
adequately recompensing employees for abuse of authority by Supervision.63 [Emphasis added]
Since an employee is required to comply with an order and then file a grievance challenging
the right of the employer to issue the order, it is possible that an employee could be “justly”
disciplined for refusing to comply with the order even though an arbitrator later decides that the
order itself violated the collective agreement.64
A variety of exceptions to the “work now, grieve later” rule have been recognized by arbitra-
tors, most of which deal with situations in which the harm to the employee could not adequately
be remedied in a future arbitration hearing. The most commonly recognized exceptions to the
“work now, grieve later” rule include the following:
work now, grieve later: A rule developed by labour arbitrators that requires an employee who believes the employer is
ordering him or her to do something in contravention of the collective agreement to do as directed and then file a grievance
later challenging the employer’s direction. There are some exceptions to this rule.

• Health and safety: The employee has a genuine belief that complying with the employer’s
order will put them or someone else in danger; the employee advised the employer of this
concern; the concern was a reasonable one; and the danger was sufficiently serious to
justify the refusal.65 See Box 36.11 for an example.
• Illegal employer orders: An employee cannot be punished for refusing to comply with an
order to perform an illegal act that would expose the employee to sanctions.66
• Union officials: An employee who is also a union official may refuse an employer’s
order when it is necessary to do so for the official to perform urgent union functions.
Employees who are also union officials (e.g., union stewards) are given greater latitude
to defy or challenge management when acting in their role as union officials, which
sometimes requires them to take an adversarial position.67
• Personal appearance: An employee may refuse to comply with a company rule regulating
personal appearance in cases where complying with the rule would unduly prejudice the
employee. For example, a rule requiring an employee to cut his beard or hair (particularly
if the hair is associated with religious beliefs) or to remove a tattoo would have a substan-
tial impact on the employee beyond the workplace, and related adverse effects on the
employee could not easily be remedied by an arbitrator. Therefore, an employee may be
permitted to refuse to comply pending the outcome of a grievance.68
• Medical examinations and privacy: Employees cannot be disciplined for insubordination
for refusing to subject themselves to medical exams ordered by the employer or to dis-
close private medical information to the employer. However, in some instances a refusal
to provide the employer with medical information may justify the employer in refusing
to permit an employee to return to work.69

Is Refusal to Perform Dangerous Work Insubordination?
Lennox Industries (Canada) Limited v. United Steelworkers Issue: Did the employer violate the Occupational Health and
of America, Local 7235 Safety Act and/or the collective agreement when it suspended
1999 CanLII 20394 (Ont. LA) the grievor?
Key Facts: The grievor worked on a production line and he Decision: Yes. First, the employer violated the Occupational
was seen speaking to a co-worker down the line, away from Health and Safety Act when it punished the grievor for exercis-
his workstation. A supervisor ordered the grievor to return ing the right to refuse unsafe work (see Chapter 24). The test
to his workstation and start working because the line was be- to exercise that right in the legislation is whether the grievor
ing held up. The supervisor then stood about one foot away had a “subjective belief of danger.” Clearly the grievor believed
from the grievor and intensely ordered him to get back to he was at risk of being cut in the circumstances. The legislation
work. The grievor told the supervisor he could not work with required the employer to request a health and safety repre-
the supervisor so close and hollering at him because it was sentative once the grievor raised his concerns to the risk, and
making him nervous, that his hands were shaking, and that his by refusing to do so and then punishing the grievor, the em-
job involved dealing with very sharp metal that could cut off ployer violated the Occupational Health and Safety Act. Second,
his fingers if he was not careful. He requested a health and the employee’s refusal to work fit within the health and safety
safety representative to assess the situation. The supervisor exception to the “work now, grieve later” rule. The grievor
refused that request because he did not perceive any unusual honestly believed he was in danger, he communicated this
danger. When the grievor refused to start working, the super- concern to the employer, and the concern of being cut or hav-
visor suspended the grievor without pay for two days for in- ing a finger cut off was reasonable under the circumstances
subordination. The union filed a grievance asserting a lack of and sufficiently serious to justify the refusal. Therefore, the
just cause as well as a violation of the Occupational Health and arbitrator rescinded the suspension because the employer did
Safety Act for penalizing the grievor for exercising the right to not have just cause.
refuse unsafe work under the legislation.

4. Harassment, Violence, and Other Misconduct in the Workplace

Arbitrators treat harassment, violence, and threats of violence70 in the workplace as serious
infractions, for obvious reasons. Employers have a legal obligation to ensure a safe workplace
that is free from harassment and fear of violence, and therefore arbitrators accept that discipline,
up to and including dismissal, may be warranted. However, not every instance of harassment,
violence, or threat of violence warrants discipline or dismissal. By now, you should expect that
arbitrators consider all of the circumstances surrounding the incident(s), including the serious-
ness of the incident and the usual mitigating factors such as length of service and past disciplin-
ary record. They also consider whether the grievor was provoked, whether the incident was a
one-off event that was an uncharacteristic outburst by the grievor, whether the harasser was in
a position of authority over the victim, and whether the grievor apologized and demonstrated
remorse.71 If rough language or sexual banter is common, and the alleged victim has partici-
pated in the past or not previously objected, an arbitrator is more likely to accept an argument
that the grievor was unaware their comments were unwanted and offensive.72 Sexual miscon-
duct at work is also serious discipline-worthy conduct, although as demonstrated in Box 36.12,
a balancing is required.

Is a Brief, Spontaneous Sexual Activity at Work Just Cause for Termination?
Vernon Professional Firefighters’ Association, I.A.F.F. a real concern that someone was improperly accessing the
Local 1517 v. Corporation of the City of Vernon chief’s filing cabinet and looking at or possibly removing docu-
2019 CanLII 28158 (BCLA) ments), and (2) the privacy interest at stake was minimal (it
was a camera in the chief’s office pointing directly at the
Key Facts: A fire captain (Bond) with 20 years’ service and a cabinet).
station dispatcher (M) with 8 years’ service were engaged in a The video showed Bond and M engaging in a brief sexual
secret affair. They were captured by a secret surveillance cam- encounter in the office and then quickly leaving. The activity
era installed to monitor a filing cabinet engaging in what the was consensual and not an abuse of authority by Bond, and
arbitrator called “a brief episode of consensual sexual activity” it was spontaneous, but it was clear that they both knew what
in the fire chief’s office. The employer discovered the video they were doing was wrong. Sexual activity at work is a serious
footage the next day and called the employees in separately workplace offence worthy of serious discipline. However, the
to interviews where the employees initially denied the event. arbitrator ruled that termination was too harsh in the circum-
The employer terminated the employees for the sexual activity stances. He noted: “In the context of an employment relation-
and for dishonesty when they were asked about it. The union ship, employer discipline is not to punish. It is to correct
filed a grievance, alleging the employer did not have just cause unwanted behaviour and misconduct.” Where, as here, long-
for termination. The union also argued that the video footage service employees demonstrate a single brief, spontaneous
should not be admitted as evidence because it amounted to lack of judgment, they are entitled to a warning and a chance
an unwarranted intrusion on the employees’ privacy. to correct their behaviour. Progressive discipline is warranted.
Issue: Did the employer have just cause for termination, and Both employees were reinstated. However, by the time of the
is the video surveillance footage admissible as evidence? arbitration decision, M’s dispatch job had already been con-
tracted out, so she was entitled to receive the termination pay
Decision: The arbitrator decided in a separate ruling that the she would have received. Bond was reinstated with a five-
secret video surveillance evidence was admissible.* The arbi- month suspension without pay and a three-year demotion to
trator considered the British Columbia Freedom of Information a lower rank after which period he will return to the rank of
and Privacy Act (see Chapter 26) and arbitration case law on chief.
employee privacy and ruled that (1) the employer had a legit-
imate pressing business reason to install the camera (there was * Corporation of the City of Vernon, 2018 CanLII 111669 (BCLA).

5. Absenteeism and Lateness

If an absence is without a good reason or the employee failed to advise the employer of the ab-
sence where there was an opportunity to do so, the absence will usually be considered “culpable”
and deserving of some discipline.73 Since arbitrators expect employers to apply progressive
discipline (as discussed above), an employer that fails to provide a tardy employee with a clear
warning and chance to improve their attendance will almost certainly have its decision to dis-
miss the employee overturned. Many employers introduce “attendance management policies”
that set out the progressive discipline that will be applied to employees who are late or absent
for culpable reasons.
For discipline to be justified, it must be “culpable.” That means the employee’s absence must
be blameworthy, and it must have been within the employee’s power to attend work. If the ab-
sence is for reasons beyond the employee’s control, such as illness or is related to disability,
religion, or some other reason related to a prohibited ground of discrimination in human rights
legislation, it is considered to be innocent absenteeism, and the employee cannot be disci-
plined.74 The employer’s legal right to dismiss the employee for absence related to human rights
grounds is now governed by human rights law, including the duty to accommodate (explored in
Chapters 22 and 23). As noted earlier in the chapter, arbitrators are required to apply human
rights statutes when they interpret collective agreements. Therefore, grievances challenging
discipline or termination for non-culpable absenteeism now require arbitrators to apply a
human rights approach.
When deciding whether an employer has just cause to dismiss an employee for “innocent”
or non-culpable absenteeism, arbitrators (and human rights tribunals) consider two questions:
1. Is the employee’s absenteeism excessive relative to an average employee in the work

establishment?
2. If yes, then is there a reasonable prospect of the employee being able to return to work
in the foreseeable future, considering any potential accommodation to the point of
undue hardship if the reason for the absence is related to human rights grounds?75
6. Off-Duty Conduct

At a general level, how employees behave during their non-working time is none of the employ-
er’s business, except when that behaviour interferes with the ability of the employee to perform
their job or could harm the employer’s reputation or other business interests. The leading arbi-
tration decision setting out the test employers must satisfy to justify discipline or dismissal for
off-duty conduct is the 1967 case of Re Millhaven Fibres Ltd. v. Atomic Workers Int’l Union, Local
9-670, in which the arbitrator proclaimed the following test:
if the discharge is to be sustained on the basis of … justifiable reasons arising out of conduct away
from the place of work, there is an onus on the Company to show that:
(1) the conduct of the grievor harms the Company’s reputation or product;
(2) the grievor’s behaviour renders the employee unable to perform his duties satisfactorily;
(3) the grievor’s behaviour leads to refusal, reluctance or inability of the other employees to work
with him (that is based on a legitimate fear of injury or harm, and not just a dislike of the grievor);

(4) The grievor has been guilty of a serious breach of the Criminal Code and thus rendering his
conduct injurious to the general reputation of the Company and its employees; or
(5) Places difficulty in the way of the Company properly carrying out its function of efficiently
managing its works and efficiently directing its working forces.76
The employer need only establish that one of the criteria is met, although as in each just cause
case, all of the circumstances will be considered in assessing whether the employer’s response
was appropriate, including the mitigating factors discussed previously. In particular, arbitrators
balance the harm to the employer against the right of employees to live their private lives with-
out employer supervision.77
In measuring harm to the employer’s reputation, arbitrators apply an “objective test” (see
Chapter 7), asking, “What would a reasonable person of normal intelligence think, if told about
the circumstances?” In this instance, would a reasonable person aware of the employee’s off-duty
conduct believe the conduct would cause real injury to the employer’s reputation?78 Evidence of
actual harm is not necessary. Since there must be a nexus between the employee’s behaviour and
harm, or potential harm, to the employer’s reputation or other business interests, it matters what
the employee’s job entails and the line of business the employer is in. For example, teachers, law
enforcement employees, and other employees in positions of authority and trust may be held to
a higher standard of integrity in their off-duty behaviour than are labourers who do not work
with the public or young people.79
In recent years, the question of whether an employee’s use of social media outside of working
hours can give rise to discipline or dismissal has arisen. The Millhaven test is applied in these
cases, with a focus on the potential harm to the employer’s reputation. Box 36.13 contrasts two
recent arbitration awards involving the dismissal of firefighters for offensive tweets.80 What
explains the different outcomes?

Can Off-Duty Tweeting Amount to Just Cause for Dismissal?
Toronto Professional Fire Fighters’ Association, Local Toronto (City) v. Toronto Professional
3888 v. Grievance of Lawaun Edwards [Edwards Fire Fighters’ Association,
Grievance] Local 3888 [Bowman Grievance]
2014 CanLII 62879 (Arbitrator Misra) 2014 CanLII 76886 (Arbitrator Newman)
Key facts: The grievor, who had 2.5 years of discipline-free The grievor, who had 2.5 years of discipline-free service, was dis-
service, was dismissed for the following Twitter missed for a series of tweets, including the following:
exchange:
Grievor: Reject a woman and she will never let it go. One of the
Other person: Just stood behind a girl who used many defects of their kind. Also weak arms.
the word “like” roughly 300 times to order her
Grievor: I’d never let a woman kick my ass. If she tried I’d be like
coffee. Stay in skool, kidz
HEY! You get your … ass back in the kitchen and make me some
Grievor: Would swat her in the back of the head pie.
be considered abuse or a way to reset the brain?
Grievor: If you were deaf I would rape you and then break your
Other person: Maybe foreplay? fingers so you can’t tell anyone …
Grievor: Unlikely, intelligence and a vocabulary The grievor claimed he thought his tweets were private and read-
is sexy. Saying “like” that amount of times means able only by his “followers.” The grievor wrote a lengthy apology to
you have none the employer, acknowledging that his tweets were inappropriate.

Toronto Professional Fire Fighters’ Association, Local Toronto (City) v. Toronto Professional
3888 v. Grievance of Lawaun Edwards [Edwards Fire Fighters’ Association,
Grievance] Local 3888 [Bowman Grievance]
2014 CanLII 62879 (Arbitrator Misra) 2014 CanLII 76886 (Arbitrator Newman)
Decision: The Twitter exchange was inappropriate and The employer had just cause for termination.
deserving of some discipline because it was
The arbitrator referred to the Millhaven test criteria and concluded
disrespectful to women.
that criterion four should be updated to recognize serious
The grievor’s twitter account identified him as a breaches of human rights legislation that harm the employer’s
firefighter, and the National Post story had reputation. The question an arbitrator should ask when consider-
harmed the employer’s reputation. However, ing potential harm to an employer’s reputation is this: Would a
dismissal was too harsh a consequence. The reasonable and fair-minded member of the public, if apprised of all
tweet was directed at an anonymous person, no the facts, consider that the grievor’s continued employment would
one at work had complained, and the grievor so damage the reputation of the employer as to render that
had a clean disciplinary record. The employer employment untenable?
had a social media policy, but it had not done a
good job of disseminating it. Here, the grievor made comments on Twitter that were highly
offensive. In fact, he made many offensive comments over a two-
year period. The comments were sometimes violent and certainly
sexist. The tweets caused reputational harm to the employer after
they were widely reported in the media. Although the grievor
apologized, the arbitrator doubted his apology was sincere and
that he fully grasped how offensive his comments were.
The arbitrator did not accept the grievor’s argument that he

thought tweets were private. She wrote: “When engaging in social
media use … the user must accept responsibility when the content
is disseminated in exactly the manner promoted by the social
media provider.”
Outcome: The grievor was reinstated with a three-day The dismissal of the grievor was upheld. The grievance was
suspension. dismissed.
7. Intoxication at Work

Drinking or taking mind-altering drugs at work, particularly when a job is safety sensitive, is
considered a serious disciplinary offence.81 Reporting to work intoxicated is also a serious
offence, although the employer must establish that the employee is impaired; for example, an
employee who had a beer or consumed marijuana at some point before their shift began may
not be impaired.82 Different considerations apply if the employee has a drug or alcohol addic-
tion, which are considered disabilities in human rights statutes. An employer who disciplines an
alcoholic or drug-addicted employee for reporting to work intoxicated may be required to
demonstrate that it had accommodated that employee’s disability by, for instance, allowing the
employee to take a leave of absence to attend an addiction program.83
VIII. Chapter Summary

This chapter provided a high-level overview of the grievance and labour arbitration process in
the collective bargaining regime. Grievance arbitration was intended to provide an expedient,
inexpensive, and informal alternative to litigation in the common law courts. This ideal model
has been under strain for some time, as arbitration has grown more legalistic and the jurisdic-
tion of arbitrators has expanded exponentially over the years with the encouragement of legis-
lators and the Supreme Court of Canada. We examined the extensive arbitration case law
applying “just cause” for discipline and dismissal provisions in collective agreements. The

requirement for unionized employers to demonstrate that they have “just cause” to discipline or
dismiss an employee is among the most significant differences between the common law regime
and the collective bargaining regime. Through “just cause” provisions, unionized employees
acquire a more substantial right to a job than exists in the common law regime for non-union
workers.
APPLYING THE LAW: LABOUR ARBITRATION SIMULATION

Note to Instructors: Role-playing exercises and instructions resentative for more information or visit this book’s website at
for a mock labour arbitration case are available as part of the <https://www.emond.ca/LW2>
supplements package made available to instructors who have
adopted this text for classroom use. Contact your Emond rep-

1. Describe four types of grievances.
2. Describe three ways in which labour arbitration differs from courtroom litigation.
3. Summarize Ontario Chief Justice Warren Winkler’s argument in Box 36.6 in a mini-essay
of 500 words or less.
4. Explain the William Scott test applied by arbitrators in “just cause” grievance
arbitrations.
5. If an arbitrator rules that an employer did not have just cause to dismiss an employee, what
remedies can that arbitrator order?
6. What is the “work now, grieve later” rule? Describe five exceptions to that rule.
APPLYING THE LAW

1. Joe works at a large unionized hotel as a restaurant and the wine is too good to waste.” The investigator re-
server. He’s been employed there for three years and ports the incident to the employer, including the video,
has no record of prior discipline. He is 40 years old and and the employer terminates Joe. The union files a
the sole income earner for his wife and two children. grievance alleging the employer had no just cause for
The employer was experiencing problems of pilferage, termination. At the arbitration hearing, Joe is apologet-
including theft of alcohol, food, and toiletries. There- ic and admits what he did was wrong and stupid.
fore, it hired a private investigator to pose as a custo- a. If you represented Joe and the union in this griev-
dian. The “custodian” roamed around looking for ance, what argument(s) would you make?
employee misconduct, occasionally filming suspicious b. What would the employer argue?
activity on his phone. One night, Joe returned to the c. If you were the arbitrator, would you reinstate Joe?
kitchen with a half-drunk expensive bottle of wine that If so, would you substitute a lesser penalty? What
a customer had left. Joe knows that he is supposed to would that penalty be? Would it make a difference
pour the wine down a drain and send the bottle to re- to you if Joe had ten years’ discipline-free service
cycling. However, Joe instead offers to give the bottle rather than just three years? The facts in this scen-
of wine to the “custodian” and tells him he can have it ario are based on the decision Unite Here Local 75 v
but he should pretend to be taking it out to trash in Fairmont Royal York Hotel, 2012 CanLII 3871 (Ont.
case he is seen. The custodian thanks him and secretly LA). Read the decision to see how the arbitrator
records the next exchange in which Joe says, “I decided.
shouldn’t be doing this, but you seem like a nice guy


1. Wartime Labour Relations Order (PC 1003). 9. See, for example, Isabelle v. Ontario Public Service Employ-
2. Parry Sound (District) Social Services Administration Board ees Union, [1981] 1 SCR 449 at para 14.
v. O.P.S.E.U., Local 324, 2003 SCC 42 at para 30. 10. K. Swinton, “Book Review: Canadian Labour Arbitration,
3. See New Brunswick v. O’Leary, [1995] 2 SCR 967; and Shell by D. J. M. Brown and D. M. Beatty; Collective Agreement
Canada Ltd. v. United Oil Workers of Canada, [1980] 2 Arbitration in Canada, by E. E. Palmer” (1978) 16 Osgoode
SCR 181. Hall LJ 795 at 795.
4. Cummins Western Canada, 2010 CanLII 77035 (BCLA); 11. D. Brown & D. Beatty, Canadian Labour Arbitration, 4th
Cameo Inc., 2000 CanLII 29485 (Ont. LA); Slater Steels ed (Aurora, ON: Canada Law Book, 2006).
Hamilton Specialty Bar Division, 2003 CanLII 18277 (Ont. 12. Ibid. See also Snyder, supra note 8; M. Mitchnick & B.
Sup Ct J); Pepsico Beverages Canada (London), 2012 Etherington, Labour Arbitration in Canada, 2nd ed
CanLII 35574 (Ont. LA) (Snow); Lilydale Inc., 2015 CanLII (Toronto, ON: Lancaster House, 2013).
57060 (Sask. LA); and Toronto Transit, 2012 CanLII 40324 13. BC Labour Relations Code, supra note 6, s. 99. British Col-
(Ont. LA). Interesting issues can arise when the last chance umbia is unusual in assigning the labour relations board to
agreement (LCA) permits the employer to terminate an hear “appeals” of arbitration decisions.
employee for misconduct related to a prohibited ground,
14. See, for example, Wilson v. Atomic Energy of Canada Ltd.,
such as a disability, and prevents the employee from griev-
2016 SCC 29; Ontario Public Service Employees Union v.
ing. In some cases, those LCAs have been struck down as
Seneca College of Applied Arts & Technology, 2006 CanLII
being contrary to the human rights obligation to accom-
14236 (Ont. CA); Dunsmuir v. New Brunswick, 2008 SCC 9;
modate the employee’s disability to the point of undue
and Parry Sound (District) Social Services Administration
hardship: See, for example, Ontario (Human Rights
Board v. O.P.S.E.U., Local 324, supra note 2. For a nice
Comm.) v. Gaines Pet Foods Corp., 1993 CanLII 5605 (Ont.
summary of the law of judicial review of arbitrator’s deci-
Gen Div); Milazzo v. Autocar and Connaisseur Inc., [2005]
sions, see Snyder, supra note 8 at chapter 7.
CHRD No. 3; Re: Fantom Technologies (1998), 70 LAC
(4th) 241 (Beck); and Seaspan ULC, 2014 CanLII 83893 15. The standard of review of arbitrators’ application of the
(BCLA) (Lanyon). Charter and human rights legislation is “correctness.” See
Cuddy Chicks Ltd. v. Ontario (Labour Relations Board),
5. There are exceptions. For example, in Ontario, grievances
[1991] 2 SCR 5. There remains some uncertainty about
involving construction employers must be referred to the
whether the standard of review for arbitration decisions
Ontario Labour Relations Board, which decides the case as
applying human rights legislation is “reasonableness” (see
if it were an arbitrator.
Ontario Nurses’ Association v. Cambridge Memorial Hospi-
6. See, for example, Ontario Labour Relations Act, 1995, SO tal, 2019 ONSC 3951), or “correctness” (Telecommunica-
1995, c. 1, Sched. A, s. 49; and BC Labour Relations Code, tions Workers Union v. Telus Communications Inc., 2014
RSBC 1996, c. 244, s. 104. See the discussion in G. Adams, ABCA 154).
Canadian Labour Law, 2nd ed (Aurora, ON: Canada Law
16. See Alberta Union of Provincial Employees v. Lethbridge
Book, 1993) at chapter 12(3)(iii), “Access to Statutory
Community College, 2004 SCC 28 at para 41.
Expedited Arbitration.”
17. See, for example, Ontario Labour Relations Act, supra note
7. See, for example, Canada Labour Code, RSC 1985, c. L-2,
6, s. 48.
ss. 60(1), 16(c); Ontario Labour Relations Act, supra
note 6, s. 48(12)(f); Alberta Labour Relations Code, RSA 18. Heustis v. N.B. Elect. Power Commiss., [1979] 2 SCR 768.
2000, c. L-1, s. 143 (2); and BC Labour Relations Code, 19. For a full discussion of arbitrators’ remedial authority, see
supra note 6, s. 92(1)(b). See the judicial discussion of evi- Brown & Beatty, supra note 11 at 2:1, 500, “Remedial Au-
dentiary rules in arbitration in Re City of Toronto, 1982 thority of the Arbitrator.”
CanLII 2229 (Ont. CA). 20. See, for example, Re Oil, Chemical and Atomic Workers
8. See Re Girvin et al. and Consumers’ Gas Co., 1973 CanLII and Polymer Corp. Ltd. (1959), 10 LAC 51 (Laskin),
706 (Ont. H Ct J); R. Snyder, Collective Agreement Arbi aff ’d Imbleau et al. v. Laskin et al., [1962] SCR 338; and
tration in Canada, 5th ed (Markham, ON: LexisNexis, Beckett Elevator Company Limited, 1983 CanLII 960
2013) at 256-63. The courts have also expressed concern (Ont. LRB).
over arbitrators’ willingness to permit evidence that a 21. Kaiser Aluminum & Chemical of Canada Ltd., 2005 CanLII
court would not have accepted: Cie minière Québec Cartier 67217 (Ont. LA) (Surdykowski); Greater Toronto Airports
v. Quebec (Grievances arbitrator), [1995] 2 SCR 1095 (the Authority v. Public Service Alliance Canada Local 004, 2011
arbitrator erred in relying on evidence of the employee’s ONSC 487; and Petrow v. Limo Jet Gold Express Ltd., 2009
post-discharge treatment to overturn the employer’s deci- CanLII 4193 (BCLRB).
sion to terminate the employee’s employment contract).

22. Health Employers’ Association of British Columbia (2008), Limited v. United Steelworkers of America, Local 7884, 1999
180 LAC (4th) 266 (Taylor). BCCA 38 (a defamation lawsuit against a union official for
23. Prestressed Systems Incorporated, 2005 CanLII 63785 (Ont. writing that the employer compromised safety in the
LA). However, apologies are rarely ordered: Thames Emer- workplace).
gency Medical Services Inc., 2006 CanLII 12300 (Ont. LA). 30. In McLeod v. Egan, [1975] 1 SCR 517, the Supreme Court
24. Weber v. Ontario Hydro, [1995] 2 SCR 929. See Brown & ruled that arbitrators cannot ignore employment standards
Beatty, supra note 11 at 2:205, “The Charter of Rights and legislation when they interpret collective agreements.
Freedoms.” On administrative tribunals (including arbitra- Parry Sound (District) Social Services Administration Board
tors) lacking authority to make general declarations of v. O.P.S.E.U., Local 324, supra note 2, went further and
legislation invalidity, see Alberta (AG) v. UFCW, Local 401 ruled that employment-related statutes are incorporated
(2010), 200 LAC (4th) 1 (Alta. QB); and Cuddy Chicks Ltd. into collective agreements.
v. Ontario (Labour Relations Board), supra note 15. 31. See also Brown v. University of Windsor, 2016 ONCA 431
25. See P. Weiler, “The Role of the Labour Arbitrator: Alterna- (the allegation that the employer violated the Employment
tive Versions” (1969) 19:1 UTLJ 16; and D. Beatty, “The Insurance Act falls within the jurisdiction of the arbi-
Role of the Arbitrator: A Liberal Version” (1984) 34 trator); and British Columbia Teachers’ Federation v. British
UTLJ 136. Columbia Public School Employers’ Association, 2005
BCCA 92 (the arbitrator has jurisdiction to hear a griev-
26. P. Weiler, Reconcilable Differences: New Directions in Can-
ance alleging the employer violated the statute relating to
adian Labour Law (Toronto, ON: Carswell, 1980) at
class size). An exception to this general rule is that
109-10; and K.W. Thornicroft, “Do Lawyers Affect Griev-
employment standards rules that are intended to apply
ance Arbitration Outcomes? The Newfoundland Experi-
only to non-union employees, and therefore are “in-
ence” (Spring 1994) 49:2 Indus Rel 356.
compatible” with the collective bargaining regime, are not
27. Weber v. Ontario Hydro, supra note 24. See also St. Anne to be incorporated into a collective agreement (such as the
Nackawic Pulp & Paper v. Canadian Paper Workers Union, right in employment standards legislation permitting ter-
Local 219, [1986] 1 SCR 704; and Bisaillon v. Concordia mination with notice alone). See Isidore Garon ltée v.
University, 2006 SCC 19. Tremblay; Fillion et Frères (1976) inc. v. Syndicat national
28. A substantial body of literature explores the scope of des employés de garage du Québec inc., 2006 SCC 2. See
Weber v. Ontario Hydro, supra note 24. See, for example, R. also the discussion in A. Lokan & M. Yachnin, “From
MacDowell, “Labour Arbitration: The New Labour Weber to Parry Sound: The Expanded Scope of Arbitra-
Court?” (2008) 8 CLELJ 121; B. Adell, “Jurisdictional tion” (2004) 11 CLELJ 1; and S. Luciw, “Parry Sound and
Overlap Between Arbitration and Other Forums: An Its Successors in the Supreme Court of Canada: Implica-
Update” (2000) 8 CLELJ 179; D. Carter, “Looking at Weber tions for the Scope of Arbitral Authority” (2004) 11
Five Years Later: Is It Time for a New Approach?” (2000) 8 CLELJ 365.
CLELJ 231; and M. Picher, “Defining the Scope of Arbitra- 32. See, for example, Ontario Employment Standards Act,
tion: The Impact of Weber—An Arbitrator’s Perspective” 2000, SO 2000, c. 41, s. 99; BC Employment Standards Act,
(1999 – 2000) 1 Lab Arb YB 99. RSBC 1996, c. 113, s. 3(7).
29. Cases finding that arbitration is the exclusive forum include 33. See, for example, Ontario (Human Rights Commission) v.
New Brunswick v. O’Leary, supra note 3 (the employer Naraine, 2001 CanLII 21234 (Ont. CA); Quebec (Commis-
claimed that the employee was negligent in use of a leased sion des droits de la personne et des droits de la jeunesse) v.
vehicle); Cherubini Metal Works Ltd. v. Nova Scotia (Attor- Quebec (Attorney General), 2004 SCC 39; Northern
ney General), 2007 NSCA 38 (an employer’s lawsuit against Regional Health Authority v. Manitoba Human Rights Com-
a union alleging torts related to the union’s filing of many mission et al., 2016 MBQB 89; Meade v. National Steel Car
grievances); Moznick v. Richmond (2006), 158 LAC (4th) 1 Limited, 2016 HRTO 1383; Canada (House of Commons) v.
(Joyce) (negligence action for harassment at work); Giorno Vaid, 2005 SCC 30; and Brown & Beatty, supra note 11, at
v. Pappas, 1999 CanLII 1161 (Ont. CA) (employee’s defa- 1:4, 200.
mation lawsuit against a co-worker for an insulting letter
34. The authority to dismiss a human rights complaint already
sent around the workplace); and Ferreira v. Richmond
considered and decided by an arbitrator is either statutory
(City), 2007 BCCA 131 (tort lawsuit for intentional inflic-
(Ontario Human Rights Code, RSO 1990, c. H.19, s. 45.1;
tion of mental suffering relating to verbal harassment by
BC Human Rights Code, RSBC 1996, c. 210, s. 25; and
co-workers). Cases finding that arbitration is not the exclu-
British Columbia (Workers’ Compensation Board) v. Figli-
sive forum and that the lawsuit can continue include Piko
ola, 2011 SCC 52) or derived from the common law doc-
v. Hudson’s Bay Co., 1998 CanLII 6874 (Ont. CA) (a tort
trine of issue estoppel or abuse of process (Dick v. The
lawsuit relating to an employer’s instigation of criminal
Pepsi Bottling Group (Canada) Co., 2014 CanLII 16055
proceedings against an employee); and Fording Coal
(Man. HRC)).

35. See, for example, Manitoba Labour Relations Act, CCSM 48. Canada Safeway (2002), 108 LAC (4th) 161 (Chertkow);
c. L10, s. 79, which requires that every collective agree- Lethbridge Community College, supra note 16.
ment “contain a provision requiring that the employer 49. See Fairmont Royal York Hotel, 2012 CanLII 3872 (Ont.
have just cause for disciplining or dismissing any em- LA) (Trachuk) (an employee was reinstated with suspen-
ployee” in the bargaining unit. See also BC Labour Rela- sion for surfing the web for personal use at work).
tions Code, supra note 6, s. 84.
50. Re Gould Manufacturing of Canada Ltd. and United Steel-
36. Sometimes the collective agreement does not include a just workers of America, 1973 CanLII 805 (Ont. H Ct J). The
cause provision or excludes the term’s application to some test for assessing discipline for mistruths on application
employees, such as probationary employees. For a discus- forms is similar to that in the non-union setting, which
sion of how arbitrators have dealt with the absence of just was discussed in Chapter 6. The employer must demon-
cause provisions, see the discussion in Brown & Beatty, strate the dishonesty, that it affected the employer’s hiring
supra note 11 at 7:1, 200. decision, and that it suffered some prejudice. See the dis-
37. McKinley v. BC Tel, 2001 SCC 38. See also Metal Koting cussion in Brown & Beatty, supra note 11 at 7:3, 324.
(Continuous Colour Coat Limited), 2012 CanLII 63726 51. See Re Phillips Cable Ltd. (1974), 6 LAC (2d) 35 (Adams):
(Ont. LA) (Hayes); Hamilton Health Sciences, 2006 CanLII “Honesty is a touchstone to viable employer-employee
50484 (Ont. LA) (Surdykowski); and Sysco Food Services of relationships.”
Ontario, 2004 CanLII 54978 (Ont. LA) (Gray).
52. McKinley v. BC Tel, supra note 37.
38. Port Arthur Shipbuilding Co. (1967), 17 LAC 109 (Arthurs).
53. See the discussion of the importance of accepting respon-
39. See F.H. v. McDougall, 2008 SCC 53 for a discussion of the sibility for misconduct in British Columbia Hydro (2001),
“balance of probabilities” standard in civil cases, especially 94 LAC (4th) 305 (Kinzie).
paras 45-46; and Edmonton (City) (2013), 232 LAC (4th)
54. See Brown & Beatty, supra note 11 at 7:3, 300. Cases where
376 (Jolliffe).
a dishonest employee was reinstated include the following:
40. Many cases discuss these mitigating factors. Some often- Sobeys West Inc. (Safeway), 2015 CanLII 68542 (BCLA)
cited authorities include Steel Equipment Co. Ltd. (1964), (Kondopulos); Women’s College Hospital, 2011 CanLII
14 LAC 356 (Reville); Wm. Scott & Company Ltd. (1977), 26325 (Ont. LA) (Stout); and Overwaitea Food Group, 2014
1 CLRBR 1 (BCLRB); and Galco Food Products (1974), 7 CanLII 11427 (BCLA) (Doyle). Cases where dismissal of a
LAC (2d) 350 (Beatty). dishonest employee is upheld by the arbitrator include the
41. See discussion in Snyder, supra note 8 at 532-36; and following: Sysco Food Services of Ontario, supra note 37;
Mitchnick & Etherington, supra note 12 at 182-83. Hamilton Health Sciences, supra note 37; Toronto (City),
42. See, for example, O.I. Canada Corp., 2009 CanLII 27269 2014 CanLII 87075 (Ont. LA) (Sheehan); Surrey (City),
(Ont. LA) (Chauvin). 2012 CanLII 66328 (BCLA) (Brown); Protrans BC Oper-
ations Ltd, 2012 CanLII 97717 (BCLA) (Jackson); Capitol
43. Ontario Labour Relations Act, supra note 6, s. 48(17). The
Regional District, 2013 CanLII 54957 (BCLA) (Nichols);
Supreme Court of Canada ruled in Port Arthur Shipbuild-
Shaw Cablesystems G.P. (North Shore), 2010 CanLII 37096
ing Co. v. Arthurs et al., [1969] SCR 85 that arbitrators had
(BCLA) (Kinzie); and Government of the Province of
no inherent right to substitute a lesser penalty. As a result,
British, 2000 CanLII 29378 (BCLA) (Lanyon) (the termin-
governments across Canada legislated that power in the
ation of an alcoholic for stealing alcohol was upheld).
form of sections like s. 48(17).
55. See also Labatt Brewing, 2001 CanLII 25965 (Ont. LA)
44. Region of Peel, 2011 CanLII 7758 (Ont. LA) (Brownlee);
(Surdykowski) (upholding dismissal of an employee who
Aviscar Inc., 2015 CanLII 20440 (Alta. GAA) (Wallace);
stole a $10 promotional baseball cap). But see Maple Leaf
and T.T.C. (2010), 193 LAC (4th) 273 (Harris). The lan-
Sports and Entertainment, 2016 CanLII 70978 (Ont. LA)
guage must be specific and clear. See the discussion in
(Jesin) (reinstatement with suspension of employee who
Warehousemen and Helpers Union, Local 979 v. Brink’s
helped himself to pop from the soda fountain machine).
Canada, [1983] 1 SCR 382.
56. Canada Safeway Ltd. (2011), 210 LAC (4th) 173 (Glass).
45. The authority of arbitrators to award damages for breach
of a collective agreement was affirmed in Imbleau et al. v. 57. See, for example, Toronto (City), 2013 CanLII 72336 (Ont.
Laskin et al., supra note 20. LA) (Randall) (poor performance due to laziness resulted
in reinstatement with one-month suspension); and Mada-
46. A. Ponak, “Discharge Arbitration and Reinstatement: An
waska Doors (2004), 127 LAC (4th) 378 (Dumoulin).
Industrial Relations Perspective” (1992) 2 Lab Arb YB 31.
58. Toronto Transit Commission, 2011 CanLII 52245 (Ont. LA)
47. United Steelworkers of America, Local 12998 v. Liquid Car-
(Slotnick); Invista (Canada) Company, 2014 CanLII 27444
bonic Inc. 1996 CanLII 11787 (Ont. Gen Div); and Alberta
(Ont. LA) (Steinberg); Re London (City), [2009] OLAA No.
Union of Provincial Employees v. Lethbridge Community
317 (Williamson); and Re Steel Co. of Canada Ltd. (1976),
College, supra note 16.
7 LAC (2d) 132 (Beatty).

59. Re Edith Cavell Private Hospital (1982), 6 LAC (3d) 229 and Safety Act imposition of a legal duty on employers to
(Hope); Ontario Power Generation Inc., 2019 CanLII 41259 maintain workplaces free from threats increases the seri-
(Ont. LA); Alberta Union of Provincial Employees v. Leth- ousness of workplace threats.
bridge Community College, supra note 16; Telus Communi- 71. Re Natrel Inc. (2005), 143 LAC (4th) 233 (Knopf); Re Ajax-
cations Company, 2016 CanLII 61445 (Ont. LA) Pickering Transit Authority (2003), 123 LAC (4th) 51
(Hornung); George Brown College of Applied Arts and (Craven); Re Dominion Glass Co. (1975), 11 LAC (2d) 84
Technology, 2010 CanLII 65077 (Ont. LA) (Bendel); Win- (Linden); Toronto Transit Commission, 2013 CanLII 90055
nipeg Regional Health Authority—Midwives, 2014 CanLII (Ont. LA) (Shime); Black & McDonald Ltd., 2016 CanLII
22979 (Man. LA) (Gibson); Calgary Board of Education, 4952 (Ont. LA) (Slotnick); Coca-Cola Bottling Company,
2008 CanLII 88120 (Alta. GAA) (Sims); and Dr. John Gillis 2009 CanLII 70988 (Ont. LA) (Chauvin); and Re McMas-
Memorial Lodge, 2013 CanLII 101338 (NSLA) (Slone). See ter University (1993), 33 LAC (4th) 33 (Brunner).
also the discussion in Snyder, supra note 8 at 676-80.
72. Regional Municipality of Niagara Police Services Board,
60. There are hundreds of arbitration decisions involving 2009 CanLII 16288 (Ont. LA) (Snow); and Vale Canada
insubordination. Those available on CanLII include the Ltd., 2012 CanLII 81310 (Ont. LA) (Johnson).
following: Senior Flexonics (Canada) Limited, 2010 CanLII
73. Goodyear Canada Inc., 2004 CanLII 54975 (Ont. LA)
13639 (Ont. LA) (Gray); Waterloo Region District School
(Gray); Sysco Central Ontario, Inc., 2013 CanLII 76889
Board, 2012 CanLII 42060 (Ont. LA) (Stout); British Col-
(Ont. LA) (McNamee); and Stelco (1987), 28 LAC (3d) 90
umbia Maritime Employers Association, 2011 CanLII 85130
(Lucas).
(BCLA) (McPhillips); British Columbia (Children & Family
Development), 2009 CanLII 88302 (BCLA) (Korbin); Teck 74. Pharma Plus Drugmarts Ltd., 2013 CanLII 34835 (Ont. LA)
Coal Limited, 2014 CanLII 37907 (BCLA) (Kinzie); and (Marcotte); and and Massey-Ferguson Ltd. (1969), 20 LAC
Canada Post Corporation, 2010 CanLII 86367 (BCLA) 370 (Weiler).
(Gordon). 75. Hydro-Québec v. Syndicat des employé-e-s de techniques
61. See Brown & Beatty, supra note 11 at 7:3, 612. professionnelles et de bureau d’Hydro-Québec, section locale
2000 (SCFP-FTQ), 2008 SCC 43; St. Joseph’s General Hospi-
62. See, for example, Tenneco Canada Inc., 2014 CanLII 46059
tal, Elliot Lake, 2006 CanLII 7155 (Ont. LA) (Luborsky);
(Ont. LA) (Wilson).
Re Maple Leaf Meats (2001), 98 LAC (4th) 40 (Whitaker);
63. Matter of Ford Motor Co., 3 LA 779 (1944) (Shulman). See AirBC Ltd. (1995), 50 LAC (4th) 93 (McPhillips); and
also Re Lake Ontario Steel Company Ltd. (1968), 19 LAC Loblaws Companies Limited, 2014 CanLII 9496 (BCLA)
103 (Weiler). (Brown).
64. See the discussion in York Farms Ltd. (1981), 2 LAC (3d) 76. Re Millhaven Fibres Ltd., [1967] OLAA No. 4, 18 LAC 324
112 (Chapman). (Anderson). The employer must demonstrate that at least
65. See, for example, Toronto East General Hospital (2004), 131 one of the criteria is satisfied: Re Air Canada (1973), 5
LAC (4th) 220 (Reilly) (refusal not based on a reasonable LAC (2d) 7 (Andrews). There are hundreds of cases apply-
risk concern); and Lennox Industries (Canada) Limited, ing Millhaven Fibres in off-duty conduct discipline
1999 CanLII 20394 (Ont. LA) (Knopf). scenarios.
66. Re National Starch & Chemical Co. (Canada) Ltd. (1976), 77. Cape Breton-Victoria Regional School Board, 2011 NSCA 9.
11 LAC (2d) 288 (Rayner). For example, an employee 78. See, for example, Ottawa-Carlton District School Board
could refuse to comply with an order to drive a vehicle or (2006), 154 LAC (4th) 387 (Goodfellow); Re British Col-
transport dangerous goods without the proper licence. See umbia (Workers’ Compensation Board) and E.C.E.U.
Re Thibodeau-Finch Express Inc. (1987), 30 LAC (3d) 58 (Campbell) (1997), 64 LAC (4th) 401 (Glass); Sun Country
(Frumkin). Regional Health Authority, 2013 CanLII 94436 (Sask. LA)
67. Robertshaw Controls Canada Inc. (1982), 5 LAC (3d) 142 (Ish); Canada (Attorney General) v. F.J.T., 2008 FC 740;
(Egan); Re Firestone Steel Products of Canada (1975), 8 First Student Canada (Cardinal Coach Lines Ltd), 2012
LAC (2d) 164 (Brandt); Burns Meats Ltd. (1980), 26 LAC CanLII 70257 (Alta. GAA) (Wallace); and Ontario
(2d) 379 (Picher); Natrel Inc., 2005 CanLII 67419 (Ont. (Natural Resources), 2008 CanLII 32797 (Ont. GSB)
LA) (Surdykowski); and Re National Steel Car Ltd. (2001), (Jackson). See also Emergency Health Services Commission
101 LAC (4th) 316 (Shime). and Ambulance Paramedics of British Columbia, C.U.P.E.,
68. Dominion Stores (1972), 31 LAC (3d) 257 (Brandt). Local 873 (1987), 28 LAC (3d) 77 (McColl), warning that
arbitrators should be careful not to accept employer con-
69. Monarch Fine Foods Co. Ltd. (1978), 20 LAC (2d) 419
cerns about potential harm too lightly and should require
(Picher).
the harm to be of a serious nature.
70. See Hood Packaging Corp., 2013 CanLII 35534 (Ont. LA)
79. Grand Erie District School, 2016 CanLII 72391 (Ont. LA)
(Trachuk), observing that Ontario’s Occupational Health
(White) (teachers are held to a high standard of integrity);

Ottawa-Carleton District School, 2006 CanLII 60956 (Ont. Transportation, 2002 CanLII 61259 (Ont. LA) (Harris);
LA) (Goodfellow); Ontario (Transportation), 2013 ONSC and Labatt Alberta Brewery, 2015 CanLII 98936 (Alta.
7227 (the dismissal of a transportation officer for an inde- GAA) (Seveny).
cent act was upheld); and Maritime Employers’ Association, 82. Toronto Transit Commission, 2012 CanLII 453 (Ont. LA)
2013 CanLII 65439 (Ont. LA) (Hayes) (a fight between (Slotnick).
two longshoremen at a union hall was not grounds for
83. Domtar Inc., 2011 CanLII 52247 (Ont. LA) (Albertyn);
termination).
Calgary (City), 2015 CanLII 61756 (Alta. GAA) (Hodges);
80. See P. Kuitenbrouwer, “Two Toronto Firefighters Termin- Goldcorp Canada Ltd., 2013 CanLII 89968 (Ont. LA)
ated over ‘Unacceptable’ Sexist Tweets, Third Reportedly (Kennedy); British Columbia, 2012 CanLII 51827 (BCLA)
Fired over Facebook Post” (September 2013), National (Germaine); and Shaw Cablesystems, 2014 CanLII 16663
Post, online: <http://news.nationalpost.com/toronto/two (BCLA) (Fleming). See also Lakeport Brewing LLP, 2006
-toronto-firefighters-terminated-over-unacceptable CanLII 71519 (Ont. LA) (Surdykowski) (alcoholism was
-sexist-tweets-third-reportedly-fired-over-facebook-post>. not accepted as an excuse for alcohol theft by an em-
81. See, for example, Bullmoose Operating, 1999 CanLII 20292 ployee); and British Columbia (Public Service Agency)
(BCLA) (Greyall); Horizon Plastics Company Limited, 2010 v. British Columbia Government and Service Employees
CanLII 29972 (Ont. LA) (Stout); Bombardier Union, 2008 BCCA 357.


C H A P T E R 37
The Regulation of Unions:

Legal Status, the Duty of Fair
Representation, and Decertification
II. What Is the Legal Status of a Union to Sue and Be Sued in the
• Discuss the legal status of unions in the common law regime. Common Law Regime? 644
• Explain the scope and substance of both the common law and the III. A Union’s Duty of Fair Representation (DFR) 645
statutory duty of fair representation in Canada. A. The History of the Duty of Fair Representation 646
• Explain how a union can be decertified, losing its legal right to represent B. The Scope of the Duty of Fair Representation 646
employees under collective bargaining legislation. C. The Substance of the Duty of Fair Representation 647
• Explain how an employer’s involvement in employees’ attempts to IV. The Decertification of Unions 651
decertify a union can lead labour relations boards to conclude that the A. Decertification Due to Loss of Majority Employee
decertification attempt is not voluntary. Support 652
B. Other Reasons for Decertification 655
C. The Effects of a Successful Application for
Decertification 655
I. Introduction
This chapter opens with a deceptively complex question: What is a union? Stripped to the basics,
a union is really just a combination of individual workers who have joined together for the pur-
pose of trying to improve working conditions. Does the union itself have a legal existence separate
and apart from those workers in the same way that a corporation is recognized as a “legal person”
separate from its shareholders and management? The issue of a union’s legal status is important
because it determines whether unions can bring lawsuits and be sued as parties in the common
law regime and also what legal rights and responsibilities apply to them in the other two regimes.
Therefore, we will consider whether unions exist, legally speaking, in the Canadian legal model.
As we have seen throughout Part IV, collective bargaining statutes confer legal rights and
responsibilities on unions and so, within the collective bargaining regime, unions do have legal
status; unions can enter into collective agreements, enforce those agreements through arbitra-
tion, and exercise other legal rights granted by collective bargaining legislation. That same legis-
lation also imposes legal obligations on unions. An important example is the duty of fair
representation (DFR) owed by unions to the workers they are legally entitled to represent. The
duty of fair representation: A legal obligation imposed on unions to represent employees who fall within the scope of their
representation rights in a manner that is not arbitrary, discriminatory, or in bad faith.
643

scope of that duty is explored in this chapter. Finally, just as collective bargaining legislation
closely regulates the process through which workers transition from the common law regime to
the collective bargaining regime (see Chapter 31), it also regulates how workers can remove
their union and return to the common law regime. That process is commonly referred to as
decertification and is explored later in this chapter.
II. What Is the Legal Status of a Union to Sue and Be Sued in the
Common Law Regime?
We learned in Chapter 29 that for many years combinations of workers were considered unlaw-
ful conspiracies, and workers who joined unions could face liability in tort or even criminal law.
In the common law regime, unions were considered unincorporated associations that lacked
legal status, similar to, say, a book club.1 Since they were not “legal persons,” unions could not
enter into enforceable legal contracts, including collective agreements, and they could not sue
others or be sued. Individual union members and union officials could be sued if they personally
committed a legal wrong, but the union itself lacked any legal status within the common
law regime.
In the 1957 case of Orchard v. Tunney, the Supreme Court of Canada ruled that although a
union does not have an independent legal status, each individual union member, upon joining
the union, notionally enters into a contract with each other member, the terms of which are set
out in the union’s constitution. This conception of unions became known as the “web of con-
tracts” theory. If a union member suffered harm due to a breach of the union constitution, that
member could sue union executives involved in the decision and recover damages from the
union’s assets, and each individual union member could sue other union members for breach of
the union constitution that bound them all together in contract law. The web of contracts theory
was based on a legal fiction, since it ignored basic elements of contract law that were considered
back in Chapter 7, including the need for offer, acceptance, and mutual consideration as condi-
tions of a binding contract between two persons. However, more recently, the Supreme Court
abandoned the notion that a web of contracts exists between union members in the case pre-
sented in Box 37.1.

Are Unions Legal Persons?
Berry v. Pulley tailed”), while the Air Ontario pilots argued that the two senior-
2002 SCC 40 ity lists should be merged (“dovetailed”). When the two groups
could not agree, the dispute was referred, as required by the
Key Facts: Pilots working for Air Canada and Air Ontario were CALPA constitution, to binding arbitration. The arbitrator
members of the same union, the Canadian Air Line Pilots As- issued a decision that effectively merged part of the two se-
sociation (CALPA). When the two employers commenced mer- niority lists. The CALPA executive accepted the decision, but
ger discussions, a process in CALPA’s constitution was triggered the Air Canada pilots took exception, voted not to implement
that required the two groups of pilots to negotiate a method the arbitrator’s seniority list, and eventually left the CALPA and
for deciding how seniority would work once the two groups formed their own union (Air Canada Pilots Association), which
of pilots worked for the same employer. The Air Canada pilots was certified as the pilots’ new union. Air Ontario pilots
argued that the Air Ontario pilots’ seniority list should be launched a class action lawsuit in the common law courts
placed at the bottom of the Air Canada seniority list (“end
decertification: The legal process through which unionized workers remove their union as their legal representative and
transition from the collective bargaining regime to the common law regime.

Chapter 37 The Regulation of Unions: Legal Status, the Duty of Fair Representation, and Decertification 645
against individual Air Canada pilots, arguing that when they obligations on unions, it was time to recognize that unions
refused to accept the arbitrator’s award merging part of the have legal status to enter into a contract with their members.
seniority list, they breached the CALPA constitution that Therefore, unless a statute provides that a union cannot be
bound all of the pilots in a contract. sued, when a person becomes a union member, they enter
into a contract with the union, and the union can be sued in
Issue: Could the Air Ontario pilots sue individual Air Canada its own name “at least for the purposes of discharging their
pilots for breaching the CALPA constitution by refusing to function and performing their role in the field of labour rela-
abide by the arbitrator’s decision? tions.” Therefore, in this case, the lawsuit filed against the indi-
vidual Air Canada pilots was dismissed, since there was no
Decision: No. The court ruled that it no longer made sense to contract between the Air Ontario pilots and the Air Canada
pretend that there was a “web of contracts” between each pilots. The union (CALPA) had complied with the constitution
individual union member. Since collective bargaining legisla- by referring the dispute to arbitration and accepting the arbi-
tion grants unions extensive legal rights and imposes legal trator’s ruling.
Berry v. Pulley found that unions have a legal existence separate from their members and the
union officials because modern collective bargaining statutes confer that existence on them by
granting them extensive legal rights and imposing on them legal obligations. Therefore, unions
can now sue and be sued in the common law courts in relation to matters not arising directly
from the collective agreement (resolved by arbitration) or an employment-related statute
(resolved by an administrative tribunal). For example, unions have sued and have been sued by
their members for alleged breaches of the union’s constitution and by their own employees for
breach of their employment contracts as well as for alleged torts committed by union officials.2
Note that an important exception is stated in Berry v. Pulley. The court indicated that a statute
might state that a union cannot sue or be sued in its own name. Such a statute exists in Ontario.
According to the Rights of Labour Act, “a trade union shall not be made a party to any action in
any court unless it may be so made a party irrespective of this Act or of the Labour Relations
Act.”3 That is confusing language, but what it means in practice is that unions that exist solely
because the Ontario Labour Relations Act, 1995 gives them legal powers still cannot be sued in
the common law courts in Ontario. As a result, lawsuits filed in courts against unions certified
under Ontario law are usually dismissed because of the Rights of Labour Act and the lawsuit
must instead be brought against a group of individual union members or executives as repre-
sentatives of the union. For example, when an employer filed a lawsuit to stop picketers from
blocking a roadway at a hockey arena in Ottawa, it named as the defendants “Kay, in his repre-
sentative capacity as Area Representative of Retail, Wholesale/Canada Canadian Service Sector
Division of United Steelworkers of America, Local 440 et al.”4
III. A Union’s Duty of Fair Representation (DFR)

We learned in Chapter 29 that the central principles of union certification under the Wagner
model of collective bargaining are exclusivity and majoritarianism. Based on these principles, if
a union can establish that it has majority employee support in a bargaining unit found to be
appropriate by the labour relations board, then it may be “certified,” which means it is granted a
legal licence to represent all of the employees in the bargaining unit, even those employees who
are not union members and who may not have wanted union representation at all. As a trade-off
for granting the union “exclusive” bargaining rights, a DFR is imposed on unions to ensure they
represent all bargaining unit employees fairly, without arbitrariness, discrimination, or bad
faith. The DFR balances protection of individual employees from injustice and unfair or unpro-
fessional treatment at the hands of the union, while also respecting the right of unions to take
into account the interests and will of the majority in a legal model based on collectivity.5

A. The History of the Duty of Fair Representation

The origins of the DFR date to a 1944 decision of the US Supreme Court, Steele v. Louisville &
Nashville Railroad. A union had denied membership and seniority rights to black workers in the
bargaining unit at a time before human rights laws prohibited such discriminatory actions. The
court ruled that exclusive representation carried with it an obligation on unions to exercise their
authority fairly on behalf of all employees they represent, without discrimination.6 Two decades
later, in 1967, the US Supreme Court defined the substance of the DFR to include avoidance of
behaviour that is “arbitrary, discriminatory, or in bad faith.”7 In 1968 in Canada, the federal
government’s Task Force on Labour Relations (the Woods Report), which included an im-
portant review of Canadian collective bargaining laws, recommended the adoption of the
American DFR in Canadian law.8
Ontario was the first province to take this step in 1971, introducing a statutory DFR, which
now appears as section 74 of the Ontario Labour Relations Act, 1995. That section reads as
follows:
A trade union … so long as it continues to be entitled to represent employees in a bargaining unit,

shall not act in a manner that is arbitrary, discriminatory or in bad faith in the representation of any
of the employees in the unit, whether or not members of the trade union or of any constituent union
of the council of trade unions, as the case may be.9
Other jurisdictions followed thereafter with similar statutory provisions. Today, all but two
Canadian jurisdictions have codified the DFR into their collective bargaining statute. In New
Brunswick and Prince Edward Island, where no statutory DFR exists, the courts have recognized
a parallel common law duty on unions to represent bargaining unit employees fairly, without
arbitrariness, discrimination, or bad faith.10 In these latter jurisdictions, employees with a DFR
complaint rely on this common law duty and may sue their union in court. In jurisdictions with
a statutory DFR, employees must file a DFR complaint with the labour relations board.11
B. The Scope of the Duty of Fair Representation

The union’s DFR applies to all employees in the bargaining unit, not just union members. Bear in
mind that an important difference exists between union members and bargaining unit employ-
ees. A union member has taken a positive step to join the union—for example, by signing a
union membership card—whereas any employee who happens to work in a job that is included
in the bargaining unit description that the union represents is a bargaining unit employee. Unless
the collective agreement includes a mandatory union membership clause, some employees in
a bargaining unit may not be union members. The DFR is intended to ensure that unions do not
give preference to union members over non-union members. Also, the DFR applies to the man-
ner in which unions represent bargaining unit employees in their relationship with their em-
ployer.12 It does not regulate internal union affairs, such as the election of union officials, the
amount or use of union dues, or the discipline of union members by the union. These sorts of
internal union disputes are contract matters governed by the union’s constitution and do not fall
within the scope of the DFR.13
The DFR provisions found in collective bargaining statutes vary in scope, so it is important
to look at the language they use. The provision in the Ontario Labour Relations Act, 1995, cited
above, is an example of a broadly worded DFR obligation that applies generally to “the represen-
tation” of bargaining unit employees. That language applies both to collective agreement admin-
mandatory union membership clause: A clause in a collective agreement that requires that every employee covered by the
collective agreement (every bargaining unit employee) become a member of the union that negotiated the collective agreement.

istration, including the handling of grievances, and to collective bargaining, including the
decisions unions make during the bargaining process about prioritizing bargaining proposals.
British Columbia, Nova Scotia, Saskatchewan,14 and the federal jurisdiction apply a similarly
broad DFR.15 In Alberta, Manitoba, Newfoundland and Labrador, and Nova Scotia, the DFR
applies more narrowly to the handling of grievances and collective agreement administration
issues, and not to the collective bargaining process.16 For example, section 153(1) of the Alberta
Labour Relations Code reads as follows:
No trade union or person acting on behalf of a trade union shall deny an employee or former em-
ployee who is or was in the bargaining unit the right to be fairly represented by the trade union with
respect to the employee’s or former employee’s rights under the collective agreement.17 [Emphasis
added]
In the provinces with a narrower DFR scope, employees cannot challenge decisions unions
make about what terms to include (and not include) in collective agreements.
C. The Substance of the Duty of Fair Representation

Both the statutory and the common law versions of the DFR in Canada require unions to avoid
the following types of behaviour in their treatment of bargaining unit employees:
• Arbitrariness: Unions must turn their attention to the issues involved, investigate them,
and make reasonable decisions based on their investigation. The Supreme Court of
Canada has described this branch of the DFR obligation as follows: “A union cannot act
arbitrarily, disregarding the interests of one of the employees in a perfunctory matter.
Instead, it must take a reasonable view of the problem before it and arrive at a thoughtful
judgment about what to do after considering the various relevant and conflicting con-
siderations.”18 Negligent actions by a union, such as missing a mandatory time limit for
proceeding with a grievance, can also amount to arbitrary conduct.19
• Discrimination: Unions must not violate human rights statutes, such as by discriminating
on the basis of the prohibited grounds found in those statutes, or make decisions based
on personal favouritism or biases.20
• Bad faith: Unions must not make decisions based on personal animosity, revenge, petti-
ness, or dishonesty.
Most DFR complaints relate to the union’s conduct either in collective bargaining or in the
processing of grievances—in particular, decisions by unions to not file a grievance or to settle
or withdraw a grievance against the wishes of the grievor.
1. The Duty of Fair Representation and Decisions on Whether to Proceed to

Arbitration with a Grievance
Most collective agreements permit employees to file grievances if they believe the employer has
violated their collective agreement rights. However, as noted in Chapter 36, the decision
whether to refer grievances to labour arbitration is usually reserved to the union and not the
individual grievor. Therefore, a union may drop a grievance rather than proceed to arbitration,
against the wishes of the grievor. The implications for employees of the union making this deci-
sion can be significant. Consider a typical termination grievance. An employee is dismissed for
alleged theft and files a grievance, denying the theft. The union investigates and concludes that
an arbitrator will uphold the grievance, so it drops the grievance. At that point, the employee
cannot bypass the union’s decision and proceed to arbitration directly, since the collective agree-
ment gives the union the exclusive right to decide which grievances can move forward. Nor can

the employee sue the employer in a court for wrongful dismissal, since, as we have learned,
unionized employees do not have that option. Therefore, the union’s decision to drop the griev-
ance effectively ends the employee’s options for challenging the employer’s decision to dismiss
them.
When a union drops an employee’s grievance, the employee’s only legal recourse is to pursue
a DFR complaint alleging that the union’s decision was arbitrary, discriminatory, or made in bad
faith. Scholars have long debated whether granting unions the unilateral right to drop employee
grievances is a just model. Two alternative models proposed by leading Canadian labour law
scholars are described in Box 37.2.

Should Unions Have the Right to Drop an Employee’s Grievance Contrary to the Wishes of the
Employee?
Collective agreements usually confer the right to decide faith efforts to settle grievances, and the law should encourage
whether a grievance proceeds to arbitration on the union, reasonable settlements.
rather than the individual grievor. As a result, an employee’s Professor Paul Weiler (Harvard University) proposed that
right to challenge an employer’s decision may be subrogated unions be permitted to settle or drop grievances, subject to
to the union’s right to decide which grievances are worthy of the right of employees to challenge the union’s decision as
litigation. Some Canadian legal scholars have questioned being arbitrary, discriminatory, or made in bad faith using DFR
whether this union right is just. law.† However, he believed that an exception should be made
Professor Bernie Adell (Queen’s University) argued that for grievances that challenge dismissals. Weiler argued that
employees should have a legal right to proceed to arbitration employees should have a unilateral right to proceed to arbi-
with any grievance that their union declines to arbitrate. This tration with dismissal grievances, at their own expense, even
position is sometimes called “individual rights theory.” Adell if the union refuses to move forward, due to the critical im-
argued that “whenever the law gives a substantive right to portance of the grievance to the employee and also because
someone, as it does an individual employee to enjoy the fruits termination grievances rarely give rise to fundamental conflicts
of collective bargaining as contained in a collective agreement, of interest among different groups of bargaining unit employ-
it ought (in the absence of compelling reasons to the contrary) ees. In response to the complaint that employers might end
to provide a procedural means of enforcing that substantive up defending frivolous dismissal grievances in expensive arbi-
right.”* tration hearings that a union would otherwise have dropped,
In Canada, individual rights theory in relation to grievances Weiler was unmoved. He wrote, “I just think that there are limits
has not prevailed for a couple of key reasons. First, in industrial to the sacrifice which can be made to individual rights in the
relations, there is value in having unions act as gatekeepers to pursuit of decent collective bargaining relationships, and that
the grievance procedure. Employers expect unions to drop that limit is reached here.”‡
grievances lacking merit so that employers do not incur un-
necessary legal and arbitration costs. If every employee can * B. Adell, “Collective Agreements and Individual Rights: A Note on the
take their grievance to arbitration, even if they have to pay the Duty of Fair Representation” (1985-86) 11 Queen’s LJ 251 at 255.
union’s share of the cost themselves, the employer would still † P. Weiler, Reconcilable Differences: New Directions in Canadian Labour Law
be left paying its share. Second, if the employer is not guaran- (Toronto, ON: Carswell, 1980) at 137-39.
teed that a resolution reached with the union on a grievance ‡ Ibid. at 139.
will be enforced, then it will be less willing to engage in good-
In the 1984 case of Canadian Merchant Service Guild v. Gagnon et al., the Supreme Court
described the principles that must be applied when assessing whether a union’s decision to drop
a grievance violates the DFR:
1. The exclusive power conferred on a union to act as spokesperson for the employees in a bar-
gaining unit entails a corresponding obligation on the union to fairly represent all employees
in the unit.

2. When, as … is generally the case, the right to take a grievance to arbitration is reserved to the
union, the employee does not have an absolute right to arbitration and the union enjoys con-
siderable discretion.
3. This discretion must be exercised in good faith, objectively and honestly, after a thorough study
of the grievance and the case, taking into account the significance of the grievance and of its
consequences for the employee on the one hand and the legitimate interests of the union on
the other.
4. The union’s decision must not be arbitrary, capricious, discriminatory or wrongful.
5. The representation by the union must be fair, genuine and not merely apparent, undertaken
with integrity and competence, without serious or major negligence, and without hostility
towards the employee.21
In applying these principles, labour relations boards and courts grant unions wide discretion
to make what are often difficult decisions. As long as the union turned its mind to the facts and
issues raised by the grievance, did a fair investigation, and came to a rational decision not tainted
by discrimination or bad faith, the DFR complaint will usually be dismissed, even if the judge
or labour relations board might have come to a different decision had it been making decisions
for the union. Given this standard, most DFR complaints challenging a union’s decision to drop
a grievance fail. However, they do not all fail. Consider what the union did wrong in the case
described in Box 37.3.

The Duty of Fair Representation in the Administration of a Collective Agreement
Mwemera v. United Brotherhood of Carpenters and
Decision: Yes. The labour relations board ruled that it should
Joiners of America, Local Union No. 2010
have been obvious to Orrel that Mwemera was seeking the
2016 CanLII 8866 (Alta. LRB)
union’s assistance to challenge the termination through
Key Facts: Approximately one year into his employment, Mwe- the filing of a grievance, even though Mwemera never said
mera was assigned to take a forklift training course. On the the words “file a grievance.” The fact that Mwemera eventually
first day of the course, he twice fell asleep and was awakened became angry with Orrel and was rude did not relieve Orrel
by the instructor. The employer learned of these incidents, of the duty to investigate the circumstances of the termina-
called him to the office, and issued a written warning. Mwe- tion. Labour relations boards will closely scrutinize a union’s
mera returned to the class, but a few minutes later he was told decision not to grieve or proceed with a grievance that re-
to return to the office where he was informed that his employ- lates to termination of employment given the critical import-
ment was terminated. The employer relied on its “Rules of ance of the issue. Here, Orrel did very little to investigate the
Conduct,” which listed “sleeping while on duty” as an offence circumstances of the termination. He did not challenge the
that “may result in immediate dismissal.” Mwemera called the employer on why Mwemera was dismissed and not the other
union representative (Orrel) to seek help. Orrel asked Mwe- employees who had fallen asleep. He did not ask the em-
mera if he had fallen asleep, and Mwemera said yes but that ployer for any documentary evidence. Instead, he had a short
so had others who had not been dismissed. Mwemera told conversation with Mwemera on the phone and quickly con-
Orrel that he believed the supervisor was out to get him. Orrel cluded that, since he had fallen asleep, there was nothing the
told him that “there is not much I can do,” since Mwemera union could do. The DFR requires the union to fully investi-
admitted to falling asleep. Mwemera became angry and ac- gate the circumstances and come to a reasoned conclusion
cused Orrel of not doing his job and taking the side of the on the merits. Here, the union’s cursory investigation fell
employer. No grievance was filed, but Mwemera filed a DFR short of that standard and was therefore “arbitrary.” As a rem-
complaint against the union. edy, the labour relations board ordered that a grievance be
filed and be referred directly to arbitration. Further, Mwemera
Issue: Did the union violate the DFR by not investigating the was entitled to select his own lawyer, whose fees would be
termination and advocating on Mwemera’s behalf? paid for by the union.

What does the employee “win” if their DFR complaint challenging the union’s decision to
drop their grievance is successful? As always, the purpose of a remedy is, as much as possible,
to return the victim to the situation they would have been in but for the illegal conduct. What
harm has an employee suffered when a union refuses to move forward with a grievance? In
the case of a termination grievance, that harm is not the loss of employment, because the ter-
mination may have been upheld had it gone to arbitration. The harm caused by the union’s
breach of the DFR is loss of the opportunity to challenge the employer’s termination decision
before an arbitrator. Therefore, the usual remedy in a successful DFR complaint over a union’s
decision to drop a grievance is an order by the labour relations board to “revive” the grievance
and send it to arbitration, sometimes with an accompanying order that the union pay for an
independent lawyer to represent the employee. That is what was ordered in the Mwemera de-
cision. If an arbitrator later reinstates the employee, the union may be ordered to pay a por-
tion of the damages owing to the employee that were caused by the delay associated with the
DFR proceedings.22
2. The Duty of Fair Representation and Collective Bargaining

As noted earlier, some jurisdictions include broad DFR provisions in their collective bargaining
statutes that apply to collective bargaining and collective agreement administration. Unions are
hardly ever able to obtain every improvement they initially set out to negotiate through collec-
tive bargaining. As bargaining progresses, they must give up some items to secure other items
deemed to be more important. However, reasonable employees can disagree on what is most
important, and some collective agreement items are zero-sum games—one group of employees
gain at the expense of another group of employees.
For example, in the City of Toronto collective bargaining that was described in the appendix
to Chapter 34, the employer (the city) initially sought the outright removal of collective agree-
ment language that restricted its right to dismiss employees and contract out their jobs. The
union sought to keep that protective language and proposed a 0 percent raise to win the em-
ployer over. After months of difficult negotiations, the union agreed to language that protected
employees with 15 years’ seniority or more from losing their jobs to contracting out and gave
those employees a small raise. However, employees with less than 15 years’ seniority could
thereafter be dismissed by the employer and their jobs contracted out to a private contractor.23
Should the union be faulted for making that agreement? Clearly the outcome is unfair to the
employees whose jobs are no longer protected. On the other hand, in a hostile climate, the union
managed to protect the continued employment of a large portion of the bargaining unit when
the employer had threatened to eliminate far more jobs and to impose its final offer on the
employees if they did not accept the employer’s proposal.
Because unions routinely must make difficult decisions in the face of competing employee
interests, they are given a wide latitude to decide what course of action is best. Union deci-
sions that benefit one group of employees over another do not violate the DFR, unless that
decision was arbitrary, discriminatory, or made in bad faith. In the case described in Box 37.4,
the union was confronted with a decision about how to treat the seniority rights of two groups
of employees following the merger of two job classifications into one. No matter what decision
the union made, one group of employees would be unhappy. Note how the labour relations
board assessed the union’s decision-making process. When unions run into DFR trouble in
relation to collective bargaining conduct, it is usually because union officials were dishonest
to the membership in the hope of pushing through a settlement, the union’s own rules or pro-
cedures were ignored, or preference was given to one group of employees over another for no
rational reason.24


The Duty of Fair Representation in the Collective Bargaining Process
Ormerod v. Unifor, Local Union No. 333-BC unit which has been designed to minimize industrial
2016 CanLII 36389 (BCLRB) unrest. … The simple fact of the matter is that not
all of the interests of these employees can be en-
Key Facts: The union represented a bargaining unit compris- tirely satisfied in any one set of negotiations. The
ing both large bus drivers (“transit operators”) and community union chosen by the employees to be their exclusive
shuttle operators (CTOs). Under the collective agreement, bargaining agent must have the authority … to
transit operators were paid more than CTOs and accumulated make the critical choices about which contract items
seniority from their date of hire. CTOs accumulated seniority will be negotiated with the employer: e.g., whether
from their date of hire too; however, if they later became transit to pursue healthy trade adjustments in lieu of a
operators, they did not carry their seniority with them but slightly higher across-the-board wage increase; or
rather started over at the bottom of the transit operator senior- whether to emphasize pension benefits instead of
ity list (they were “end tailed”). Over time, about 75 CTOs be- longer, paid vacations. As these examples indicate,
came transit operators under this scheme. In 2015, the the union’s decisions will favour some employees
employer and union agreed to eliminate the CTO classification and others may not like them. But it would be quite
and treat all drivers as transit operators based on the premise inconsistent with a system of free collective bargain-
that “a bus is a bus.” The union agreed that the 65 CTOs who ing if the Labour Board, later on, were entitled to
would now be required to become transit operators would make the judgment that such choices were un-
have their seniority merged (“dovetailed”) with the existing reasonable, unfair, and thus illegal.*
transit operator seniority list, rather than end tailed. As a result,
some of the CTOs being newly transferred into the transit The BC Labour Relations Board ruled that there was no
operator position would have greater seniority than existing evidence of bad faith: the union had explained to the employ-
transit operators who had lost their CTO seniority when they ees that the seniority list would be dovetailed and held meet-
became transit operators under the old model. The employees ings with employees to discuss the issue. There was no
overwhelmingly (89 percent) voted to accept the new collec- evidence of dishonesty or an attempt to hide the agreement.
tive agreement. However, a group of former CTOs who had Moreover, the union did not act in a discriminatory manner:
become transit operators and not been given credit for their there was no evidence that the union acted out of personal
CTO seniority filed a DFR complaint against the union. favouritism for the CTOs being transferred to the transit oper-
Issue: Did the union act arbitrarily, in a discriminatory manner, ators group. There was also no evidence that the union’s de-
or in bad faith by agreeing to merge the seniority lists of the cision to agree to the merged seniority list was arbitrary. The
CTOs and transit operators in the circumstances? union explained that many of the CTOs did not want to be-
come transit operators and perceived the elimination of their
Decision: No. The decision of the labour relations board began job as a hardship. The union believed that it would be doubly
by noting that it “has long taken the position that it takes a difficult on them to strip them of their seniority when they
‘hands off’ approach to collective bargaining” because the became transit operators. The BC Labour Relations Board ac-
parties generally know best how to balance the many compet- cepted that the union’s decision was rational under the cir-
ing interests involved in a typical bargaining relationship. It cumstances: no matter what solution the union agreed to
then cited approvingly an often-quoted passage from Sea- regarding the treatment of seniority, some employees would
grams Employees v. Distillery, Winery, Soft Drink & Allied Workers, be disadvantaged. The DFR complaint was dismissed.
a 1978 decision by the BC Labour Relations Board:
A trade-union is the legal bargaining agent for the * Seagrams Employees v. Distillery, Winery, Soft Drink & Allied Workers,
[1978] 1 CLRBR 375 (BCLRB).
entire unit of employees—often a large, all-employee
IV. The Decertification of Unions

Chapter 31 explained union certification, the legal process by which employees move from the
non-union common law regime to the unionized collective bargaining regime. A labour rela-
tions board can certify a union as the legal representative of all employees in a bargaining unit
union certification: A government-issued licence that entitles a union to represent employees in a defined bargaining unit in
their relationship with their employer.

if it is satisfied that a majority of employees wish to be represented by the union. Proof of ma-
jority support is proffered through one of two models. In the card-check model, the union must
collect union membership cards from a specified majority of bargaining unit employees. In the
mandatory certification vote model, the union must first collect union cards from a specified
percentage to qualify for the second step, a mandatory certification vote conducted by the
labour relations board. Once certified, the union is responsible for representing the bargaining
unit employees in collective bargaining and collective agreement administration until the
employees decide they no longer wish to be represented by the union.
In a system based on majority employee wishes, rather than an individual right to move back
and forth freely between collective bargaining and individual employment contracts, there must
be a process by which a majority of employees can escape the collective bargaining regime if
they desire. That process is known as “revocation of collective bargaining rights,” or sometimes
just “decertification” for short, and it is governed by specific rules found in collective bargaining
statutes. There are a variety of circumstances that can lead a labour relations board to “decertify”
a union.
A. Decertification Due to Loss of Majority Employee Support

Most commonly, a union is decertified because it is no longer supported by a majority of bar-
gaining unit employees. A bargaining unit employee can file an “application to terminate bar-
gaining rights” with the labour relations board, which triggers an inquiry by the board into the
union’s level of support. However, as with applications for certification, decertification applica-
tions can only be filed during narrow windows of time defined in the collective bargaining
legislation. For example, a newly certified union is protected from decertification applications
for between ten months and two years, depending on the jurisdiction, in order to give the union
a chance to negotiate an agreement and also to ensure a period of peace during which there is
no campaigning for and against unionization.25 During the term of a collective agreement,
decertification applications can only be filed in the open period near the end of the collective
agreement, which we discussed in Chapter 31.26 In some jurisdictions, applications for decerti-
fication are also restricted while the union and employer are in conciliation to reach a new col-
lective agreement (Ontario) or during all or part of the length of a strike or lockout (Alberta,
Manitoba, New Brunswick, Ontario, and the federal jurisdiction).
The decertification process is similar in design to the certification process in that the labour
relations board is tasked with measuring the level of employee support for the transition from
one regime to another. In the case of decertification, no professional union organizers are run-
ning the show, so employees need to take the lead themselves. Usually one or more employees
initiate the campaign. They research the process and get forms from labour relations board
websites (or speak to a lawyer or other knowledgeable person) and begin to collect the signa-
tures of bargaining unit employees on a document known as a decertification petition. The
card check: A method used in Canadian collective bargaining legislation to measure the level of employee support for union-
ization that involves counting the number of union membership or authorization cards. If a majority of employees have signed
cards, then the union is certified without a certification vote.
mandatory certification vote: A method used in Canadian collective bargaining legislation to measure the level of employee
support for unionization that involves the government conducting a secret ballot vote of bargaining unit employees.
open period: A period of time defined in a collective bargaining statute during which a union may apply to displace another
union as the representative of a group of employees, or during which unionized employees may file an application to “de-certify”
the union.
decertification petition: A form, signed by employees who no longer desire to be represented by a union, that is used as
evidence of employee support in an application to terminate the representational rights of a union.

petition requires employee names and signatures (dated and witnessed). By signing the petition,
employees declare they no longer wish to be represented by the union. After employee names
and signatures are collected, the petition is submitted to the labour relations board as part of the
application to terminate the union’s bargaining rights. Neither the employer nor the union is
supposed to learn the names of employees who have supported the petition.
The labour board reviews the decertification application to ensure that it is “timely” (filed
during a period in which decertification applications can be filed). If so, it begins the process of
assessing the level of employee support. This assessment requires a measure of the number
of bargaining unit employees who signed the decertification petition as well as the total
number of eligible voters (employees in the bargaining unit) to produce a percentage of em-
ployee support. The details of how Canadian governments measure employee support for decer-
tification are presented in Table 37.1. A majority of bargaining unit employees must express a
desire to remove the union for the decertification application to be successful.
TABLE 37.1 How Canadian Governments Measure Employee Support for Decertification
Level of Employee Support
Jurisdiction Needed to Apply for Decertification Test of Majority Support
Federal 40% plus one or more bargaining unit employees sign the A vote, and the majority of ballots cast
petition
Alberta 40% or more bargaining unit employees sign the petition A vote, and the majority of ballots cast
British 45% or more bargaining unit employees sign the petition A vote, and the majority of ballots cast
Columbia
Manitoba 50% plus one or more bargaining unit employees sign the A vote, and the majority of ballots cast
petition
New Brunswick 40% or more bargaining unit employees sign the petition A vote, and the majority of ballots cast by eligible voters,
which excludes employees absent from work on the day
of the vote
Newfoundland 40% or more bargaining unit employees sign the petition A vote, and the majority of ballots cast
and Labrador
Nova Scotia 50% plus one or more bargaining unit employees, or A vote, and the majority of ballots cast
a “significant number” of union members, sign the petition
Ontario 40% or more bargaining unit employees sign the petition A vote, and the majority of ballots cast
Prince Edward 50% plus one or more bargaining unit employees sign the A vote, and the majority of ballots cast
Island petition
OR
If the labour relations board is satisfied based on petition

evidence that a majority of employees no longer wish to
be represented by the union based on this evidence, it
may decertify a union without a vote
Quebec 50% plus one or more bargaining unit employees sign the A vote, and the majority of ballots cast
petition
OR
Support evidence; if the labour relations board is satisfied

based on petition evidence that a majority of employees
no longer wish to be represented by the union based on
this evidence, it may decertify a union without a vote
Saskatchewan 45% or more bargaining unit employees sign the petition A vote, and the majority of ballots cast

Importantly, employers must play no role in initiating, encouraging, supporting, or facilitat-

ing a decertification application. The decision whether to leave the collective bargaining regime
by decertifying the union is to be made voluntarily by the employees, and employer participa-
tion may be considered unlawful employer interference in the administration of the union (see
Chapter 32). The requirement that a decertification campaign be free of employer involvement
parallels the requirement that union certification be free of employer involvement.27 If the em-
ployer makes threats or uses coercion to pressure employees into applying to decertify the
union, or if it makes promises of rewards if they do so, such actions would amount to unfair
labour practices that would cause the labour relations board to dismiss the decertification appli-
cation. However, even if the employer’s participation is only supportive or encouraging, the
labour relations board may consider the application to be tainted. As a consequence, the labour
relations board may dismiss the application on the basis that the application does not reflect the
true wishes of the employees. Many decertification applications are dismissed by labour rela-
tions boards for this reason.
Employer support can include granting employees time off work; providing employees with
resources such as office space, materials, copiers, and fax machines to help them prepare the
decertification application; making promises to employees about working conditions should
a decertification application be successful; referring employees to a lawyer to help with the
decertification; or paying all or part of any legal fees incurred by employees who initiated
the application.28 Consider what role the employer played in decertification in the case dis-
cussed in Box 37.5.

Employer Interference in Decertification Efforts
Unionized Employees of Tenaquip v. Teamsters, Local Decision: Yes and yes. The OLRB summarized the evidence as
Union 419 follows:
1997 CanLII 15586 (Ont. LRB)
It is clear that signatures on the petitions were so-
Key Facts: A group of employees filed an application for de- licited during working hours; employees were sum-
certification of the union. The union filed a response with the moned to leave their work areas and to attend at the
labour relations board arguing that the employer had initiated boardroom for the purposes of a series of short in-
and supported the application and, thus, requested that the dividual meetings. The two lead petitioners spent a
application be dismissed. Two employees drove the campaign. cumulative total of close to an hour each away from
They posted a notice at work inviting employees to talk to their work duties. Each of the employees spent up
them about decertifying the union, and when no one re- to 5 minutes attending in the boardroom in addition
sponded, they summoned each employee to a company to the time travelling to and from the boardroom.
boardroom during working hours and presented them with a The petitioners’ open and notorious approach to the
petition to sign in support of the application. The two employ- solicitation of petition signatures may have created
ees claimed they had not asked the employer’s permission to something of a parade appearance for any
use the boardroom. On the day the application was signed, observer.
the two employees left work for two hours to file the applica-
tion to decertify. The employees claimed they never gave the The OLRB concluded that the employer must have been
employer a reason for their absence. aware of the employees’ efforts to campaign for decertification
at the workplace and condoned it:
Issue: Did the employer initiate the decertification applica-
tion by giving support to the two employees and, if so, I am persuaded that the employer made a contribu-
should the Ontario Labour Relations Board (OLRB) dismiss the tion to the application. That contribution was two-
application? fold. First, it permitted the petitioners’ activities and

thereby contributed resources (license to the peti- The fact that no employees responded to the initial notice
tioners to come and go during their working hours, about decertification but then most signed the petition when
use of the boardroom, access to employees during summoned to the boardroom is evidence that the employees
their working hours) which were significant to facili- believed the employer was involved. Without the employer’s
tating the application. But more importantly in this contribution in permitting the two lead employees to use
case, the employer, through its cooperation with company time to solicit support, the campaign may not have
and toleration of the petitioners’ activities, com- gotten off the ground. Therefore, the OLRB dismissed the
municated an explicit and important message to decertification application, finding that the employer effect-
employees that it supported the application. ively initiated the campaign.
In some jurisdictions, a failed decertification application results in a bar being imposed that
prohibits further applications for a defined period of time.29
B. Other Reasons for Decertification

Depending on the jurisdiction, collective bargaining legislation grants labour relations boards
discretion to order a union decertified for a variety of other reasons, including the following:
• The union failed to commence collective bargaining (Ontario and New Brunswick): If a
union fails to give the employer a “notice to bargain” or otherwise fails to commence
bargaining after a defined period of time (60 days in Ontario, 30 days in New Brunswick),
then a labour relations board can decertify the union for “sleeping on” its bargaining
rights.30
• The certification was obtained by fraud (Ontario, Manitoba, New Brunswick, Saskatch-
ewan, and federal): If a union’s application for certification was obtained by reliance on
fraudulent statements or documents, such as forged union membership cards, the labour
relations board can terminate the union’s certification.31
• The union “abandoned” its bargaining rights (Manitoba, British Columbia, Saskatchewan,
Alberta, and Ontario):32 If a union takes no steps to bargain a collective agreement or to
administer a collective agreement, a labour relations board may rule that the union has
“abandoned” or “slept on” its bargaining rights and decertify the union.
• The union was displaced by another union in a union raid: As discussed in Chapter 31, a
union can apply for certification of employees represented by a different union during
the open period. If a raiding union is successful, then the union that previously repre-
sented the employees is decertified and the new union replaces the old union as the
employees’ legal representative.
C. The Effects of a Successful Application for Decertification

What happens when a union is decertified? The short answer is that the union ceases to repre-
sent the employees any longer, any collective agreement that was in effect ceases to operate, and
the employees are suddenly thrust back into the common law regime.33 One moment, the
employees exist within the collective bargaining regime. The next moment, they have an indi-
vidual employment contract with their employer, and all the rules of the common law govern
that relationship (see Part II). But what are the terms of that employment contract?
One option is that the employee and employer return to a situation akin to a new common
law hiring, so that the terms of the individual employment contract must be bargained anew,
with a new offer, an acceptance, and mutual consideration (see Chapter 7). However, that
approach would be unworkable in practice, since the work itself must continue seamlessly, and

there would not usually be time for the employer to bargain new individual employment con-
tracts with the entire group of formerly unionized employees.34 Another option is that the for-
mer terms of the collective agreement simply carry over and become implied terms (see
Chapter 9) of the new individual employment contract. This option has the benefit of allowing
a seamless transition from the collective bargaining regime to the common law regime. If an
employee was earning $30 per hour and was entitled to 15 days of paid vacation under the old
collective agreement, then those entitlements become implied terms of the new individual
employment contract. If the (now non-union) employer subsequently cuts the employee’s pay
to $20 per hour or cancels the health and dental plan, the employee could bring a lawsuit in
court for breach of contract, including perhaps constructive dismissal (see Chapter 13).
Should all terms of the former collective agreement be implied into the new individual
employment contracts? For example, if the collective agreement required the employer to have
“just cause” to dismiss an employee, does that requirement carry over to the individual employ-
ment contrct, effectively ousting the normal common law right of employers to dismiss non-
union employees simply by giving notice of termination? Is the grievance and arbitration
provision of the old collective agreement implied into the employment contract, so that a dis-
missed employee must proceed to arbitration rather than file a wrongful dismissal lawsuit in
court?35 The case in Box 37.6 wrestles with these questions.

What Happens When Employees Decertify Their Union?
OSSTF v. Muskoka Board of Education ment and therefore violated the statutory freeze provisions in
[1996] OLRD No. 3369 (Ont. LRB), aff’d [1998] OJ No. 1354 (QL) the Labour Relations Act, 1995.
(Ct J (Gen Div))
Issue: Did the just cause provision in the old collective agree-
Key Facts: The custodial employees of the Muskoka Board of ment become an implied term of Blundell’s individual employ-
Education were represented by the Service Employees Union ment contract with the employer after the SEU was decertified?
(SEU) until September 25, 1995, when a majority of the em- If so, did the employer violate the statutory freeze provisions
ployees voted to decertify that union. Shortly thereafter, in by dismissing Blundell without just cause?
early October 1995, a new union (Ontario Secondary School
Decision: No and no. From the moment SEU was decertified,
Teachers’ Federation, or OSSTF) successfully applied to be
the employment relationship changed from one in which the
certified for the same employees. That certification triggered
employer was legally required to deal with the union as
the statutory collective bargaining freeze (see Chapter 33),
Blundell’s bargaining representative to one governed by the
during which time the employer could not alter any terms or
common law of the individual employment contract. The
conditions of employment without the union’s consent. In
terms of the expired collective agreement “which relate dir-
November 1995, still during the statutory freeze period, an
ectly to the individual employer-employee relationship” are
employee named Blundell was dismissed for innocent absen-
implied into the individual employment contract “unless there
teeism due to a prolonged absence related to a disability.
is an agreement to the contrary, or other circumstances from
Blundell filed a grievance challenging the termination as lack-
which there may be implied terms and conditions of employ-
ing just cause. The employer replied that since the old collec-
ment different from those set out in the collective agreement.”
tive agreement between SEU and the employer was no longer
However, terms in the collective agreement that confer collec-
in effect, the just cause provision in it no longer applied and
tive rights and rights on the union (as opposed to the em-
Blundell’s terms of employment were governed by the com-
ployee) cannot be implied into an individual employment
mon law of the individual employment contract. OSSTF filed
contract.
a complaint with the labour relations board on behalf of
Therefore, the terms of the expired collective agreement
Blundell, arguing that the just cause term of the old collective
that applied to Blundell’s individual employment contract, and
agreement carried over into the new individual employment
that were “frozen” when the OSSTF applied for certification,
contract of Blundell, so that when the employer fired Blundell
were those that related to individual employee rights but
without just cause, it effectively altered a condition of employ-

not to collective rights. The OLRB ruled that the expired col- lenge to the employer’s assertion of “just cause” for
lective agreement conferred a right on the union to challenge discharge, through the grievance and arbitration
terminations as lacking just cause, but not on individual em- process. … Mr. Blundell’s right to challenge his dis-
ployees, as explained in the following passage: missal was governed by the common law, and the
appropriate procedure for remedying any breach of
In our view, “just cause” protection in the collective the common law was a [wrongful dismissal] action
agreement between SEU and the MBE confers rights in the Courts … [where] the court would apply the
of a collective nature ON THE [SEU], not of an indi- common law standard of “cause.”
vidual nature on the individual bargaining unit em-
ployee. This “just cause” protection does not survive Since Blundell’s employment contract did not include a
the termination of the collective agreement. After term stating that he could only be dismissed for just cause,
[SEU was decertified], the employees, including Mr. the employer did not violate the statutory freeze provisions
Blundell, correspondingly lost the right [to] file a in the Labour Relations Act, 1995, even if it had dismissed
grievance and to request the union to pursue a chal- Blundell without just cause. The complaint was dismissed.
In the OSSTF v. Muskoka Board of Education decision, the OLRB ruled that parts of the col-
lective agreement that regulate the relationship between individual employees and the employer
are implied into the employment contract after decertification, absent agreement to the con-
trary, but not those parts that deal with the collective relationship between the union and the
employer. Since the collective agreement conferred the decision whether to arbitrate a matter of
just cause on the union and not the employee, the just cause provision did not carry over as an
implied term of the employee’s individual employment contract. Had the collective agreement
granted employees a personal right to challenge their dismissal as lacking just cause, then the
just cause term may have been implied into the contract.36 In most cases, employees immedi-
ately forfeit the just cause protection that existed under the collective agreement once the union
is decertified and instead become subject to the common law rules regulating termination of
employment contracts, discussed at length in Part II.
V. Chapter Summary

With this chapter on decertification, we have come full circle in this text. We have learned how
employees transition from the common law regime to the collective bargaining regime and then
back again. Because unions may possess significant institutional powers, the courts and govern-
ments recognized the need to regulate unions to ensure that they can be held responsible for
their conduct. In the common law regime, although judges have long held individual union
officials personally responsible for their deeds through tort and sometimes criminal law, the
courts have struggled in assigning a distinct legal personality to unions. Recently, the courts
have overcome this challenge by ruling that, by imposing extensive legal rights and responsibil-
ities on unions, collective bargaining statutes have effectively given unions the legal status to act
in their own capacity. A significant legal responsibility imposed on unions in Canada is the duty
of fair representation. This chapter explored the scope of that obligation and noted that unions
have been given considerable deference to make difficult decisions, provided that those deci-
sions are based on a fair consideration of facts and issues and not tainted by discrimination or
bad faith.

1. Describe the basis on which the Supreme Court of Canada ruled that unions have legal
status to sue and be sued in their own right in Berry v. Pulley. Had the original union
(CALPA) violated the union constitution in that case? Why or why not?

2. Describe the substance of the DFR (the three types of behaviour that unions are required
to avoid). Provide an example of each type of behaviour.
3. Is it a violation of the DFR for a union to make a decision that disadvantages one of its
members? Explain your answer.
4. Describe the process by which employees can decertify their union in your home
province.
5. What happens to employees’ terms and conditions of employment when the union that
had represented them is decertified?
APPLYING THE LAW

1. Jenny and some of her co-workers want to decertify The employer claims that a video shows Donald taking
their union, but they aren’t sure how to do it. Jenny the gift certificates from an envelope he was process-
asks her manager for advice. The manager tells Jenny ing and putting them in his pocket. Donald denies that
that he can’t help her decertify the union, but he pro- he got the certificates from the workplace and says
vides her with the name of a labour lawyer and tells they were a birthday gift. Donald’s union filed a griev-
her she would not be disciplined if she missed some ance alleging unjust dismissal. The union representa-
work to meet with the lawyer. Jenny meets with the tive meets with the employer to hear its version of the
lawyer the next day, and after collecting signatures on events. He watches the video, which is too unclear to
behalf of 40 percent of her bargaining unit colleagues, see what Donald is doing. However, even though Don-
she files an application to terminate the union’s bar- ald has no prior discipline, the union representative
gaining rights. has never trusted Donald, thinks he will be a bad wit-
a. Does Jenny have enough support to obtain a de- ness, and he believes Donald probably stole the gift
certification vote in your province? certificates. Also, Donald once criticized the union rep
b. Some employees learn that the manager referred in an open meeting, and the rep has always been an-
Jenny to the lawyer and gave her time off to meet noyed about that. The union rep decides to drop the
the lawyer, and they inform the union. What argu- grievance. Donald files a duty of fair representation
ment would you make in response to the applica- complaint.
tion on behalf of the union? a. What would Donald argue in his complaint?
2. Donald was fired from his job of 20 years at Canada b. If Donald wins his DFR complaint, what remedy
Post after the employer accused him of mail theft would likely be ordered by the labour relations
after several gift certificates were found in his bag. board?

1. Orchard v. Tunney, [1957] SCR 436; and Berry v. Pulley, Canada, 2011 ONSC 712; and Fullowka v. Pinkerton’s of
2002 SCC 40. Canada Ltd., 2010 SCC 5.
2. See, for example, Birch v. Union of Taxation Employees, 3. Rights of Labour Act, RSO 1990, c. R. 33, s. 3(2).
2008 ONCA 809 (a union lawsuit against members for 4. Ogden Entertainment Services v. United Steelworkers of
breach of the union constitution for crossing a picket line America, Local 440, 1998 CanLII 14755 (Ont. SC). Note
was dismissed because the contract clause was uncon- that the named representative individuals are not person-
scionable); McNairn v. United Association of Journeymen ally liable for damages; only the union’s assets can be
and Apprentices of the Plumbing and Pipe Fitting Industry assessed. See Nipissing Hotel Ltd. et al. v. Hotel & Restau-
of the United States and Canada, Local 179, 2004 SKCA 57; rant Employees & Bartenders International Union et al.,
Williams v. Telecommunications Workers Union, 2012 1963 CanLII 149 (Ont. H Ct J); Seafarers International
ABCA 284; Hokanson v. Sheet Metal Workers International Union of Canada et al. v. Lawrence, 1977 CanLII 1083
Association, Local 280, 1985 CanLII 690 (BCSC); Kiewning (Ont. H Ct J); and Choice Environmental Ltd. v. Tri-Phase
v. Communications, Energy and Paperworkers Union of Environmental Inc., 2011 CanLII 84637 (Ont. LA)

(Surdykowski). But see Public Service Alliance of from a duty to represent employees fairly in “grievance or
Canada v. Canada (Attorney General), 2002 CanLII 19258 rights arbitration” in the old language to a more general
(Ont. CA) (unions certified under federal collective bar- duty to represent employees fairly with regard to rights
gaining legislation are not barred from civil actions by the “pursuant to a collective agreement or this Part” of the Sas-
Rights of Labour Act because they do not depend on katchewan Employment Act, SS 2013, c. S-15.1. At the time
Ontario Labour Relations Act, 1995 for their existence); of writing, the board had not elaborated on the signifi-
and Kiewning v. Communications, Energy and Paper- cance of this change. See the discussion in C.B. v. Can-
workers Union of Canada, supra note 2; and Lawrence v. adian Union of Public Employees, Local 21, 2015 CanLII
International Brotherhood of Electrical Workers, 2017 90524 (Sask. LRB).
ONCA 321. 15. The Canada Industrial Relations Board has ruled that the
5. This tension has long been the subject of academic debate. DFR provision in the Canada Labour Code (RSC 1985, c.
See, for example, B. Adell, “Collective Agreements and In- L-2) applies to collective bargaining as well as contract
dividual Rights: A Note on the Duty of Fair Representa- administration. See Cairns, 2001 CIRB 111.
tion” (1985-86) 11 Queen’s LJ 251. 16. A good discussion of the differences in DFR scope appears
6. Steele v. Louisville & Nashville Railroad, 323 U.S. 192 in Complainant 6226 v. Canadian Auto Workers, Local
(1944). See the discussion of the development of the 4600, 2011 CanLII 21920 (NSLB).
American duty of fair representation law in P. Secunda 17. Alberta Labour Relations Code, RSA 2000, c. L-1,
et al., Mastering Labor Law (Durham, NC: Carolina Aca- s. 153(1).
demic Press, 2014) at chapter 18.
18. Gendron v. Supply and Services Union of the Public
7. Vaca v. Sipes, 386 U.S. 171 (1967). Service Alliance of Canada, Local 50057, supra note 11.
8. H.D. Woods, A.W.R. Carrothers, J. Crispo, & G. Dion, See also Judd v. Communications, Energy and Paper-
Canadian Industrial Relations, Report of the Task Force on workers Union of Canada, Local 2000, 2003 CanLII
Labour Relations (Ottawa, ON: Queen’s Printer, 1968) at 62912 (BCLRB); Caddy v. B.C. Government and Service
104. See the discussion of the evolution of the Canadian Employees’ Union, 2004 CanLII 34983 (BCLRB) (the
DFR in Rayonier Canada (BC) Ltd. v. IWA, Local 1-217, union’s failure to investigate facts and make an in-
[1975] 2 CLRBR 196 (BCLRB) at 200. formed assessment amounts to arbitrary conduct); and
9. Ontario Labour Relations Act, 1995, SO 1995, c. 1, Canadian Union of Postal Workers v. Lang, 2017 FCA
Sched. A, s. 74. 233 (failure of the union to fully investigate prior to
withdrawing a grievance).
10. See Robson v. Canadian Union of Public Employees, Local
3339, 2019 NBCA 55; Burns et al. v. National Automobile, 19. Anonymous Applicant v. CAW-Canada, Local 40, 2012
Aerospace, Transportation and General Workers Union of CanLII 34216 (Ont. LRB); Coppins v. United Steelworkers,
Canada (CAW-Canada, Local 219 et al.), 2012 NBCA 13; Local 7689, 2016 CanLII 79633 (Sask. LRB); and Toronto
Hedges v. National Automobile, Aerospace and Agricultural Transit Commission, [1997] OLRD No. 3148.
Implement Workers Union of Canada, 1996 CanLII 3728 20. See Rayonier Canada (BC) Ltd., supra note 8; and Caddy,
(PESCTD); and Lanigan v. PEITF, 2015 PESC 36. supra note 18.
11. Gendron v. Supply and Services Union of the Public Service 21. Canadian Merchant Service Guild v. Gagnon et al., [1984] 1
Alliance of Canada, Local 50057, [1990] 1 SCR 1298; and SCR 509. See also Noël v. Société d’énergie de la Baie James,
Bakaluk et al. v. Western Star Trucks Inc. et al., 2004 BCSC 2001 SCC 39.
417. 22. Anonymous Applicant, supra note 19.
12. Smith v. United Food and Commercial Workers’ Inter- 23. D. Dale & T. Boyle, “City Workers to Get 6% Pay Hike over
national Union, Local 1518, 2004 CanLII 65553 (BCLRB). Four Years” (February 2012), Toronto Star, online:
See also Elliott v. Canadian Merchant Service Guild et al., <https://www.thestar.com/news/city_hall/2012/02/13/
2008 PSLRB 3 (DFR does not apply to union’s conduct city_workers_to_get_6_pay_hike_over_four_years.html>.
during representation of employee before workers’ com-
24. See, for example, Diamond Z Association, [1979] OLRB
pensation tribunal); and Legault v. AEFO, 2001 CanLII
Rep. Oct. 791; and Ahokas v. CUPE, Local 87, 1983 CanLII
17634 (Ont. LRB).
895 (Ont. LRB).
13. Interior Systems Contractors Association of Ontario, [1995]
25. Most jurisdictions ban decertification applications for
OLRB Rep. Aug. 1082; and Petingola v. United Food &
between 10 and 12 months from the date of certification.
Commercial Workers Union, Local 1000A, 2010 CanLII
Saskatchewan bars applications for two years from the date
56878 (Ont. LRB).
of certification: see Saskatchewan Employment Act, supra
14. The Saskatchewan DFR language was recently amended in note 14, s. 6-17(4).
a manner that appears to broaden the scope of the DFR

26. See, for example, Ontario Labour Relations Act, 1995, 32. The Ontario Labour Relations Act does not expressly rec-
supra note 9, ss. 63, 67. ognize “abandonment” as a statutory basis for ordering
27. Ibid, s. 15. decertification, but the OLRB has read in that authority.
See J.S. Mechanical, [1979] 2 CLRBR 87 (Ont. LRB).
28. See, for example, Fleischmann v. Universal Workers Union,
L.I.U.N.A. Local 183, 2014 CanLII 12266 (Ont. LRB); 33. See, for example, Ontario Labour Relations Act, supra note
Empco-Fab, [1982] OLRB Rep. 1162 (the employer paid 9, s. 63(18) (collective agreement ceases to operate upon a
the legal fees of employees initiating the decertification board order decertifying a union); and Canada Labour
campaign); George Stinson v. International Brotherhood of Code, supra note 15, s. 42.
Electrical Workers Local 105, 2016 CanLII 53492 (Ont. 34. Isidore Garon ltée v. Tremblay; Fillion et Frères (1976) inc. v.
LRB) (the employer worked closely with decertification Syndicat national des employés de garage du Québec inc.,
application organizers to assure employees that nothing 2006 SCC 2 at para 27.
bad would happen if the union were decertified); and 35. See the discussion in Re Telegram Publishing Co. Ltd. v.
Unionized Employees of Tenaquip v. Teamsters, Local Union Zwelling et al., 1975 CanLII 580 (Ont. CA) (the terms of an
419, 1997 CanLII 15586 (Ont. LRB) (the employer pro- expired collective agreement that relate to the individual
vided time off and office time to help the campaign). employment relationship become implied terms of the
29. See, for example, Ontario Labour Relations Act, supra note employment contract); Mental Health Hospital v. Alberta
9, s. 111(2)(k); and BC Labour Relations Code, RSBC 1996, Union of Provincial Employees, 1986 ABCA 117; Sullivan v.
c. 244, s. 33(3). Victoria Golf Club, 1994 CanLII 2622 (BCSC); and Isidore
30. See Ontario Labour Relations Act, supra note 9, s. 65; and Garon ltée v. Tremblay; Fillion et Frères (1976) inc. v. Syndi-
NB Industrial Relations Act, RSNB 1973, c. I-4, s. 24. cat national des employés de garage du Québec inc., supra
note 34.
31. See, for example, Ontario Labour Relations Act, supra note
9, s. 64; Saskatchewan Employment Act, supra note 14, s. 36. In Sullivan v. Victoria Golf Club, supra note 35, the court
6-109; Canada Labour Code, supra note 15, s. 40; Mani- ruled that the grievance and arbitration provisions of the
toba Labour Relations Act, CCSM c. L10, s. 52; and NB collective agreement carried over into the individual
Industrial Relations Act, supra note 30, s. 26. employment contract after the union was decertified.

CHAPTER 38
Public Sector Labour

Relations*
II. Terminology: What Is the “Public Service”? Who Is “the
• Understand some of the reasons why labour laws are different in the Employer”? Who Is a “Public Servant”? 662
public and private sectors. A. What Is the “Public Service,” and Who Is “the Employer” in
• Understand what an essential service is and how this designation affects Public Service? 662
the right to strike. B. Who Is a “Public Servant”? 664
• Identify which topics cannot be collectively bargained in the public III. Distinguishing Features of Public Sector Collective Bargaining
sector. Law and Policy 665
A. Essential Services 665
• Describe the two types of interest arbitration and the five principles that
B. Public Sector Strike and Picketing Rules 668
interest arbitrators apply when making awards.
C. Limits on Topics That Can Be Collectively Bargained 668
• Understand the duty of fidelity in the public service, and how this duty D. Interest Arbitration 669
is balanced against protecting free speech in general and whistle-
E. Bargaining Unit Composition 672
blowers in particular.
IV. Implications of Public Servants’ Duty of Fidelity 672
I. Introduction
In many respects, the legal rules that govern the public and private sectors are similar. For ex-
ample, the laws governing union certification, unfair labour practices, and grievance arbitration
(all considered elsewhere in this text) are mostly the same in the two sectors. However, in other
respects, important differences exist in the labour laws that apply to the public service. Those
differences are the focus of this chapter, and they relate to the following areas:
• The rules concerning essential services.

• Strike and picketing rules.
• The limits on topics that can be collectively bargained.
• The use of interest arbitration instead of strikes and lockouts.
• The composition of bargaining units.
• The implications of the duty of fidelity of public servants to the Crown.
Why does the public sector require a special legal regime? What makes the public service
exceptional? Generally, there are three reasons given for this exceptionalism.
* This chapter was authored by Christopher C. Rootham in partnership with Nelligan O’Brien Payne.
661

The first reason is the government’s need to protect the public. The government’s overriding
responsibility is to the public interest, and the public interest needs to be taken into account
when determining the collective bargaining rights of employees.1 The need to protect the public
is particularly pertinent when considering whether public servants who perform an essential
service have the right to strike. Public service strikes can greatly inconvenience the public with-
out causing economic harm to the government. Therefore, essential services legislation is in
place to protect the public interest.2
The second reason is that the locus of bargaining authority is more diffuse in the public sector
than it is in the private sector. In the private sector, it is common for a single person (or a small
committee of people) to have the ultimate authority to bind the employer in collective bargain-
ing. In the public sector, by contrast, it is difficult to find a single person with authority because
governments are, by their nature, consultative bodies where decisions are made after input from
a number of different people and interests.
The third reason is the sovereign nature of the state as employer. The government, or the
Crown, has sovereign authority in Canada, meaning that it possesses ultimate authority to es-
tablish the laws of Canada. Some consider it a mistake for the Crown to voluntarily limit its
sovereign authority through collectively bargaining with its employees. As Quebec Premier Jean
Lesage put it back in the early 1960s: “The Queen does not negotiate with her subjects.”3
These three reasons are often unsatisfactory in explaining the differences between public and
private sector collective bargaining law. Nevertheless, they are the commonly stated reasons for
these differences, and the actual differences can often be explained by considering one or more
of these three reasons.
II. Terminology: What Is the “Public Service”? Who Is “the

Employer”? Who Is a “Public Servant”?
The first step in this chapter is to define key terms and identify the employer in public sector
collective bargaining.
A. What Is the “Public Service,” and Who Is “the Employer” in Public Service?
What is the public service? The “public service” needs to be distinguished from the “public sec-
tor” (sometimes referred to as the “broader public sector”). The easiest way to think of the public
sector is as a series of concentric circles (see Figure 38.1). The innermost circle is the core public
service. The public service is controlled directly by the central financial planning agency for the
particular government being considered—for example, the Treasury Board federally, or the
Management Board of Cabinet in the province of Ontario. This central financial planning
agency is responsible for all of the human resource functions within this innermost core. Feder-
ally, this innermost core is called the “core public administration.”
Crown: The Crown in Canada is Her Majesty in right of Canada or in right of a province. The Crown is a synonym for the
government.
public service: The public service comprises those departments and agencies that are controlled and managed directly by a
central financial planning agency of the Crown. It is distinct from the public sector, which receives funding from the government
but is responsible for its own management.
Treasury Board: A committee of the Queen’s Privy Council (i.e., Cabinet) comprising the minister of finance and four other
Cabinet ministers. The actual work of the Treasury Board is done by its administrative arm—the Treasury Board Secretariat. The
Treasury Board Secretariat essentially manages the public service, including its collective bargaining and other human resource
functions.

Chapter 38 Public Sector Labour Relations 663
FIGURE 38.1 Map of the Public Sector
Broader public sector

(e.g., school boards, public hospitals)
Crown corporations
(e.g., CBC, Royal Ontario Museum,
Alberta Gaming and Liquor Commission)
Separate agencies
(e.g., Canada Revenue Agency,
eHealth Ontario)
Core public service

(e.g., Health Canada,
Ontario Ministry of Transport)
The next concentric circle comprises those agencies or organizations that have authority over
their own human resources but are still controlled to some extent by the central financial plan-
ning agency. These agencies sign their own collective agreements, design their own staffing
rules, and have their own human resource policies; however, those collective agreements, rules,
and policies are still reviewed and, to some extent, approved by the central financial planning
agency. Federally, these agencies are called “separate agencies”; in Ontario, they are called “pub-
lic bodies”; and they have other names in some other provinces. For example, Canada Revenue
Agency is a separate agency in the federal government; and eHealth Ontario is a public body in
Ontario. Not every province uses this concentric circle: British Columbia, for example, has one
collective agreement for all ministries and agencies. In other words, British Columbia only has
its equivalent of the core public service.
The next concentric circle comprises Crown corporations. Crown corporations are corpor-
ations wholly and directly owned by the government. They are responsible for their own collec-
Crown corporation: A corporation wholly and directly owned by the provincial or federal Crown.

tive bargaining and human resource management and are run by an independent board of
directors; however, they are still responsible to their shareholder—the government. The Can-
adian Broadcasting Corporation, the Alberta Gaming and Liquor Commission, and the Royal
Ontario Museum are three examples of the hundreds of Crown corporations across Canada.
The outermost circle is commonly referred to as the broader public sector. Broader public
sector employers are funded entirely by the federal or provincial government, but collective
bargaining typically occurs at the local or organizational level. Health care and education are
sectors with public sector employers. In both of these sectors, provincial governments are still
experimenting with the degree of centralization that should be used for collective bargaining.
Ontario, for example, uses a form of two-tiered bargaining for its teachers: some issues are
negotiated at the school-board level, and other issues (including wages) are negotiated on a
province-wide basis.
This chapter will address collective bargaining by organizations in the two innermost con-
centric circles only; that is, organizations where the employer is either the central financial
planning agency (e.g., the federal Treasury Board) or a separate agency designated by the gov-
ernment. Typically the third and fourth circles are governed by the usual private sector collective
bargaining laws we have explored throughout Part IV, or by sector-specific statutes (e.g., in
education, policing, and health care) that include variations on that basic model.4
B. Who Is a “Public Servant”?

The final preliminary issue is, Who is a public servant? In Chapter 4, the common law tests for
distinguishing between an employee and an independent contractor in the private sector were
explored. Those tests apply to public service workers as well. In addition, however, the various
statutes governing the public service in each jurisdiction set out certain formalities of appoint-
ment before a person becomes a public servant. In the absence of those formalities, an indi-
vidual is not a public servant (and therefore is governed by the private sector collective
bargaining model), no matter how much control is being exercised over that individual or how
dependent they are on the public service. See Box 38.1.

Defining “Public Servant”
Canada (Attorney General) v. Public Service Alliance of provided their equipment, and otherwise controlled their em-
Canada ployment. However, the contract also specified that the teach-
[1991] 1 SCR 614 ers were not employees of the government. PSAC filed an
application with the Public Service Relations Board arguing
Key Facts: The federal government (the Solicitor General) had that the teachers were in fact employees of the government,
hired a number of teachers to provide educational programs applying the usual tests for determining whether a worker was
for prison inmates. Those teachers were public servants and in an employee or a contractor (see Chapter 4). The employer
a bargaining unit represented by the union Public Service Al- challenged that decision in the courts, arguing that since the
liance of Canada (PSAC). However, in 1984, the Solicitor Gen- teachers had not been formally appointed to the public ser-
eral decided to privatize these services and entered into a vice, they could not be government employees.
contract with a private educational company named Econosult
to provide these programs through teachers hired by Econo- Issue: Were teachers who were under the control of the gov-
sult. Through its contract with Econosult, the Solicitor General ernment but not formally appointed to the public service
set the pay rates for the teachers, set their hours of work, considered to be government employees?
broader public sector: Those sectors of the economy that are funded predominantly or exclusively through taxpayer money,
and that have management that is independent from the government.
public servant: An employee formally appointed to the public service following the requirements of legislation.

Decision: No. Despite the fact that the government exercised public service are within the exclusive rights and
control over the teachers, the Supreme Court of Canada con- authority of the Public Service Commission. Excep-
cluded that the teachers were not “employees” because they tions are carefully spelled out in the Employment
had not been formally appointed by the Public Service Com- Act. … In the scheme of labour relations which I
mission in accordance with the Public Service Employment Act. have outlined above there is just no place for a spe-
The Supreme Court stated: cies of de facto public servant who is neither fish nor
fowl.
The positions in the Public Service are determined
by the Treasury Board and appointments to the
III. Distinguishing Features of Public Sector Collective Bargaining

Law and Policy
As noted above, while much of the law that governs the public service is the same as or similar
to that governing private sector employees, there are important differences. The remainder of
this chapter examines those key distinguishing features.
A. Essential Services

An important difference between the public and private sectors is that essential services are
prevalent in the public sector. We briefly considered essential services in Chapter 34 in relation
to interest arbitration. While private sector collective bargaining statutes sometimes include
rules relating to essential services,5 essential services provisions are an integral part of the law
governing the public service. There are, broadly speaking, three models for dealing with strikes
in essential services:
1. The “no strike” model, where strikes and lockouts are illegal.
2. The “unfettered strike” model, where the standard strike/lockout regime applies.
3. The “designation” model, where strikes are permitted but certain workers or positions
are designated as essential to ensure that enough workers remain at work during a strike
to ensure that essential services are continued.
In Canada, the “no strike” model is used in certain circumstances where any strike would
unduly impact essential services. For example, police officers and firefighters are prohibited
from striking throughout Canada. The “unfettered strike” model is used typically for the third
and fourth concentric circles discussed above (Crown corporations and, sometimes, the educa-
tion sector). In most other situations, however, the “designation” model prevails.
The first step in applying the designation model is to determine what an essential service is.
While the definition of essential service varies slightly from jurisdiction to jurisdiction, the core
concept is that an essential service is one that affects the safety or security of the public. For ex-
ample, the Alberta Labour Relations Code defines essential services as those services
(a) the interruption of which would endanger the life, personal safety or health of the public,
or
(b) that are necessary to the maintenance and administration of the rule of law or public
security.
Unions and employers have argued for definitions of health, safety, and security that are
either extremely narrow or very broad, respectively. For example, unions have often taken the
essential services: Services that are essential to protect the health, safety, or security of the public. For example, police officers,
firefighters, and medical practitioners perform essential services. Some governments consider services that are important to the
public, such as public transit or mail delivery, as essential services as well.

position that safety and security means only circumstances of imminent physical danger, while
employers have argued that safety and security encompasses emotional as well as physical well-
being. Labour relations boards and the courts have typically taken a midway point between
those two extremes: “safety and security” has been interpreted as more than simple economic
inconvenience, but less than imminent national danger. Essential services legislation does not
immunize the government or the country from economic harm from a strike, nor does it permit
the government to carry on business as usual. However, it does guard against the probability or
even the possibility of harm or injury to the health or physical well-being of individuals.
In the case considered in Box 38.2, the labour board found that public transit was not an
“essential service” that justified restricting the right of employees to strike. However, in 2011, the
Ontario government passed a law that effectively declared transit services provided by the
Toronto Transit Commission (TTC) to be essential services. The preamble to that law provided
that work stoppages at the TTC “give rise to serious public health and safety, environmental, and
economic concerns.”6

Determining Which Employees Are Essential Employees
Amalgamated Transit Union, Local 0591 v. Société de Decision: No. The Canada Industrial Relations Board stated
transport de l’Outaouais that essential services legislation “is aimed specifically at pre-
2017 CIRB 849 venting an immediate and serious danger to the safety or
health of the public. The section does not give the Board juris-
Key Facts: The employer, Société de transport de l’Outaouais diction to deal with other matters in the public interest that
(STO), is a public transit service serving a population of ap- might be impacted by a labour dispute.” The board also clari-
proximately 275,000 people. The STO argued that, in the event fied that “any restriction of the right to strike must be limited
of a strike, there would be more vehicles on the road (as transit to what is strictly necessary and solely to ensure the health
riders would drive to work instead), and that in turn this would and safety of the public.” The board concluded that the STO
decrease the response time for ambulance services and fire- did not prove that ambulances or firetrucks would be signifi-
fighters. The employer also argued that the absence of public cantly delayed as a result of increased traffic during a transit
transit would impact the public’s psychological and physical strike. The board also concluded that while a transit strike
health owing to increased stress and deteriorating air quality. would have a negative effect on air quality, there was no evi-
The employer therefore argued that bus services needed to dence about the precise “risk level” to the public as a result.
be maintained during “peak hours” of 6:00 to 9:00 a.m. and 2:30 The board finally concluded that the increased stress of a
to 6:00 p.m. longer commute did not rise to the level of an immediate and
Issue: Is transit service necessary to prevent an immediate and serious risk to the psychological health of the public. Therefore,
serious danger to the safety or health of the public? STO’s application was dismissed.
Some other examples of essential and non-essential services are listed in Table 38.1.
The burden of proof in each case rests with the employer. The employer must place evidence
before the labour relations board to convince it that a reasonable basis exists for finding that a
service is essential.7

TABLE 38.1 Essential and Non-essential Services

Essential Services Non-essential Services
Nursing care at a mental health centre Research activities by nurses at a mental health centre
Data processors for welfare programs, the with- Data processors for other welfare programs
drawal of which is likely to create a risk or hazard to
the health of the recipient
Recreational activities for residents of a centre Recreational activities provided to the general public
catering to vulnerable individuals with develop-
ment disabilities
Border officers who conduct inspections and decide Border officers who assess and collect duties, taxes,
appropriate actions to maintain border security fees, and fines
Parks Canada workers who monitor forest fires,

coordinate search-and-rescue operations, pilot
search-and-rescue vehicles, ensure the integrity of
the water supply within parks, and ensure proper
handling and storage of garbage (to reduce the risk
of bear attacks)
One of the significant issues in essential services is whether employees must perform their
“whole job” during a strike, or whether they only have to perform the part of their job that is
found to be essential. A similar issue is whether the government has the unilateral authority to
dictate the level of service that needs to be provided once the service has been found to be es-
sential. In most jurisdictions, these issues are negotiated between the employer and the union,
who enter into an essential services agreement that governs these and other issues relating to
essential services. The federal government, by contrast, has reserved the right to dictate the level
of service that needs to be provided by its employees, and the Supreme Court of Canada has
upheld that rule in a decision called C.A.T.C.A. v. The Queen.8 In the years immediately after the
C.A.T.C.A. decision, 60 percent of federal public service bargaining units had over half of their
members designated as essential, and 35 percent had all or virtually all of their members desig-
nated as essential—demonstrating that this is an important issue that can substantially restrict
the right to strike.
Another issue that arises in essential services is the notion of “job bundling.” Imagine that
there are three employees, each of whom spends a third of their time performing essential ser-
vices. In this scenario, are all three employees expected to work full time during a strike, or must
the essential components of the jobs be “bundled” so that only one employee is declared essen-
tial and works full time? Job bundling in this limited sense is typically permitted, subject to the
terms of an essential services agreement, but does not extend beyond this basic concept. For
example, an employer is not expected to require some employees to work overtime so that
others can strike. An employer is also not expected to reassign managers or other employees
excluded from the bargaining unit to perform these essential duties.
Finally, the interaction between replacement workers and essential services varies from prov-
ince to province. In British Columbia, the labour relations board has concluded that an em-
ployer cannot require essential services workers to attend work while at the same time hiring
essential services agreement: An agreement between an employer and a union that identifies which and how many
employees are “essential” to protect public safety and therefore cannot participate in a work stoppage.

replacement employees;9 in Ontario, by contrast, the labour relations board concluded that it
did not have the jurisdiction to prevent an employer from hiring replacement workers at the
same time as preventing other essential services employees from striking.10
B. Public Sector Strike and Picketing Rules

If an essential services regime is in place and the parties have been unsuccessful in bargaining,
the union may call a strike on behalf of its members. Most of the rules concerning strike activity
(discussed in Chapter 34) in the private sector are similar in the public sector and spelled out in
detail in the labour legislation of each jurisdiction. For example, public sector strike rules
address rules relating to mandatory government conciliation, the requirement and timing of
strike votes, and whether notice of a strike to the employer is required. The rules also address
limits on the right to strike while Parliament or the legislature is not in session and other
government-specific concerns.
Sometimes there are disputes over whether public sector strikes are economic or political in
nature. In the private sector, a strike is ultimately an economic weapon: a strike causes (or at
least is intended to cause) the employer to lose money, and so the question of when or how to
settle a strike is largely an economic question. Public sector strikes are different. The government
does not lose money during a strike—on the contrary, it saves money by not having to pay its
striking employees while it continues to collect taxes; we all have to keep paying our taxes even
if there is a public sector strike. Strikes in the public sector are ultimately political battles. The
unionized workers are attempting to put enough political pressure on the government to resolve
the strike favourably, and whether or not public sympathy is on their side can strongly influence
the government’s bargaining position.
Despite the inherently political nature of public sector strikes, many courts have been reluc-
tant to characterize such strikes as inherently “political” instead of “economic” in nature. This
may have something to do with a concern that characterizing public sector strikes as a form of
political speech could leave laws that restrict strikes (see Chapter 34) vulnerable to a challenge
under the Canadian Charter of Rights and Freedoms (see Chapter 39). The courts have tended
to focus on the actual issues at stake in the strike. If the issues relate primarily to working condi-
tions, then the strikes are economic;11 if the issues are about the content of legislation or gov-
ernment policy, then the strikes are more political.12
Picketing is more restrictive during public sector strikes than it is in private sector strikes.
Striking public servants may not impede or restrict access to essential services. Therefore,
picketing in public sector strikes is constrained in a way that is different from private sector
strikes. This issue has played out most frequently in regulating picket lines at courthouses. The
rule of law in Canada requires unimpeded access to the courts. Therefore, obstructing indi-
viduals officially connected with the court and preventing access by the public to courts of law
is a form of criminal contempt. A courthouse picket line has exactly that effect: it impedes
court officers and members of the public from attending court. Therefore, picket lines at
courthouses are typically prohibited or, at the very least, extremely limited.13 For other gov-
ernment buildings, some level of delay is acceptable: it will depend on how urgently the es-
sential service must be performed.
C. Limits on Topics That Can Be Collectively Bargained

In the private sector, there are few limits to the topics on which a union and employer may
choose to bargain (see Chapter 33). While a limited number of bargaining proposals are illegal,
and some collective agreement provisions are mandated by statutes, the parties are otherwise
only constrained by their imagination when it comes to the topics of bargaining. Not so in the
public sector. In the public sector, several topics are excluded from collective bargaining.

The federal Public Sector Labour Relations Act, for example, prohibits bargaining on any issue
that is established by legislation.14 This restriction has the impact of preventing bargaining on
the following topics:
• Pensions: Pensions in the federal public service are created by statute; therefore, there is
no collective bargaining about the funding or benefits of pension plans in the federal
public service.
• Appointments (including seniority): The appointment process in the core public admin-
istration is set out in legislation and, therefore, may not be collectively bargained. Setting
out this process in legislation has the practical effect of removing any seniority-based
rules for filling vacant positions in the federal public service.
• Job classifications
• Assignment of duties
• Layoffs: While unions may negotiate the amount of severance a laid-off employee will
receive, the decision to lay off employees and the selection of which employees to lay off
are outside the scope of collective bargaining.
While legislation varies from jurisdiction to jurisdiction,15 bargaining in the public sector is
generally on a more limited set of topics than in the private sector.
D. Interest Arbitration

While interest arbitration is sometimes used in the private sector, as discussed in Chapter 34, it
is more widely used in the public sector. Public sector employees who do not have the right to
strike—such as police officers and firefighters—always have a bargaining dispute resolved by
way of interest arbitration. Other public sector unions sometimes “opt in” to interest arbitration,
either by statutory right or with the agreement of the employer. The rules for interest arbitration
may vary from jurisdiction to jurisdiction, and may even vary within jurisdictions, depending
on the employees involved. A complete description of the interest arbitration regime in Canada
would fill an entire book. This chapter aims to provide a basic overview of interest arbitration as
it relates to the public sector.
Interest arbitration, unlike grievance rights arbitration (see Chapter 36), usually (although
not always) occurs before a panel of three people. Two members of the panel are “nominees”—
individuals selected by the union and employer, respectively. These nominees cannot be directly
affiliated with the employer or the union (e.g., a union cannot select its lawyer as a nominee);
however, the nominees are expected to advocate their side’s interests.16 The third member of the
panel is truly neutral and ends up being the de facto decision maker in an interest arbitration
case. If the parties cannot agree on the neutral chair of the arbitration panel, then the appoint-
ment is made by a labour relations board or a minister, as long as the selection results in some-
one who is broadly acceptable by virtue of the person’s training and expertise.17 An interest
arbitrator must of course not be biased in favour of either party,18 and they must also have the
necessary qualifications to be an effective arbitrator (including, where necessary, the ability to
conduct the hearing in both official languages).19
There are two types of interest arbitration in Canada. The first, and predominant, type is
straightforward: the parties make submissions on each of their proposals, and the arbitration
panel is free to select one or the other proposal on each issue, or construct its own answer to the
issues raised. For example, if the union proposes a 3 percent wage increase and the employer
interest arbitrator: An individual or three-person expert arbitration board tasked with writing the terms of a collective
agreement when the union and employer are unable to reach agreement through voluntary collective bargaining.

proposes a 1 percent wage increase, the arbitration panel is free to decide upon a 2 percent wage
increase (or some other percentage between 1 and 3).
The second type of interest arbitration is called final offer selection, or “baseball,” arbitra-
tion.20 In final offer selection arbitration, both sides submit their complete final offer; the arbi-
tration panel then has to select one of the two final offers, without amendment. The theory is
that this approach forces the parties to compromise when putting in their final offers, making it
easier to reach an agreement once the parties have seen how close they are in their final offers.21
However, final offer selection arbitration becomes more difficult when a large number of issues
are involved. An arbitrator will have a hard time selecting a final offer when one side is mildly
aggressive on all issues while the other party has compromised on every issue except one where
it has been incredibly aggressive.
Each statute that establishes an interest arbitration regime lists a number of factors that the
interest arbitration panel must consider when rendering its decision. However, regardless of the
wording of the statute, interest arbitrators retain their discretion to make a fair and impartial
award. In doing so, interest arbitrators tend to follow five principles when making their decision,
as explained below and summarized in Box 38.3.

Principles Interest Arbitrators Apply in Deciding Collective Bargaining Disputes
1. Replication Principle: Arbitrators attempt to “repli- 4. Comparability Principle: Arbitrators attempt to maintain
cate” what parties would likely have negotiated if the comparable terms and conditions between compar-
“industrial warfare” (i.e., strikes and lockouts) had able public sector and private sector jobs insofar as a
governed. reasonable comparable exists.
2. Incrementalism Principle: Arbitrators are conservative 5. Ability to Pay Principle: Arbitrators consider the general
and tend to avoid sudden large changes to previous state of government finances and the economy, al-
collective agreements. though this principle is controversial and applied cau-
3. Necessity Principle: Arbitrators consider the need of tiously because in most cases governments have the
governments to be able to attract and retain quality “ability” to pay but instead are “unwilling” to pay be-
employees and therefore recognize working condi- cause they have different political and economic
tions must be competitive. priorities.
• The replication principle: Interest arbitrators intend to replicate an agreement that con-
ventional bargaining (with a strike or lockout) would have produced. Interest arbitrators
are not there to apply an abstract notion of social justice, but instead to replicate the result
of collective bargaining. In doing so, interest arbitrators look for objective factors that
predict the results of collective bargaining, including the terms of freely negotiated col-
lective agreements in the same industry; the terms of collective agreements in the same
community; the terms contained in the expired collective agreement; and the bargaining
history between the parties.
• The incrementalism principle: Interest arbitration is an inherently conservative exercise.
As a general rule, interest arbitrators are reluctant to award major breakthroughs—they
final offer selection: A form of interest arbitration in which the interest arbitrator is restricted to imposing either the employer’s
or the union’s proposed collective agreement in its entirety.
replication principle: The principle that since interest arbitration is a substitute for free collective bargaining, the interest
arbitrator should seek to replicate, to the extent possible, an agreement that the parties would have likely reached had they had
recourse to the economic sanctions of a strike or lockout.
incrementalism principle: The principle that interest arbitrators should not impose significant changes on the parties to a
collective agreement, and should instead reserve those big changes for freely negotiated agreements.

see major breakthroughs as reserved for negotiations. This does not mean that an arbi-
trator will never award a significant pay increase;22 however, for the most part, interest
arbitrators see themselves as a stop-gap measure pending the next round of bargaining.
• The necessity principle: Governments have to be able to attract and retain quality
employees. Interest arbitrators will assess proposals with a view to whether particular
terms are necessary to meet those goals.
• The comparability principle: Interest arbitrators seek to maintain comparable terms and
conditions—especially pay—between comparable jobs in the public and private sectors.
Interest arbitrators are also concerned about internal comparability—in other words,
treating similar public servants similarly. Where two bargaining units have been com-
pared with each other for a long period of time (e.g., where police officers and firefighters
have received comparable wage increases for decades) interest arbitrators will tend to
follow those comparable agreements.
• The ability to pay principle: Among interest arbitrators, considerable controversy exists
over whether arbitrators should consider the government’s “ability to pay” when making
an award. Interest arbitrators have, traditionally, been reluctant to consider “ability to
pay”—recognizing that a government rarely truly has an inability to pay, but instead has
an unwillingness to pay (or an unwillingness to tax).23 In response, some legislation
establishing interest arbitration contains provisions permitting or requiring interest
arbitrators to consider “ability to pay”; virtually all such legislation permits or requires
interest arbitrators to consider the general state of the economy and the government’s
fiscal position when making their awards. When assessing economic circumstances,
arbitrators consider what “a majority of fair-minded, well-informed taxpayers would
consider to be a fair and reasonable award.”24 Interest arbitrators also examine the evi-
dence carefully to ensure that there is a true inability to pay instead of just an unwilling-
ness to pay (or an unwillingness to cut service levels).
For example, on December 16, 2009, an interest arbitrator awarded an interim award
(instead of a final award) for firefighters in Windsor that did not approve a reduction to
a 42-hour workweek that would normally be justified on the basis of comparative an-
alysis.25 The interest arbitrator made that decision in light of the disproportionate impact
the 2008 – 2009 recession was having in Windsor. The firefighters eventually received
their 42-hour workweek effective December 31, 2014. By contrast, when the City of
Toronto argued that it had an inability to pay its firefighters in 2013 because of a short-
term budget deficit, the same interest arbitrator was unimpressed and made an award
based on the long-standing comparable agreement with police officers.26
Whether interest arbitration is a suitable process for resolving bargaining disputes is a matter
of ongoing debate. Some commentators are concerned about what industrial relations scholars
call the “corrosive and narcotic” effect on bargaining: corrosive in that it decreases the number
of collectively bargained settlements, and narcotic in the sense that the parties become addicted
to interest arbitration.27 Evidence of the corrosive effect (sometimes called the “chilling effect”)
and narcotic effect on interest arbitration is mixed.28 There is some evidence of it in certain sec-
tors, but less in others. Some public sector employers also complain that the interest arbitration
system leads to higher wage increases; this allegation is much more controversial, and there is
necessity principle: The principle that interest arbitrators should order the terms (e.g., wages and other benefits) necessary
to attract and retain employees for the employer.
comparability principle: The principle that interest arbitrators should maintain comparable terms and conditions (e.g., pay)
between comparable jobs in the public and private sectors.
ability to pay principle: The principle that where provided by statute, interest arbitrators may (or must) consider the govern-
ment’s ability to pay when deciding the terms of their award.

little evidence that interest arbitration leads to higher wage increases than negotiated
agreements.29
E. Bargaining Unit Composition

As Chapter 31 noted, a bargaining unit serves at least two functions: it is the basis for organiza-
tion and the basis for a long-term bargaining structure. Thus, labour relations boards must
balance two different policy considerations when determining the “appropriate bargaining
unit”: they must create a unit that is not so large or disparate as to make union organizing im-
possible, and they must ensure that the unit is not so small as to make collective bargaining
unfeasible. In the public sector, the second policy consideration usually outweighs the first. As
a general rule, public sector employers are “not merely tolerant of collective bargaining, but
rather anxious for it to get under way.”30 Therefore, bargaining units in the public sector tend to
be much larger than in the private sector.
Another reason for larger bargaining units in the public sector is that legislation often defines
the appropriate bargaining unit instead of simply leaving the labour relations board to deter-
mine whether a particular group of employees shares a community of interest. In Ontario, for
example, the Crown Employees Collective Bargaining Act31 designates four bargaining units:
• Correctional employees
• Engineering employees
• Lower-level managers (referred to as the “fourth bargaining unit”)
• A so-called “unified” bargaining unit with the remaining administrative, operational and
maintenance, health care, and technical employees
The corrections and unified bargaining units are represented by the same union—the Ontario
Public Service Employees Union (OPSEU)—while the other two bargaining units have different
unions.
The federal public service has a larger number of bargaining units than Ontario. Rather than
define bargaining units, the Federal Public Sector Labour Relations Act creates a presumption
that bargaining units will follow classification lines.32 This presumption means that, with the
exception of dockyard workers who have separate bargaining units for the east and west coast,
no regional or geographical-based bargaining units exist in the federal public service: all
employees of a particular classification are covered by the same collective agreement across
Canada.33 The federal government made a policy decision when collective bargaining was intro-
duced that employees performing the same work would be paid the same, regardless of where
they work. While there are a small number of regional pay differences,34 this policy has
remained in place to the present day.
IV. Implications of Public Servants’ Duty of Fidelity

As discussed in Chapter 9, every employee owes their employer a duty of fidelity. This duty has
a number of unique features in the federal public service. First, the duty of fidelity is owed to the
government, not to the political party in power at any given time. Public servants are therefore
required by statute to swear or affirm an oath of loyalty to the Crown before becoming a public
servant. For example, federal public servants are required to swear the following oath:
I, [name], swear (or solemnly affirm) that I will faithfully and honestly fulfil the duties that devolve
on me by reason of my employment in the public service of Canada and that I will not, without due
authority, disclose or make known any matter that comes to my knowledge by reason of such
employment.35

In the province of Ontario, public servants must give an oath of allegiance and loyalty to the
Queen.36 This duty of fidelity to the Crown (as opposed to a duty to any particular political
party) exists because of the public interest in an impartial public service. The Canadian tradition
of the public service emphasizes the characteristics of impartiality, neutrality, fairness, and
integrity—as opposed to a “spoils” system that is more prevalent in other countries (and was,
historically, used in Canada).
The duty of fidelity often conflicts with the right of public servants to criticize the govern-
ment. Public servants have the right to criticize the government, just as every citizen has a right
to do so. However, this right of public criticism must be balanced against the public servant’s
duty of fidelity to the Crown. This means that public servants must act with some restraint when
criticizing the government publicly. The degree of restraint depends on the position occupied
by the public servant, the visibility of the public servant, the nature of the criticism, and the
topics of the criticism. For example, a data-entry clerk has greater latitude to criticize the gov-
ernment than a deputy minister; a public servant also has greater latitude to criticize the
government about policies that jeopardize the life, health, or safety of the public as opposed to
other types of issues.
Linked to the concept of the duty of fidelity is the obligation of political neutrality. Public
servants have a constitutional right to participate in political activity; however, this right is lim-
ited by their obligation to perform—and be seen to perform—their duties in a politically neutral
manner. In most jurisdictions, the balance between these two obligations is set out in statute.
Federally, for example, public servants below the rank of deputy minister have the right to
engage in political activity as long as doing so “does not impair, or is not perceived as impairing,
the employee’s ability to perform his or her duties in a politically impartial manner.”37 This pro-
vision means that an employee, for example, cannot help a political party during working hours
or using work equipment. If a public servant wants to run for political office, they need to obtain
permission from the Public Service Commission. If the political office is federal, provincial, or
territorial, the public servant must take a leave of absence during the election period and may
be asked to take a leave of absence prior to the election period; if the public servant is running
for municipal office, a leave of absence is not mandatory but may be required, depending on the
nature of the election, the nature of the public servant’s duties, and the visibility of the public
servant. Finally, the Public Service Commission has the right to refuse to grant permission to a
public servant who wants to run for political office (see the decision in Box 38.4).

Public Servants Who Want to Run for Elected Office
Taman v. Canada (Attorney General) tions, particularly on files of a political nature. The Public
2017 FCA 1 Service Commission agreed and rejected Taman’s request. She
eventually appealed that decision to the Federal Court of
Key Facts: Emilie Taman was a federal prosecutor. She was Appeal.
responsible for the prosecution of regulatory offences, such as
immigration, fishery, and income tax offences. On November Issue: Would being a candidate for political office impair or be
21, 2014, Taman submitted a request to the Public Service perceived as impairing Taman’s ability to perform her duties
Commission for permission to seek the nomination of a polit- in a politically impartial manner?
ical party and, if successful, run as that party’s candidate in the
Decision: No. The Public Service Commission was particularly
2015 federal election. The director of public prosecutions op-
concerned about the high level of autonomy, discretion, and
posed this request on the grounds that a perceived allegiance
visibility of a prosecutor. The commission erred, however, by
to a political party could be perceived as interfering with Ta-
equating this autonomy, discretion, and visibility with the
man’s ability to independently perform her prosecutorial func-
impairment of Taman’s ability to perform her duties with pol-

itical impartiality. Taman obviously identified with a particular should be ignored, and if the attacks were in good faith, she
political party prior to seeking permission to be a candidate: would be excused from a particular file because of a conflict
the commission could not explain why, if her political options of interest. The court concluded that there was no indication
did not colour the exercise of her discretion before the elec- that Taman, following an unsuccessful attempt to obtain elect-
tion, they would do so after the election. The commission was ed office, would conduct herself in a politically partisan man-
also concerned about attacks on Taman based on her political ner or in a manner that would leave her open to allegations of
partisanship. The court of appeal discounted that possibility: political partisanship.
if the attacks were in bad faith and politically motivated they
Finally, special rules apply to whistle-blowers in the public service. Most jurisdictions have
legislation that provides a forum, person, or body to whom whistle-blowers can make their
disclosure; this legislation also protects whistle-blowers from reprisals for having disclosed
wrongdoing (or what they thought, in good faith, was wrongdoing).38 Sometimes, public ser-
vants have gone directly to the media or the public to disclose wrongdoing, either before or after
reporting the wrongdoing internally or to this whistle-blowing forum. Most of the time, public
whistle-blowing is prohibited: a public servant is expected to go “up the ladder” instead of dir-
ectly to the public. Public whistle-blowing is only permitted in the most serious cases, when
there is insufficient time to go “up the ladder” or to the whistle-blower protection forum and the
subject matter of the disclosure involves an imminent risk of danger to the life, health, and safety
of people or the environment.
V. Chapter Summary

In Vaughan v. Canada, Justice Binnie of the Supreme Court of Canada wrote:
The terms and conditions of employment of the federal government’s quarter of a million current
workers are set out in statutes, collective agreements, Treasury Board directives, regulations, minis-
terial orders, and other documents that consume bookshelves of loose-leaf binders. Human resources
personnel are recruited into the system, spend a career attempting to understand it and die out of it.39
This pronouncement, while somewhat demoralizing on its face, captures the public’s view of
the public service as rule-driven and fastidious in the application of those rules. However, these
rules—particularly when they depart from the normal approach to labour law in the private
sector—are there as a result of the unique qualities of the government as employer. The govern-
ment is accountable to citizens, not shareholders; public sector unions correspondingly advo-
cate to the public as much as to their employer. This fundamental fact means that the laws are
different in the public service.

1. What rationale justifies a distinct collective bargaining model for the Canadian public sec-
tor that differs from the primary model used in the private sector (about which we have
learned in Part IV)?
2. Describe three models for dealing with strikes in Canadian essential services.
3. Identify and describe the principles that guide interest arbitrators as they perform their
function of settling collective bargaining disputes involving essential services.
4. In what ways is the collective bargaining model used in the Canadian public service dis-
tinctive from the model used in the private sector?
5. Should public servants be allowed to run for elected office or engage in other forms of pol-
itical activity? Why or why not?
whistle-blower: An employee who discloses information about harmful or illegal conduct of their employer or co-workers.

APPLYING THE LAW

1. In 2011, the Ontario government enacted the TTC cluding the recent re-negotiation of the North Amer-
Labour Disputes Resolution Act, 2011, which prohibits ican Free Trade Agreement (NAFTA) (see Chapter 27).
employees of the Toronto Transit Commission from Ms. Smith is a passionate environmentalist. At a recent
striking, treating the provision of public transit in Can- public forum, she criticized the current government for
ada’s largest city as an essential service. Collective bar- not doing enough to push environmental protection
gaining disputes must be referred to binding interest in the re-negotiation of NAFTA. She stated that the
arbitration. In 2018, an interest arbitrator heard argu- government had “betrayed Canadians and the world”
ments from the parties about what the new collective by not pushing harder for environmental protection in
agreement should include and issued a decision im- NAFTA. Her comments were published on a popular
posing terms of a new collective agreement. Read the political blog.
decision (which is short) and can be found on the Can- Ms. Smith has received a letter from global affairs
LII website: Toronto Transit Commission v. Amalgamated stating that they are concerned about her statement and
Transit Union, Local 113, 2018 CanLII 99135 (Ont. LA). are considering disciplinary action. She is concerned
Explain which “principles” of interest arbitration (Box about being disciplined and would like to know what the
38.3) the arbitrator applies in his decision and what result possible result would be. She has also been approached
he comes to in applying those principles. to run as a candidate for the Green Party of Canada in an
2. Ms. Smith works for the federal government in the de- upcoming provincial election. Ms. Smith has asked for
partment of global affairs. She has been employed in an opinion about whether she can run as a candidate
various positions within the federal public service for and whether she can be disciplined for her comments
the past 19 years. Presently, she is employed as assist- criticizing the government. Advise Ms. Smith.
ant director, Trade Re-Negotiation Secretariat. Her
functions include supporting trade negotiations, in-

1. J. Finkelman & S. Goldenberg, Collective Bargaining in the 7. Public Service Alliance of Canada v. Parks Canada Agency,
Public Service: The Federal Experience in Canada (Mont- 2008 PSLRB 97 at para 180.
real, QC: Institute for Research on Public Policy, 1983) at 8. C.A.T.C.A. v. The Queen, [1982] 1SCR 696.
xxvii and 7.
9. Beacon Hill Lodge v. BCNU and HEU (1986), No. 2/86
2. Advisory Committee on Labour-Management Relations in (BCLRB), aff ’d Beacon Hill Lodge v. British Columbia, 1987
the Federal Public Service, Working Together in the Public CanLII 2742 (BCCA).
Interest: Second Report (Ottawa, ON: Treasury Board Sec-
10. Ontario (Management Board Secretariat), [1998] OLRD
retariat, 2001) at 14.
No. 3050.
3. Or, more accurately, “La Reine ne négocie pas avec ses
11. Grain Workers’ Union, Local 333 v. B.C. Terminal Elevator
sujets.”
Operaters’ Assn., 2009 FCA 201.
4. For further information about Crown corporations, see I.
12. British Columbia Teachers’ Federation v. British Columbia
Bernier & A. Lajoie, Regulations, Crown Corporations and
Public School Employers’ Assn., 2009 BCCA 39.
Administrative Tribunals (Ottawa, ON: Minister of Supply
and Services Canada, 1985). A number of books have been 13. B.C.G.E.U. v. British Columbia (Attorney General), [1988] 2
written about collective bargaining in the broader public SCR 214 at para 29. See also Ontario Public Service
sector. In education, for example, I recommend in par- Employees Union v. Ontario (Attorney General), 2002
ticular S. Slinn & A. Sweetman, Dynamic Negotiations: CanLII 41785 (Ont. CA).
Teacher Labour Relations in Canadian Elementary and Sec- 14. Federal Public Service Labour Relations Act, SC 2003, c. 22,
ondary Education (Montreal, QC: McGill-Queen’s Univer- s. 113.
sity Press, 2012). 15. For example, Ontario’s Crown Employees Collective Bar-
5. For example, Canada Labour Code, RSC 1985, c. L-2, gaining Act, 1993, SO 1993, c. 38 is much more permissive
s. 87.4. than the Federal Public Sector Labour Relations Act (supra
6. Toronto Transit Commission Labour Disputes Resolution note 14).
Act, 2011, SO 2011, c. 2.

16. Yorkton (City) v. Yorkton Professional Fire Fighters Associa- Sector Employment in a Time of Transition (Madison, WI:
tion, Local 1527, 2001 SKCA 128. Industrial Relations Research Association, 1996) 85-125.
17. C.U.P.E. v. Ontario (Minister of Labour), 2003 SCC 29. 29. See, for example, T. Kochan, D. Lipsky, M. Newhart, & A.
18. Canadian Union of Postal Workers v. Canada Post Corpora- Benson, “The Long-Haul Effects of Interest Arbitration:
tion, 2012 FC 975. The Case of New York State’s Taylor Law” (2010) 63:4
Indus & Lab Rel Rev 565.
19. Canadian Union of Postal Workers v. Canada Post Corpora-
tion, 2012 FC 110. 30. Insurance Corp of British Columbia and CUPE, Local 1695
(1974), 1 CLRBR 403 at 407.
20. Major League Baseball is the most famous employer to use
final offer arbitration. 31. Crown Employees Collective Bargaining Act, 1993, supra
note 15, s. 23. The bargaining units are more fully defined
21. See, for example, E. Black & J. Silver, “Contradictions and
in the OPSEU collective agreement: “Collective Agree-
Limitations of Final Offer Selection: The Manitoba Experi-
ments with Respect to Working Conditions, Employee
ence” (1990) 45 Indus Rel 146; and J. Rose, “Legal Chal-
Benefits and Salaries between the Ontario Public Service
lenges to Interest Arbitration: Evidence from Canada”
Employees Union and the Crown in Right of Ontario Rep-
(2015) 66:3 Lab LJ 177.
resented by Management Board of Cabinet, January 1,
22. One of the most famous examples is Association of Law 2015 to December 31, 2017,” online (pdf): <https://opseu.
Officers of the Crown v. Ontario (Management Board of org/sites/default/files/2015-2017_opseu_central_unified_
Cabinet), [2000] OLAA No. 790, where arbitrator Kaplan agreement_-_final.pdf>.
ordered a 30 percent wage increase for Ontario Crown
32. Federal Public Sector Labour Relations Act, supra note 14,
lawyers.
ss. 57, 70, 91. There is one exception to this practice: the
23. M. Teplitsky, “Ability to Pay and the Independence of Arbi- act designates a single national bargaining unit for all
tration: An Arbitrator’s Perspective” in W. Kaplan et al., RCMP regular members and reservists in s. 238.14.
eds, Labour Arbitration Yearbook (1998) (Toronto, ON:
33. Ibid.
Lancaster House, 1998) at 357.
34. For example, employees working in isolated communities
24. Niagara (Regional Municipality) Police Services Board and
receive a special isolated post allowance. Lawyers working
Niagara Police Association (1997), 78 LAC (4th) 42 at 58.
in Toronto also have a regional rate of pay.
25. Windsor (City) v. W.P.F.F.A. (2009), 100 CLAS 246
35. Public Service Employment Act, SC 2003, c. 22, ss. 12, 13,
(Burkett); and Re: Windsor (City) and W.P.F.F.A. (Renewal
54.
Collective Agreement) (2013), 117 CLAS 353.
36. Public Service of Ontario Act, 2006, SO 2006, c. 35, Sched.
26. Toronto (City) and I.A.F.F., Local 3888 (Renewal Collective
A, ss. 5-6; and Oaths and Affirmations, O. Reg. 373/07,
Agreement) (2013), 116 CLAS 117 (Burkett).
ss. 1-3.
27. J. Rose, “The Leech, the Tortoise and the Owl: The World
37. Public Service Employment Act, supra note 35, s. 12.
of Interest Arbitration in Ontario” in Labour Arbitration
Yearbook (1994 – 1995) (Toronto, ON: Lancaster House, 38. See, for example, the Public Servants Disclosure Protection
1995) at 393; and G. Adams, “The Ontario Experience Act, SC 2005, c. 46, which applies to federal public ser-
with Interest Arbitration: Problems in Detecting Policy” vants; the Public Interest Disclosure (Whistleblower Protec-
(1981) 36:1 Indus Rel 225. tion) Act, SA 2012, c. P-39.5, in Alberta; or The Public
Interest Disclosure (Whistleblower Protection) Act, CCSM
28. R. Hebdon, “Public Sector Dispute Resolution in Transi-
c. P217, in Manitoba.
tion” in D. Belman, M. Gunderson, & D. Hyatt, eds, Public
39. Vaughan v. Canada, 2005 SCC 11 at para 1.

Selected Cases: Part IV
Amalgamated Transit Union, Local 0591 v. Société de transport de l’Outaouais, 2017 CIRB 849 . . . . . . . . . . 666
Barrie Examiner, [1975] OLRB Rep. Oct. 745 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 539
Bhasin v. Hrynew, 2014 SCC 71 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 595, 596, 603
Berry v. Pulley, 2002 SCC 40 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 602, 644, 645, 657, 658
Cadillac Fairview Corp. Ltd. v. R.W.D.S.U., 1989 CanLII 4334 (Ont. CA) . . . . . . . . . . . . . . . 521, 531, 539, 577
Canada (Attorney General) v. Public Service Alliance of Canada, [1991] 1 SCR 614 . . . . . . . . . . . . . . . . . . . 664
Canada Safeway Limited v. United Food and Commercial Workers Union, Local No. 832,
2012 CanLII 97767 (Man. LA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 628
Canadian Pacific Railway Co. v. Zambri, [1962] SCR 609 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 576, 577, 602
Canadian Paperworkers Union v. International Wallcoverings, 1983 CanLII 764 (Ont. LRB) . . . 531, 539, 576
C.A.T.C.A. v. The Queen, [1982] 1 SCR 696 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 667, 675
Chatham-Kent Children’s Services v. OPSEU, Local 148 (2014), 251 LAC (4th) 313 . . . . . . . . . . . . . . . . . . . 593
Coca-Cola Bottling Ltd. v. U.F.C.W. (1994), 44 LAC (4th) 151 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 600
Communications, Energy and Paperworkers Union of Canada, Local 30 v. Irving Pulp & Paper, Ltd.,
2013 SCC 34 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 597, 604
Dick’s Lumber & Building Supplies Inc. v. United Steelworkers of America, Local No. 1-3567,
2006 CanLII 28067 (BCLRB) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 562, 576
Edith Cavell Private Hospital v. Hospital Employees’ Union, Local 180, Re (1982),
6 LAC (3d) 229 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 627, 629, 630, 640
Ford Motor Company v. United Automobile Workers Union, [1946] OLAA No. 1 . . . . . . . . . 487, 588, 602, 630
Gagnon et al. v. Foundation Maritime Ltd., [1961] SCR 435 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 577
International Woodworkers of America Local 2-69 v. Consolidated Bathurst Packaging Ltd.,
1983 CanLII 970 (Ont. LRB) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 548, 549, 555
Krug Furniture Co. v. Berlin Union of Amalgamated Woodworkers, [1903] OJ No. 202 (QL) . . . . . . . . . . . . 480
Langley City Foods Ltd. v. United Food and Commercial Workers International Union, Local No.
1518, 2006 CanLII 22075 (BCLRB) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 515
Lennox Industries (Canada) Limited v. United Steelworkers of America, Local 7235,
1999 CanLII 20394 (Ont. LA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 631, 640
Lumber and Sawmill Workers’ Union, Local 2537 v. KVP Co. Ltd., Re (1965), 16 LAC 73 . . . . . . . . . . 596, 603
Marv Jones Honda v. International Association of Machinists & Aerospace Workers District
Lodge 250, 2015 CanLII 5787 (BCLRB) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 528, 538
McGavin Toastmaster Ltd. v. Ainscough, [1976] 1 SCR 718 . . . . . . . . . . . . . . . . . . . . 474, 541, 554, 576, 586, 602
Millhaven Fibres Ltd. v. Atomic Workers Intl Union, Local 9-670, Re, [1967] OLAA No. 4,
18 LAC 324 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 627, 633, 640
Mwemera v. United Brotherhood of Carpenters and Joiners of America, Local Union No. 2010,
2016 CanLII 8866 (Alta. LRB) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 649, 650
Ormerod v. Unifor, Local Union No. 333-BC, 2016 CanLII 36389 (BCLRB) . . . . . . . . . . . . . . . . . . . . . . . . . . 651
OSSTF v. Muskoka Board of Education, [1996] OLRD No. 3369 (Ont. LRB), aff ’d [1998] OJ No.
1354 (QL) (Gen Div) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 656, 657
Parry Sound (District) Social Services Administration Board v. O.P.S.E.U., Local 324,
2003 SCC 42 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 618, 619, 621, 637, 638
Pointe-Claire (City) v. Quebec (Labour Court), [1997] 1 SCR 1015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 521
Polymer Corp. and Oil, Chemical and Atomic Workers’ International Union, Local 16-14 (1958),
10 LAC 31 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 603
Pop Shoppe (Toronto) Limited, [1976] OLRB Rep. June 299 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 539
Port Arthur Shipbuilding Co. v. Arthurs et al., [1969] SCR 85 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 639
677

Rayonier Canada (BC) Ltd. v. IWA, Local 1-217, [1975] 2 CLRBR 196 (BCLRB) . . . . . . . . . . . . . . . . . . . . . 659
Retail, Wholesale & Department Store Union v. T. Eaton Company Limited,
1985 CanLII 933 (Ont. LRB) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 551, 555
Rookes v. Barnard, [1964] AC 1129 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 474
Royal Oak Mines Inc. v. Canada (Labour Relations Board), [1996] 1 SCR 369 . . . . . . . . 547, 550, 551, 555, 556
R.W.D.S.U., Local 558 v. Pepsi-Cola Canada Beverages (West) Ltd., 2002 SCC 8 . . . . . . . . . . . . . . 569, 575, 577
Saskatchewan Federation of Labour v. Saskatchewan, 2015 SCC 4 . . . . . . . . . . . . . . . . . . . . . . 561, 574, 576, 578
Seaspan ULC v. International Longshore & Warehouse Union, Local 400,
2014 CanLII 83893 (CALA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 637
St. Anne Nackawic Pulp & Paper v. Canadian Paper Workers Union, Local 219,
[1986] 1 SCR 704 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 577, 638
Taman v. Canada (Attorney General), 2017 FCA 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 673, 674
Toronto Transit Commission v. Amalgamated Transit Union, 2004 CanLII 55086 (Ont. LA) . . . . . . . . . . . . 595
Unionized Employees of Tenaquip v. Teamsters, Local Union 419, 1997 CanLII 15586 (Ont. LRB) . . . 654, 660
United Food & Commercial Workers, Local 206 v. Lynn Management Ltd., [1999]
Ont. LRB Rep. Nov. 19 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 512, 513, 522
United Food and Commercial Workers International Union, Local 1000A v. Nike Canada Ltd.,
2006 CanLII 24724 (Ont. LRB) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 509
United Food and Commercial Workers Canada Union, Local No. 401 v. Widewaters Calgary Hotel
Management Company, 2018 CanLII 33689 (AB LRB) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 536, 538, 540
United Steelworkers 1-2693 v. Neenah Paper Company of Canada, 2006 CanLII 9888 (Ont. LRB) . . . . . . . 572
United Steelworkers of America v. Wal-Mart Canada, Inc., 1997 CanLII 15529
(Ont. LRB) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 534, 535, 536, 540
United Steelworkers of America, Local 12998 v. Liquid Carbonic Inc., 1996 CanLII 11787
(Ont. Gen Div) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 639
U.S.W.A. v. Russel Steel Ltd. (1966), 17 LAC 253 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 590, 591, 608
Vernon Professional Firefighters’ Association, I.A.F.F. Local 1517 v. Corporation of the
City of Vernon, 2019 CanLII 28158 (BCLA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 632
Weber v. Ontario Hydro, [1995] 2 SCR 929 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 617, 618, 619, 620, 638
Wm. Scott & Company Ltd. v. Canadian Food and Allied Workers Union, Local P-162 (1977),
1 CLRBR 1 (BCLRB) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 622, 623, 639
Woodstock (City) v. Woodstock Professional Firefighters’ Association,
2015 CanLII 20641 (Ont. LA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 597, 604

PART V
The Canadian Charter
of Rights and Freedoms
and Work
CHAPTER 39 The Canadian Charter of Rights and Freedoms and Work
Selected Cases: Part V


CHAP T ER 39
The Canadian Charter of Rights

and Freedoms and Work*
II. What or Whom Does the Charter Govern? 682
• Explain the importance of the Canadian Charter of Rights and Freedoms.
III. Understanding “Charter Challenges” 683
• Describe who and what the Charter governs. A. Step One: Has Government Infringed a Charter Right or
• Describe the two-step Charter challenge test known as the Oakes test. Freedom? 684
• Explain the difference between enumerated and analogous grounds in B. Step Two: If an Infringement Has Occurred, Is It Justified in
a Free and Democratic Society? 684
the Charter’s equality rights provision (s. 15).
IV. How the Charter Has Influenced the Law of Work in
• Describe how the Charter has influenced the development of the Canada 686
common law, regulatory standards, and collective bargaining regimes of A. The Charter and the Common Law Regime of Work
work law. Law 686
• Discuss the core differences between the scope of section 2(d) of the B. The Charter and the Regulatory Standards Regime 687
Charter as described by the Supreme Court of Canada in the “First Labour C. The Charter and the Collective Bargaining Regime 691
Trilogy” (1987) and the “Second Labour Trilogy” (2015). V. Chapter Summary 701
I. Introduction
April 17, 1982, was a momentous day in Canadian law. That was the day the Canadian Charter
of Rights and Freedoms (the Charter) came into force.1 In the hierarchy of government regula-
tion, the Charter is perched at the top. The Charter is part of the Constitution Act, 1982, and its
purpose is to regulate government action. The Charter imposes checks and balances on what
governments can and cannot do by guaranteeing Canadians a bundle of fundamental rights and
freedoms. Governments cannot impede the exercise of these rights and freedoms by Canadians,
unless they can establish pressing and substantial reasons for doing so. In short, every govern-
ment action, including every statute and regulation enacted, must be consistent with the Char-
ter; otherwise, it is unlawful. The task of enforcing the Charter—of ensuring that governments
do not overstep their authority and infringe upon Canadians’ fundamental rights and freedoms—
was assigned to the courts, which were empowered to strike down laws and other government
action that infringed the Charter.
* This chapter was co-authored by Benjamin Oliphant and David Doorey. Mr. Oliphant is a lawyer with
Gall Legge Grant & Munroe LLP in Vancouver and an adjunct professor in the Faculty of Law at the
University of British Columbia.
681

682 Part V The Canadian Charter of Rights and Freedoms and Work
Prime Minister Pierre Elliott Trudeau (left) and Queen Elizabeth II sign the Proclamation of the Constitution Act,
1982, which includes the Canadian Charter of Rights and Freedoms, on April 17, 1982.
Source: Library and Archives Canada/National Archives of Canada fonds.e002852801.
When the Charter was first enacted, there was much debate about its potential impact on the
law of work.2 Some commentators believed it would fundamentally transform labour policy,
ushering in a new legal world in which core labour rights such as the right to workplace equality
and the rights to collective bargaining and to strike would be guaranteed for all Canadian work-
ers. Others believed that in applying the Charter, the courts would continue their long-standing
pattern of protecting the interests of capital (employers) over workers and, therefore, the Char-
ter would make little difference for workers and, indeed, could make matters worse.3 Today,
nearly four decades into the Charter era, the results are mixed, and the jury remains out on the
effects of the Charter on work laws. Workers have enjoyed some Charter victories, but the uto-
pian dream of Charter “romantics” that the Charter would fundamentally reform the workplace
for the great benefit of Canadian workers remains doubtful.
This chapter introduces the history and structure of the Charter and provides a summary of
the key develops in regard to the Charter’s impacts on the law of work. We will examine all three
regimes of work law (common law, regulatory standards, and collective bargaining), with an
emphasis on the collective bargaining regime, which has attracted the most Charter litigation
and is presently in a state of regeneration owing to an unexpected and renewed interest in “free-
dom of association” by the Supreme Court of Canada in the 21st century. Some of this material
is challenging, particularly the part on freedom of association; even seasoned constitutional
lawyers sometimes struggle to make sense of the evolution of the courts’ application of the
Charter to work-related matters. We have attempted to break down the material so that it is
understandable even to those who have no background in the Charter. Here we go!
II. What or Whom Does the Charter Govern?

Let’s start at the beginning. The Charter came into force after much political debate and wran-
gling over its contents. What resulted was a compromise document, sparse in text, yet deceptively

Chapter 39 The Canadian Charter of Rights and Freedoms and Work 683
complex in its meaning and application. The first important point to understand about the
Charter is that it only applies to government action.4 Its purpose is to regulate the relationship
between governments and citizens, not the relationships between private citizens and private
companies. It is essential to understand this crucial distinction. To repeat, the Charter sets limits
on government action.
How do governments act? First, they enact and administer laws and regulations. And second,
they act in the capacity of the employer of their own employees. When a Canadian government
acts in either of these two capacities, it must not do so in a manner that is inconsistent with the
Charter. Most Charter cases are targeted at government legislation that is alleged to violate
the Charter. However, occasionally complaints arise that the government, acting as an employer,
has contravened Charter rights in the manner in which it has treated its employees.
The fact that the Charter applies directly to government employers but not private sector
employers can be confusing. It means that if my employer is the City of Toronto, the Province
of British Columbia, or the Government of Canada, then my employer and my employment
contract must comply with the Charter. So, if a Canadian government had a policy of paying
its male employees more than its female employees for the same jobs, that policy could be dir-
ectly challenged as a violation of section 15 of the Charter, which protects the right to equal
treatment on the basis of sex. However, if Walmart, General Motors, or Tim Hortons had such
a discriminatory policy, the Charter would not apply. Employees of those private sector
employers could challenge the policy by filing a complaint under a human rights (see Chapter
22), pay equity (see Chapter 18), or employment standards statute, but the Charter would not
help them.
Often it is obvious whether an employer is “the government,” but not always. Occasionally,
the courts have been asked to decide whether an employer is “the government” on the basis that
it receives significant government funding, for example, or is highly regulated by the govern-
ment. Consider colleges, for example. They are not “the government” in an obvious sense, but
because they receive a significant amount of public funding and are under significant control of
a provincial government, the Supreme Court has treated colleges as government actors for the
purposes of the Charter. Therefore, in the case of Lavigne v. Ontario Public Service Employees
Union, the Supreme Court ruled that the Charter applied directly to a collective agreement
between a union and a community college because the employer was “the government.”5 How-
ever, the courts have ruled that universities are not government actors because although univer-
sities also receive public funding, governments have far less direct control over universities than
they do colleges.6
III. Understanding “Charter Challenges”

Now that we know that the Charter regulates only government conduct, we can begin our ex-
ploration of the substance of the Charter. First, let’s examine how the Charter operates in prac-
tice. Governments must consider the Charter whenever they are proposing and drafting new
laws. Usually, a government that receives legal advice that a proposed law (a bill) will infringe
the Charter is expected to revise the bill to bring it into Charter compliance or withdraw the bill.
Once legislation is enacted into law, it can be challenged by anyone who believes the law violates
a right or freedom protected by the Charter. This type of legal proceeding is described as a
Charter challenge. The Supreme Court has created a two-step process to analyze Charter
challenges.
Charter challenge: A legal proceeding that alleges that government action contravenes the Canadian Charter of Rights and
Freedoms.

A. Step One: Has Government Infringed a Charter Right or Freedom?

The first step in the analysis is to decide whether government action contravened a Charter-
protected right or freedom. If it does not, then the Charter does not apply, the Charter challenge
is dismissed, and the government’s action is confirmed as lawful.
Sometimes it is obvious that the government has violated a Charter right or freedom. For
example, until 2006, the Ontario Human Rights Code prohibited discrimination on the basis of
“age,” but then defined “age” as between 18 and 64 years old. This definition meant that it was
perfectly legal for employers to discriminate against workers who were under 18 or over 64, but
discrimination in employment against people between the ages of 18 and 64 was illegal. Age was
defined in this way in order to permit mandatory retirement, a practice in which employees
are required to leave their jobs upon attaining a specific age. Whether you were protected from
discrimination depended entirely on your age, and therefore the definition of “age” clearly con-
travened the guarantee in section 15 of the Charter of freedom from age discrimination. The
Supreme Court confirmed this conclusion in the 1990 case of McKinney v. University of Guelph
(see Box 39.3), in which eight University of Guelph professors challenged their forced retire-
ment at age 65.7 In the McKinney case, the real dispute related to the second part of the Charter’s
two-step analysis, which is discussed in below.
Other times, it is not obvious whether government action has infringed a Charter-protected
right or freedom, so complex arguments take place at this first step of the analysis. For instance,
as we will discuss later in this chapter, the Supreme Court has recognized prohibited grounds of
discrimination under section 15 of the Charter that are not expressly listed in that section; these
grounds are referred to as analogous grounds. A landmark Charter challenge based on analo-
gous grounds is the 1995 case of Egan v. Canada. That case involved a Charter challenge against
legislation that denied Old Age Security spousal benefits to same-sex couples. In its decision,
the Supreme Court ruled that section 15 protects against discrimination on the basis of “sexual
orientation,” even though that ground is not listed in section 15.8 The case involved a compli-
cated set of arguments at the step-one stage.
B. Step Two: If an Infringement Has Occurred, Is It Justified in a Free

and Democratic Society?
If a court or tribunal rules that government action has interfered with a Charter right or free-
dom, then it moves to the second step of the analysis: the section 1 analysis. That step is
described in section 1 of the Charter, which reads as follows:
The Canadian Charter of Rights and Freedoms guarantees the rights and freedoms set out in it subject
only to such reasonable limits prescribed by law as can be demonstrably justified in a free and democratic
society. [Emphasis added]
Section 1 explains that sometimes it is justifiable for a government to violate a Charter right
or freedom. It requires a balancing of interests. In certain instances, to protect or pursue an im-
portant public interest, it may be necessary to impinge upon Charter rights and freedoms. Sec-
tion 1 provides the legal mechanism to enable courts and tribunals to engage in that complex
balancing exercise.
analogous grounds: Prohibited grounds of discrimination in equality legislation that are not enumerated (listed) in the
legislation, but which the courts have read into the legislation because of their similarity to the enumerated grounds that are
protected (e.g., sexual orientation, marital status, and citizenship).

The language in section 1 is vague. However, in one of the earliest cases after the Charter was
enacted, the Supreme Court developed a section 1 “test” to be applied whenever this balancing
of interests takes place. The test became known as the Oakes test because the case in which it
originated is called R v. Oakes.9 That case was not itself about work, but the Oakes test applies to
all Charter challenges that engage section 1. The Oakes test is a “proportionality test,” which
means that it guides judges in their assessment of whether the benefit to society of allowing a
Charter violation outweighs the harm to the individual of having their Charter right violated.
The components of the Oakes test are described in Box 39.1.

Analysis of Section 1 of the Charter: The Oakes Test
Section 1 of the Charter requires courts and tribunals to weigh First, the measures adopted must be carefully de-
the harm to individual Canadians of having a Charter right or signed to achieve the objective in question. They
freedom restricted by government action against the interests must not be arbitrary, unfair or based on irrational
of the broader Canadian society. If the greater good is served considerations. In short, they must be rationally con-
by permitting the government to violate a Charter right or nected to the objective [the “rational connection” test].
freedom, then section 1 permits a court or tribunal to allow Second, the means, even if rationally connected to
that violation. In the 1986 decision in R v. Oakes, the Supreme the objective in this first sense, should impair “as little
Court developed a test for applying section 1 to a case of as possible” the right or freedom in question [the
Charter infringement. That test became known as the Oakes “minimal impairment” test] … Third, there must be
test. The Oakes test has two parts, each of which the govern- a proportionality between the effects of the meas-
ment must prove. ures which are responsible for limiting the Charter
right or freedom, and the objective which has been
Part One: The Pressing and Substantial Concern Test identified as of “sufficient importance” [the “balance
Part one requires that the objective of, or reason for, the limit- of harm” test]. [Emphasis added]
ation on the Charter right must relate to “a pressing and sub-
stantial concern.” This means, essentially, that the government In order to justify a violation of a Charter right or freedom,
must persuade the court or tribunal that its actions, which were a government must satisfy all three components of the pro-
found to impinge on Charter rights or freedoms, were taken to portionality test: (1) rational connection, (2) minimal impair-
address a serious public concern. Usually, the government ment, and (3) balance of harm or “proportionality.” If the
passes part one of the Oakes test without much difficulty, but government fails to prove any of these elements, the govern-
not always, as we will see when we look at the case of Vriend ment’s actions will be ruled unconstitutional. When a govern-
v. Alberta later in the chapter. ment satisfies the Oakes test, we say that the Charter violation
was “saved by section 1.”
Part Two: The Proportionality Test In the case of a statute that violates the Charter, the remedy
If the court or tribunal accepts that the purpose of the govern- can include striking down the entire statute or just the part of
ment action is to address a pressing and substantial concern, the statute that violated the Charter. Sometimes the courts
then the court will move on to part two of the Oakes test, which have provided the government with a period of time before
is known as the “proportionality test.” Most Charter challenges the law becomes invalid, during which the government can
are won or lost based on the outcome of the proportionality develop and enact a new, replacement law that is Charter
test. The Supreme Court described the proportionality test in compliant.
the Oakes decision as follows:
Oakes test: The test applied by courts and tribunals when interpreting section 1 of the Canadian Charter of Rights and Freedoms.
The test requires courts and tribunals to balance the interests of individuals in having their Charter rights and freedoms protected
against any broader social benefits that would result from allowing a restriction of a Charter right or freedom. Named after the
case R v. Oakes, the test was formulated by the Supreme Court of Canada.

In dozens of court cases in which a Charter right was infringed by the government, the gov-
ernment’s actions were “saved by section 1.” Some of those cases have related to workplace law.
The McKinney v. University of Guelph decision discussed in Box 39.3 is one example.
IV. How the Charter Has Influenced the Law of Work in Canada
Now that we have a basic idea of how the Charter works, we need to look more carefully at what
rights and freedoms it protects. In addition to section 1, the two sections of the Charter that are
most important to the law of work are section 2 (fundamental freedoms), especially “freedom
of thought, belief, opinion and expression” and “freedom of association,” and section 15 (equal-
ity rights). Section 6 (mobility rights) is also important, as it grants Canadians the right to work
in any province. These sections are reproduced in Box 39.2.

The Sections of the Charter That Are Most Important to the Law of Work
Guarantee of Rights and Freedoms (a) to move to and take up residence in any
1. The Canadian Charter of Rights and Freedoms province; and
guarantees the rights and freedoms set out in it (b) to pursue the gaining of a livelihood in any
subject only to such reasonable limits prescribed by province.
law as can be demonstrably justified in a free and
democratic society. Equality Rights
15(1) Every individual is equal before and under
Fundamental Freedoms the law and has the right to the equal protection and
2. Everyone has the following fundamental equal benefit of the law without discrimination and,
freedoms: in particular, without discrimination based on race,
(a) freedom of conscience and religion; national or ethnic origin, colour, religion, sex, age or
(b) freedom of thought, belief, opinion and mental or physical disability.
expression, including freedom of the press and (2) Subsection (1) does not preclude any law,
other media of communication; program or activity that has as its object the amelio-
(c) freedom of peaceful assembly; and ration of conditions of disadvantaged individuals or
(d) freedom of association. groups including those that are disadvantaged be-
cause of race, national or ethnic origin, colour, reli-
Mobility Rights gion, sex, age or mental or physical disability.
6(1) Every citizen of Canada has the right to enter,
remain in and leave Canada.
(2) Every citizen of Canada and every person who
has the status of a permanent resident of Canada has
the right
In the remainder of the chapter, we will explore how these Charter provisions have influ-
enced the development and substance of the laws of work in Canada since 1982.
A. The Charter and the Common Law Regime of Work Law
We can deal with the Charter’s impact on the common law regime relatively quickly.10 First,
recall that the Charter only regulates government action, not the actions of private citizens and
organizations. Therefore, insofar as a lawsuit is between two private (i.e., not government)
actors, the Charter does not directly apply. As a result, the Charter has played a limited role in

the development of the common law of employment. The Supreme Court decided in 1986 that,
even though the Charter does not apply directly to judges deciding contract and tort disputes
between private actors, common law judges should nevertheless be guided by “Charter values”
as they develop and apply common law rules.11 In this way, the Charter can indirectly influence
the development of the common law.
Probably the clearest example of the “Charter values” approach is the 2002 case of RWDSU,
Local 558 v. Pepsi-Cola Canada Beverages (West) Ltd., where the Supreme Court ruled that tort
law should develop in a manner consistent with “Charter values” and overruled a long-held
common law rule that placed heavy restrictions on the right of expression of workers involved
in a labour dispute.12 The case involved striking Pepsi employees who were distributing litera-
ture at retail stores that sold Pepsi products asking shoppers to support them by boycotting Pepsi
products during the strike.
Peaceful secondary picketing like this had been treated as a tort in the Canadian common
law since the pre-Charter 1963 decision of the Ontario Court of Appeal in Hersees of Woodstock
Ltd. v. Goldstein et al.13 However, in the Pepsi-Cola decision, the Supreme Court ruled that an
absolute ban on peaceful picketing and leafleting by workers was inconsistent with “Charter
values” since “picketing … always involves expressive action” and “it engages one of the highest
constitutional values: freedom of expression.”14 The Supreme Court introduced a new rule, which
essentially made all forms of information leafleting lawful under the common law, provided that
it was not done in a manner that was unlawful, such as by taking place on private property (illegal
trespass) or involving the commission of a crime or tort (such as assault, battery, or nuisance).
We noted in Chapter 34 that although labour picketing is an activity we associate with the col-
lective bargaining regime, the “law of picketing” (except in British Columbia) is mostly about tort
law. The Pepsi-Cola decision expanded the common law right to leaflet during a lawful work
stoppage by relying on “Charter values” and the importance of freedom of expression.
B. The Charter and the Regulatory Standards Regime

While the Charter was never intended to have a substantial impact on the common law regime,
it was expected to influence the development of the regulatory standards regime. The Charter’s
section 15 equality rights provision has attracted the most judicial attention. That section states
that “[e]very individual is equal before and under the law and has the right to the equal protec-
tion and equal benefit of the law without discrimination.” It then lists various enumerated
grounds: “race, national or ethnic origin, colour, religion, sex, age or mental or physical
disability.”
Not every legislative distinction violates section 15. There are two important provisos. First,
the distinction must negatively impact individuals in ways that undermine their human dignity
by, for instance, perpetuating negative stereotypes, prejudices, and historical disadvantages.15
Second, the distinction must be based on one of the “enumerated grounds” listed expressly in
section 15 or on an “analogous” ground. Analogous grounds have been added to the enumerated
list by courts over time on the basis that they reflect a personal characteristic that is unchange-
able (immutable) or involve a characteristic that a person ought not to be expected to change to
achieve equality, and people who share the characteristic have been subjected to historical dis-
advantage, stereotypes, and prejudice. To date, the Supreme Court has added “sexual
secondary picketing: Picketing in a labour dispute that takes place at a location other than the workplace where the workers
engaged in the dispute are employed.
enumerated grounds: The personal characteristics that are expressly listed in section 15(1) of the Canadian Charter of Rights
and Freedoms, namely race, national or ethnic origin, colour, religion, sex, age, or mental or physical disability.

orientation,”16 “marital status,”17 and “citizenship”18 as analogous grounds under section 15. The
Supreme Court has rejected the argument, made in several cases involving exclusions of vulner-
able workers from protective employment legislation, that “occupational status” or “vulnerable
workers” should be recognized as a new analogous Charter ground. The court has ruled that
section 15 does not apply to a distinction based on a person’s choice of job.19
The most effective way to demonstrate the influence of the Charter on the regulatory stan-
dards regime is to look at important work-related Charter decisions. The case summarized in
Box 39.3 provides an example of an early Charter challenge in which a violation of section 15
equality rights was “saved by section 1.”

Mandatory Retirement and Age Discrimination “Saved by Section 1”
McKinney v. University of Guelph widespread practice of mandatory retirement and to
[1990] 3 SCR 229 address the government’s concern that abolishing
mandatory retirement would have serious negative
Key Facts: McKinney was forced to retire at age 65 pursuant ramifications for Ontario’s labour market and the oper-
to the University of Guelph’s mandatory retirement policy. He ation of pension plans.
launched a Charter challenge against the university’s policy • The proportionality test:
and the Ontario Human Rights Code, which protected against 1. Rational connection test: The “age” definition maintains
age discrimination, but only for persons aged 18 to 64. McKin- stability and predictability in pension arrangements
ney asserted that both the policy and the code violated section and permits mandatory retirement.
15 of the Charter by discriminating against him on the basis 2. Minimal impairment test: The issue of whether to per-
of his age. The Supreme Court ruled that the Charter did not mit mandatory retirement is complex, with broad so-
apply to the university’s mandatory retirement policy because cial and economic consequences. Governments should
the university was not “the government.” However, the Charter be given latitude in addressing complex problems. The
clearly did apply to the Human Rights Code. government had a reasonable basis for concluding
Issue: Does the definition of age (18 to 64) in human rights that the age definition impaired the rights of older
legislation violate the protection against age discrimination in workers as little as possible.
section 15 of the Charter? If so, is that violation saved by sec- 3. Balance of harm test: The aim of prohibiting age dis-
tion 1 of the Charter? crimination was to protect those workers who are
most vulnerable (18 to 64 year olds). Workers 65 and
Decision: Yes. The code’s definition of “age” makes a distinction older can access public and private pensions. Govern-
based solely on the enumerated ground of age, and this dis- ments should be given leeway in making these tough
tinction imposes a burden on those 65 and older by taking policy decisions.
away a benefit available to those not in the class of workers
who are aged 18 to 64. Since the government satisfied all parts of the Oakes test,
However, the violation of section 15 is “saved by section 1.” the definition of age in the Human Rights Code was permitted
The Supreme Court applied the Oakes test as follows: to remain and McKinney lost his Charter challenge.
• The pressing and substantial concern test: The objective

of the legal rule was to permit the continuance of the
The discriminatory definition of age (18 to 64) in the Ontario Human Rights Code survived
the Charter challenge in McKinney. As noted in Chapter 22, Canadian governments have more
recently abolished the practice of mandatory retirement in most cases.20 In Vriend v. Alberta,
discussed in Box 39.4, the Alberta government failed in its attempt to defend its refusal to pro-
tect gay and lesbian workers from discrimination in their employment. As you read the sum-
mary of the Vriend decision, pay close attention to the government action that is found to violate
the Charter, keeping in mind that it was Vriend’s private sector employer who fired him and not
the government.


Charter Requires Governments to Prohibit Discrimination in Employment on the Basis of
Sexual Orientation
Vriend v. Alberta the basis of sexual orientation amounted to a distinction that
[1998] 1 SCR 493 denied equal protection to gay and lesbian Canadians. The
Supreme Court had already ruled in the 1995 case of Egan v.
Key Facts: Vriend was employed by an Alberta college until Canada that “sexual orientation” was an analogous ground to
the employer learned that he was gay, at which point Vriend those expressly included in section 15. Therefore, the govern-
was fired on the basis that being gay was inconsistent with the ment’s omission of sexual orientation from its human rights
college’s policies. Vriend attempted to file a complaint under legislation was an omission that created a distinction contrary
the province’s Individual’s Rights Protection Act, but he could to section 15 of the Charter.
not because, unlike most provinces, Alberta did not prohibit Section 1 did not save the violation of section 15. The omis-
discrimination in employment on the basis of “sexual orienta- sion of the analogous ground of sexual orientation from Al-
tion.” Vriend then filed a Charter challenge asserting that the berta’s human rights legislation failed every element of the
omission of sexual orientation from human rights legislation Oakes test: it did not address a pressing and substantial con-
violated his section 15 Charter right to equality. cern; it was not rationally connected to the objective of pro-
Issue: Does the omission of “sexual orientation” from the list tecting Albertans from discrimination (in fact, the omission
of prohibited grounds in human rights legislation violate sec- was “antithetical” to that objective); it did not impair the rights
tion 15 of the Charter? of gay and lesbian individuals as little as possible; and the
harm to gay and lesbian individuals from the exclusion far
Decision: Yes. First, government action can take the form of a outweighed whatever benefit the omission was intended to
positive action or an omission. An underinclusive protective achieve. To remedy the Charter violation, the Supreme Court
statute can violate the Charter. Second, the deliberate decision ordered that “sexual orientation” was to be immediately “read
of the Alberta government to not prohibit discrimination on into” the Alberta Individual’s Rights Protection Act.
The Vriend decision forced Alberta to protect workers from discrimination in employment
based on sexual orientation against the wishes of the province’s elected government.21 The deci-
sion provoked a heated debate within Alberta about how the government should respond, as
discussed in Box 39.5.

The Law of Work Framework: The Vriend Decision and Tensions Between External Subsystems
We can map the tensions that led “sexual orientation” to be Within the political subsystem of Alberta in the 1990s, the
added to the Alberta Individual’s Rights Protection Act by refer- Progressive Conservative government was strongly resistant to
ring back to the law of work framework presented in Chapter legislating protections against labour market discrimination for
2. By the time Vriend v. Alberta reached the Supreme Court in gay and lesbian workers. The extent to which these political
1997, most provinces—Quebec (1977), Ontario (1986), Mani- values reflected the attitudes of Alberta’s citizens (i.e., the social,
toba (1987), Nova Scotia (1991), British Columbia (1992), New cultural, and religious subsystem) rather than just its elected
Brunswick (1992), and Saskatchewan (1993)—and the federal politicians is a question that interests sociologists and political
government (1996) had already added “sexual orientation” to scientists. Certainly, conservative religious organizations in
the grounds of prohibited discrimination in their human rights Alberta were resistant to advancing legislative protections to
legislation. However, the notion of using law to protect gay and gay and lesbian Albertans. The political subsystem and the social,
lesbian individuals from employment discrimination remained cultural, and religious subsystem interacted in a manner that
unpopular in Alberta, at least among the elected politicians produced resistance to recognizing sexual orientation as a
tasked with making laws as well as many constituents in the protected ground. This relationship is depicted in the figure
government’s political base.* below by the black arrow lines (1).


Employment Protection Regulation
OUTPUTS
Alberta’s human rights legislation omits “sexual orientation”
from the list of protected grounds of employment
discrimination in contrast to most other Canadian jurisdictions.
2 1
The Supreme Court of Canada orders that “sexual orientation”
be added to the Alberta Individual’s Rights Protection Act
(Vriend v. Alberta).

The omission of “sexual orientation”
from Alberta’s human rights legislation
provokes a response within the broader 3
legal subsystem in the form of
a Charter challenge.
BROADER LEGAL POLITICAL SOCIAL, CULTURAL, AND

SUBSYSTEM SUBSYSTEM RELIGIOUS SUBSYSTEM
The Charter guarantees Alberta politicians reject • Strong religious lobby
“equality” on the basis of sexual orientation as a resisted recognition of
sexual orientation. protected ground. sexual orientation.
• Social conservatism is
stronger in Alberta than
it is elsewhere in Canada.
Ralph Klein, who was Alberta’s premier at the time Vriend izations, and some politicians were so angered by the decision
was decided, explained the government’s opposition to legis- that they called on the government to exercise the rarely used
lating protections for gay and lesbian individuals by noting section 33 Charter provision known as the “notwithstanding
that most Albertans, whom he described as “severely normal,” clause.”‡ Section 33 permits a government to override Charter
were opposed to the move.† rights for renewable five-year periods. In the end, then Premier
The Alberta legislature debated whether to include sexual Ralph Klein and the Alberta government he led elected not to
orientation as a protected ground in its human rights legisla- use the notwithstanding clause. However, in a show of symbolic
tion in the 1980s and decided against it. The path of this initial defiance, the government also did not formally revise the Indi-
decision is depicted by the black arrow lines in the figure. The vidual’s Rights Protection Act to expressly include sexual orienta-
absence of sexual orientation as a protected ground provoked tion until 2010, some 12 years after Vriend was decided.
Vriend’s decision to launch a Charter challenge (in the figure, The story of how sexual orientation came to be included
see the blue external feedback loop arrow line [2]), which put as a protected ground in Alberta’s human rights legislation
the political subsystem and the social, cultural, and religious requires an understanding of the broader social and political
subsystem on a collision course with the broader legal subsys- context and the tensions that sometimes result when the dom-
tem, which includes the Charter. The result of this clash was inant political, cultural, or religious orthodoxy collides with the
the decision of the Supreme Court to read in sexual orientation Charter’s fundamental rights and freedoms.
as a prohibited ground of discrimination in Alberta’s human
rights legislation (see the red arrow line [3]). This is an example * G. Filax, Queer Youth in the Province of the “Severely Normal” (Vancouver,
of how developments in the broader legal subsystem (consti- BC: University of British Columbia Press, 2006).
tutional law) can directly impact outputs within the work law † See T. Macklem, “Vriend v. Alberta: Making the Private Public” (1999) 44
subsystem. McGill LJ 197.
The Vriend decision ended the legal debate over whether ‡ B. Cossman, “Canadian Same Sex Relationship Recognition Struggles
Alberta should prohibit discrimination on the basis of sexual and the Contradictory Nature of Legal Victories” (2000) 48 Clev St L Rev
49 at 51.
orientation, but not the political debate. Many citizens, organ-

In a 2018 decision, the Supreme Court ruled that provisions in Quebec’s Pay Equity Act pro-
hibited the ordering of back wages to compensate women who had suffered pay discrimination
violated section 15 Charter equality rights and were not saved by section 1. The law effectively
permitted employers to pay women less than men for jobs of equal value until they were caught
and then prevented retroactive wage orders to make the women whole.22
C. The Charter and the Collective Bargaining Regime

The Charter’s greatest impact on the law of work has been in relation to the collective bargaining
regime. Freedom of expression found in section 2(b) of the Charter and especially freedom of
association (section 2(d)) have influenced the development of Canadian collective bargaining
law. Let’s consider the impact of each in turn.
1. Freedom of Expression (Section 2(b))

The Supreme Court has interpreted freedom of expression very broadly.23 In essence, if an act
conveys or attempts to convey meaning in a non-violent manner, it has usually been found to
fall within the scope of protected expression in section 2(b) of the Charter. As a result of the
broad definition of protected expression, most legal disputes involving freedom of expression
take place at step two of the Charter analysis, under section 1. The question becomes whether a
government restriction on freedom of expression is “demonstrably justified in a free and demo-
cratic society.” For example, employers have occasionally challenged labour legislation restrict-
ing their right to speech during union organizing campaigns. Although statutory restrictions on
employer speech violate employers’ section 2(d) freedom of speech, those restrictions have been
found to be justified under section 1 as necessary to protect vulnerable workers from coercion
at work during organizing campaigns.24
An important line of cases involving freedom of expression in the collective bargaining
regime relates to the rights of workers to engage in picketing against their employers. In an early
Charter case, RWDSU v. Dolphin Delivery Ltd. (1986), the Supreme Court ruled that peaceful
labour picketing is a protected “expression” under section 2(b) of the Charter because it conveys
meaning.25 However, the question remained: When, and under what circumstances, could pick-
eting be restricted by the government? In undertaking this analysis, the courts considered the
fact that picketing conveys meaning beyond the actual words stated or written on a placard. That
is, picketing also has a signalling effect: it can provoke “an automatic reflex response from work-
ers, suppliers, and consumers,” which the Supreme Court felt “may discourage some people
from making rational choices based on persuasive discourse.”26 In other words, when some
people see a picket line, they “hear” Don’t you dare cross this line.
In some cases, the courts expressed concern over this “signalling effect,” suggesting that it
could constitute coercion rather than expression intended to persuade. In the 1999 case of
U.F.C.W., Local 1518 v. KMart Canada Ltd., the Supreme Court said the following about the
signalling effect associated with labour picketing:
The decision for people, whether employees, suppliers or consumers, not to cross the picket line may
be based on its coercive effect rather than the persuasive force of the picketers. As the Board noted,
“picketing is both a signal and the exercise of freedom of expression.” It is the “signal” component of
conventional picketing which attracts the need for regulation and restriction in some
circumstances.27
signalling effect: A phrase used by courts to describe the psychological, perhaps unspoken, message conveyed to a person
confronted by labour picketing that the picketers desire that person to not cross the picket line.

In that case, the Supreme Court ruled that a statutory definition restricting picketing violated
freedom of expression of the picketers insofar as it went beyond restricting the signalling effect
of picketing and prohibited mere peaceful informational leafletting as well. However, in the
Charter challenge described in Box 39.6, the Supreme Court defended the importance of picket-
line activities that seek “to dissuade people from crossing the picket line” other than through
rational persuasion, such as informing those crossing a picket line that videos of them might be
posted online.28 In so doing, the Supreme Court signalled broader constitutional protection for
picket-line tactics of importance to unions in the course of lawful strikes.

Is Filming Employees Crossing a Picket Line a Protected Freedom of Expression?
Alberta (Information and Privacy Commissioner) picket line was a constitutionally protected expression, both
v. United Food and Commercial Workers, Local 401 with respect to the signalling effect (i.e., to dissuade individ-
2013 SCC 62 uals from crossing the picket line) and to the subsequent use
of the videos collected for expressive purposes. Based on the
Key Facts: The Alberta Personal Information Protection Act Oakes test, the Supreme Court ruled that while PIPA embodied
(PIPA) prohibits the collection, use, and distribution of “per- a pressing and substantial objective by protecting important
sonal information” about an individual without that person’s interests that are “intimately connected to … individual auton-
consent. In the context of lawful picketing, members of the omy, dignity and privacy,” the Alberta legislation was signifi-
United Food and Commercial Workers Union filmed the picket cantly overbroad, as it contained no mechanism to
line and used the images of identifiable persons crossing the accommodate the expressive activities of unions engaged in
picket line for promotional and training material. The Privacy strike action. In finding that the restrictions imposed
Commissioner of Alberta found that notwithstanding the im- by PIPA could not be justified under section 1, the court em-
pact on freedom of expression, the union had breached PIPA phasized the significance of freedom of expression in the
by collecting and distributing images of identifiable individ- context of labour disputes, given the relatively limited privacy
uals without their consent. interests engaged in this context (i.e., the filming occurred in
Issue: Do statutory restrictions on the use by organizations of public and did not reveal intimate details of the individuals
photos and videos without a person’s consent violate the filmed). Thus, although recognizing that some limitations on
freedom of expression of unions seeking to use such photos picket-line activity may be justifiable in furtherance of individ-
during a lawful labour dispute? ual privacy rights, PIPA did not achieve a reasonable or pro-
portionate balance, and therefore the restrictions in PIPA were
Decision: Yes, and this violation was not “saved” by section 1 not justified under section 1 of the Charter.
of the Charter. The Supreme Court found that filming the
We noted earlier in the chapter, when we looked at the Charter’s impact on the common law
regime, how the Supreme Court ruled in a case called Pepsi-Cola (2002) that a common law rule
that most “secondary picketing” during a lawful work stoppage was unlawful was inconsistent
with the “Charter value” of an expansive freedom of expression. The Supreme Court in that case
overturned that common law rule and replaced it with a more expansive right to picket provided
the picketing was done in a lawful manner—that is, was not criminal or tortious.
The Pepsi-Cola decision does not mean that governments cannot legislate limits on union
expression, on the picket line or elsewhere. Legislation that restricts peaceful picketing will now
likely violate section 2(b) of the Charter, as will legislation that substantially interferes with in-
cidental (but important) elements of picket-line expression (see Box 39.6). However, some lim-
itations on the right to expression through picketing will still likely be upheld, or “saved,” under
section 1. For example, in the 1988 case of B.C.G.E.U. v. British Columbia (Attorney General),
the Supreme Court ruled that a restriction on picketing in front of courthouses violated section
2(b) but was saved by section 1, because the need to ensure access to justice was pressing and

substantial and justified a restriction on expression.29 Overall, however, it is fair to say that there
has been a recent movement by the Supreme Court toward recognizing broader expressive
rights for unions and workers, particularly in the context of otherwise lawful picketing and
strike action.
2. Freedom of Association (Section 2(d))

Section 2(d) of the Charter says simply that everyone has “freedom of association.” What mean-
ing to attribute to those three words has proven to be a mystifying task. After more than 30 years
of section 2(d) litigation, the courts are still sorting out what precisely this freedom encom-
passes. As we will see, the Supreme Court’s meandering and sometimes contradictory decisions
in developing the scope of freedom of association have made this area of the law of work among
the most complex. Table 39.1 summarizes key Supreme Court decisions on section 2(d). We can
divide the development of the meaning of freedom of association under the Charter into three
periods: the early years, which includes the “First Labour Trilogy” (1987); the middle period, in
which the court began loosening restrictions imposed by the First Trilogy; and the modern era,
embodied by the judgments in the “Second Labour Trilogy” of 2015.
TABLE 39.1 Key Supreme Court of Canada Cases on Freedom of Association

1987: Three Supreme Court of Canada cases decided that the Charter’s “freedom of
“First Labour Trilogy” association” provision (section 2(d)) protects a right to form and join employee
associations and to exercise with others the rights and freedoms that individuals enjoy.
The Supreme Court also decided that freedom of association does not protect a right to
strike.
The three cases in the First Labour Trilogy were Reference Re Public Service Employee
Relations Act (Alta.); PSAC v. Canada; and RWDSU v. Saskatchewan.
1990 Professional Institute of the Public Service of Canada v. Northwest Territories (Commissioner):
Applying the same reasoning as in the First Labour Trilogy, the Supreme Court ruled that
freedom of association does not protect a right to collective bargaining.
2001 Dunmore v. Ontario (Attorney General): The exclusion of farm workers from the Ontario
Labour Relations Act, 1995 violated the freedom of association of farm workers. Section
2(d) protects the ability to engage in certain collective activities, such as making
“collective representations” to an employer. Because farm workers are excluded from the
protections provided in the collective bargaining statute, they have been unable to
engage in these activities. If a government enacts protective legislation, such as
collective bargaining legislation, but then excludes some workers from its protections, it
violates section 2(d) if the exclusion “substantially interferes” with the ability of the
excluded workers to exercise their freedom to associate.
2007 Health Services and Support—Facilities Subsector Bargaining Assn v. British Columbia (“BC
Health Services”): Freedom of association protects a right to collective bargaining after
all, and the government violated section 2(d) by passing legislation that negated terms
of previous collective agreements and imposed other terms without consulting or
bargaining with the affected workers. That violation was not saved by section 1 of the
Charter. The right to collective bargaining includes an obligation on employers to
consider collective representations from employee associations in good faith and to
engage in “a meaningful dialogue” with the association about those representations.
2011 Ontario (Attorney General) v. Fraser: After Dunmore, the Ontario government enacted the
Agricultural Employees Protection Act (AEPA), applicable only to farm workers. The AEPA
grants farm workers protection from reprisals for forming or joining employee
associations and requires employers to listen to representations on behalf of employees
presented through an association. However, it does not provide a right to collectively

bargain in good faith, a right to strike, or other key protective elements provided in the
Ontario Labour Relations Act, 1995. In Fraser, the Supreme Court ruled that the AEPA does
not violate section 2(d) since it protects a right to associate and requires employers to
listen to and consider “in good faith” collective representations made by employee
associations. That satisfied the requirements established in Dunmore and BC Health
Services.
2015: Mounted Police Association of Ontario v. Canada (Attorney General): A law that excludes
“Second Labour Trilogy” RCMP members from the general labour relations legislation and imposes a collective
bargaining representative violated freedom of association. It deprived RCMP members
of the right to select their own employee association that is independent from the
employer and to make representations to their employer through that association.
Saskatchewan Federation of Labour v. Saskatchewan: The Supreme Court overruled the

First Labour Trilogy decisions and ruled that freedom of association protects a right to
strike as a necessary component of meaningful collective bargaining.
Meredith v. Canada (Attorney General): A law that temporarily fixed the level of wage
increases for RCMP members did not violate section 2(d), because the restrictions were
minor (the wage rates imposed reflected what other unions had bargained elsewhere in
the public service), they were time limited (three years), and the statute still permitted
the workers’ association to bargain additional allowances for members.
a. The Early Years: “Freedom of Association” Does Not Protect Collective

Bargaining or a Right to Strike
Early in the life of the Charter, in a set of three decisions released in 1987 (known collectively as
the “First Labour Trilogy”), the Supreme Court explained that freedom of association is to be
interpreted narrowly to include only the following:
• a freedom to form and to join associations, including unions; therefore, a law prohibiting
people from forming or joining a union or other employee association would infringe
section 2(d) of the Charter;
• a freedom to engage collectively in the exercise of constitutional rights; and
• a freedom to engage in activities through an association that individuals are legally en-
titled to do; for example, since individuals are legally entitled to play golf, the government
would violate section 2(d) by prohibiting golf associations.30
That was a narrow reading of the scope of “freedom of association,” and applying it in the
First Labour Trilogy cases, the Supreme Court ruled that section 2(d) did not include a “right
to strike.” It found that striking was an inherently “collective” activity and, therefore, since the
Supreme Court considered that individual workers do not have a legal right to strike, there was
no Charter-protected right to strike.31 The Supreme Court also encouraged deference to gov-
ernments in striking a complex balance between competing interests in relation to labour
policy matters. Applying the same logic in the 1990 case of Professional Institute of the Public
Service of Canada v. Northwest Territories (Commissioner) (known as the PIPS decision), the
Supreme Court ruled that section 2(d) also does not protect a right to collective
bargaining.32
Litigation under section 2(d) of the Charter quieted down after those early cases since section
2(d) was considered to be a hollow freedom in the collective bargaining context. In a famous
dissent in one of the First Labour Trilogy decisions (Re Alberta Reference), Chief Justice Brian
Dickson of the Supreme Court of Canada argued that the majority of the court had applied too
narrow an interpretation of freedom of association that had rendered the freedom “vapid”:

Freedom of association is the freedom to combine together for the pursuit of common purposes or
the advancement of common causes. It is one of the fundamental freedoms guaranteed by the Char-
ter, a sine qua non of any free and democratic society, protecting individuals from the vulnerability
of isolation and ensuring the potential of effective participation in society. In every area of human
endeavour and throughout history individuals have formed associations for the pursuit of common
interests and aspirations. Through association individuals are able to ensure that they have a voice
in shaping the circumstances integral to their needs, rights and freedoms.
Freedom of association is the cornerstone of modern labour relations. Historically, workers have
combined to overcome the inherent inequalities of bargaining power in the employment relationship
and to protect themselves from unfair, unsafe, or exploitative working conditions. … If freedom of
association only protects the joining together of persons for common purposes, but not the pursuit of the
very activities for which the association was formed, then the freedom is indeed legalistic, ungenerous,
indeed vapid.33
Chief Justice Dickson would have found that “freedom of association” protect both a right to
collective bargaining and a right to strike, but he was outvoted by a majority of his Supreme
Court colleagues. However, as we will see below, his dissent in Re Alberta Reference proved
highly influential in convincing the Supreme Court to overrule the First Labour Trilogy
approach years later in the “Second Labour Trilogy.”
Brian Dickson, Chief Justice of the Supreme Court of Canada

from 1984 to 1990.
Source: CP Photo/Ron Poling.
b. Cracks in the First Labour Trilogy: Dunmore (2001), BC Health Services

(2007), and Fraser (2011)
The practical result of the First Labour Trilogy’s narrow application of freedom of association
was that governments could, for example, continue to ban or restrict strikes and to exclude spe-
cific groups of workers altogether from collective bargaining statutes that granted other workers
a robust set of legal entitlements intended to bolster their right to collective bargaining. How-
ever, as the 21st century dawned, cracks began to appear in the First Labour Trilogy as the Su-
preme Court shifted toward a broader interpretation of section 2(d) of the Charter.

The first sign of change came in the 2001 case of Dunmore v. Ontario (Attorney General),
which challenged the exclusion of farm workers from the Ontario Labour Relations Act, 1995 as
a violation of their freedom to associate.34 The exclusion of farm workers from the collective
bargaining statute and its protections from unfair labour practices meant that farm workers
were effectively left in the common law regime. Consequently, they could be dismissed or dis-
criminated against by employers if they attempted to unionize or exercise other collective labour
rights (such as striking).
The Supreme Court ruled in Dunmore that Chief Justice Dickson was correct in his dissent
when he found that freedom of association must include protection of some activities that are
inherently collective, such as “making collective representations to an employer.”35 The history
of farm workers’ attempts to associate showed that while unionization was not expressly pro-
hibited by any law, farm workers were nevertheless unable to associate because they had no legal
rights protecting them from employer reprisals for unionizing.36 On that basis, the Supreme
Court found that while section 2(d) of the Charter did not provide a right to full-fledged “Wag-
ner model” ‑ style collective bargaining, the legislation must at least provide workers with pro
tections against unfair labour practices when the absence of those protections effectively stifles
their ability to unionize.37
Dunmore is a tricky case because it was not obvious what the government action being chal-
lenged was. Recall that the Charter only directly regulates governments. The farm workers’
claim in Dunmore was that they could not join unions and make collective representations to
employers because their private sector employers might threaten or dismiss them, and there was
no law stopping their employers from doing so. In other words, the argument was that the gov-
ernment action consisted of a failure of the government—an omission—to apply to farm work-
ers the unfair labour practice sections in the Labour Relations Act, 1995 that apply to most other
workers. The Supreme Court got around the “state action” limitation in Dunmore by holding
that when a government creates a protective legal regime (such as the Labour Relations Act,
1995), it cannot then exclude some workers from the protections if doing so “substantially inter-
feres” with the ability of those workers to exercise the rights protected by freedom of
association.38
The next big step in the development of section 2(d) of the Charter occurred in 2007, when
the Supreme Court released its decision on Health Services and Support—Facilities Subsector
Bargaining Assn v. British Columbia (“BC Health Services”).39 In this case, unionized health care
workers brought a Charter challenge against a new law (Health and Social Services Delivery
Improvement Act) that suspended collective bargaining in the health sector, unilaterally imposed
new collective agreement terms and cancelled others, and prohibited unions from bargaining
about certain topics. According to the government, the act was adopted to deal with a crisis in
relation to the high medical costs in the province. To the surprise of many in the labour law
community, the Supreme Court ruled that it was time to recognize a right to collective bargain-
ing under section 2(d). Expressly rejecting the logic of its previous holdings, the Supreme Court
found that this new constitutional right to collective bargaining imposes an obligation on gov-
ernment employers to bargain in good faith and to consult with unions before passing laws that
negatively impact collective bargaining and collective agreements.
Next came the 2011 case of Ontario (Attorney General) v. Fraser, which arose after the
Ontario government responded to the Dunmore decision by passing the Agricultural Employees
Protection Act (AEPA).40 The AEPA did precisely as the Supreme Court had ordered in Dun-
more, and nothing more.41 It provided protections against unfair labour practices and the ability
to make “collective representations,” but it did not include an expressed “duty to bargain in good
faith,” nor did it provide any protections for strike action or any alternative dispute resolution
mechanism (such as impartial binding arbitration). In 2011, a majority of the Supreme Court
ruled that the AEPA did not violate section 2(d).

In Fraser, the Supreme Court held that section 2(d) of the Charter does not require that every
worker be given access to the key elements of the Wagner model found in the Labour Relations
Act, 1995. The Supreme Court ruled that it was implied in the AEPA that agricultural employers
hear and consider “representations” by workers’ associations and that they do so “in good faith”
and that this was sufficient to fulfill the constitutional right to collectively bargain, even though
it fell far short of the full-fledged “duty to bargain in good faith” found in collective bargaining
legislation (see Chapter 33). In other words, as long as the law requires employers to listen and
consider collective employee representations, it satisfies section 2(d). The Supreme Court
emphasized that under section 2(d), “no particular type of bargaining is protected.” Rather, “[i]n
every case, the question is whether the impugned law or state action has the effect of making it
impossible to act collectively to achieve workplace goals.”42
c. The “Second Labour Trilogy” (2015)

If Fraser showed the Supreme Court hitting the brakes on the constitutional right to collectively
bargain after BC Health Services, the court shifted back into high gear in 2015, releasing another
trilogy of decisions (the “Second Labour Trilogy”). In these three cases, the Supreme Court re-
affirmed and broadened its rulings in Dunmore and BC Health Services and confined whatever
remained of the First Labour Trilogy and, arguably, Fraser to the dustbin of past section 2(d)
decisions.
In the first case in the Second Labour Trilogy, Mounted Police Association of Ontario v.
Canada (Attorney General),43 the Supreme Court affirmed that the freedom to associate entails
both the freedom to create an employee association that is independent from the employer and
the right to engage in a process of meaningful collective bargaining through that chosen asso-
ciation. The problem with the model of collective bargaining provided in the legislation that was
at issue was that the collective bargaining representative it imposed on RCMP members was
“plainly not independent of RCMP management. Rather, it is squarely under its control.”44 As a
result, excluding RCMP members from the general labour relations legislation and imposing
this alternative bargaining regime violated section 2(d) and was not saved by section 1.
A few weeks later, in Saskatchewan Federation of Labour v. Saskatchewan, the Supreme Court
definitively overturned the rulings in the First Labour Trilogy when it decided that freedom of
association protects a limited right to strike.45 See Box 39.7.

Does the Charter Protect a Right to Strike?
Saskatchewan Federation of Labour v. Saskatchewan tion of Labour challenged the legislation as a violation of
2015 SCC 4 section 2(d) of the Charter.
Key Facts: Saskatchewan enacted the Public Service Essential Issue: Does legislation that prohibits employees designated
Services Act, which prohibited “essential services employees” by the employer as “essential services employees” from striking
from striking. It defined “essential services” broadly and grant- infringe section 2(d) of the Charter by substantially interfering
ed the employer the unilateral right to determine which and with the Charter right to meaningful collective bargaining?
how many employees were “essential.” The legislation effect-
Decision: Yes. By a majority of 5 to 2, the Supreme Court ruled
ively permitted the employer to ensure that large numbers of
that “freedom of association” protects the right to strike, there-
public sector workers could not engage in a strike. Moreover,
by overturning the rulings in the First Labour Trilogy of 1987.
the legislation did not provide for a neutral substitute mech-
Justice Abella, for the majority, ruled that the time had come
anism (such as interest arbitration) for determining bargaining
for the right to strike to be given the Supreme Court’s “consti-
disputes in the event of an impasse. The Saskatchewan Federa-
tutional benediction.” The Supreme Court wrote that striking
was “the ‘powerhouse’ of collective bargaining” that promotes

equality in collective bargaining in a system in which there 1 because it went further than it needed to protect the public
exists a fundamental power imbalance between employers through the continuance of true essential services. Many of
and employees. A right to meaningful collective bargaining the employees that the employer could unilaterally designate
necessarily requires a right to strike: “the ability to engage in as “essential services employees” were not essential at all.
the collective withdrawal of services is a necessary component Moreover, even for employees who were essential, the legis-
of the process through which workers can continue to partici- lation failed to provide any meaningful alternative mechanism
pate meaningfully in the pursuit of their collective workplace for resolving bargaining impasses, such as interest arbitration.
goals.” The Saskatchewan legislation violated section 2(d) of The Supreme Court ruled that the Saskatchewan legislation
the Charter by banning the right to strike at the conclusion of was unconstitutional.
a collective agreement, and the law was not saved by section
The final decision in the Second Labour Trilogy, Meredith v. Canada (Attorney General),
involved circumstances similar to BC Health Services, in that collective agreement entitlements
(wage raises, in this case) for RCMP members had been limited by legislation.46 Meredith arose
out of the Expenditure Restraint Act, which rolled back scheduled wage increases across the
federal public sector in light of a financial crisis, provoking a flurry of section 2(d) litigation
across the country. The Supreme Court held that, on the facts of that case, the legislation did not
“substantially interfere” with a meaningful process of collective bargaining and did not violate
section 2(d). The reasoning in Meredith is scanty. However, it appears to have turned on the fact
that the wage rates imposed by the legislation were generally in accordance with wage rates
bargained elsewhere in the public service and following consultations with employee associa-
tions, the imposed wage rates were time limited (three years), and the employee association
could still negotiate additional monetary allowances for its members.
d. Freedom of Association Cases After the Second Labour Trilogy

In the wake of the 2015 Second Labour Trilogy, there have been many new Charter challenges
filed alleging that governments have infringed section 2(d) freedom of association. We can
quickly summarize some of these decisions.
i. Charter Violated
• British Columbia Teachers Federation v. British Columbia (2016, Supreme Court of
Canada): The BC government violated the freedom of association of unionized teachers
when it enacted a law (Bill 22) that voided certain terms of a collective agreement and
prohibited the inclusion of similar terms in future collective agreements. The terms in
question related to matters such as class size, staffing levels and ratios, and teaching
loads. The Supreme Court ruled that the law amounted a “substantial interference” with
the right to collective bargaining of the teachers and that the government had failed to
engage in a meaningful process of consultation with the teachers’ union prior to enact-
ing the law. The government went through the process of talking with the union, but it
had no intention of changing its position. The violation was not saved by section 1.47
• OPSEU v. Ontario (2016, Ontario Superior Court of Justice): The government violated
section 2(d) when it enacted the Putting Students First Act, which restricted five teachers’
unions from bargaining terms of employment that were “substantially different” than
those bargained by a single other union, and then effectively imposed the terms bar-
gained by the other union if the five unions did not reach a deal with the province by a
fixed date. The court ruled that the model of collective bargaining established by the
legislation substantially interfered with a process of meaningful collective bargaining
for the five unions contrary to section 2(d). The violation was not saved by section 1.48

• Canadian Union of Postal Workers v. Canada (2016, Ontario Superior Court of Justice):
Back-to-work legislation (see Chapter 34) passed to end a strike at Canada Post vio-
lated section 2(d) and was not saved by section 1. The legislation clearly restricted the
workers’ Charter-protected right to strike. The right to strike is protected insofar as it
contributes to a meaningful process of collective bargaining. Here, the parties were
bargaining and working toward a deal until it was clear that the government intended
to pass the back-to-work legislation. At that point, Canada Post hardened its position
and bargaining stalled.49
ii. Charter Not Violated

• In a series of 2016 decisions following up on the Meredith case involving the question
of whether wage rollback legislation violated freedom of association, appeal courts in
British Columbia, Ontario, and Quebec ruled that the legislation did not violate section
2(d) because the limitations it imposed were short term and did not amount to a “sub-
stantial” interference with meaningful bargaining and the governments engaged in
extended “good faith” dialogue with the unions involved prior to imposing the changes.50
• Union of Canadian Correctional Officers—Syndicat des agents correctionnels du Canada
- CSN (UCCO-SACC-CSN) (2019, Quebec Court of Appeal): A statute that prohibited
unions from negotiating over pensions and retirement benefits violated section 2(d)
by preventing meaningful collective bargaining over matters of importance, but the
violation was saved by section 1.51
e. Summing Up: Where Are We Now on the Charter Freedom to Associate?

As you can see, the development of the scope of freedom of association under the Charter has
been a slow and laboured exercise. Even seasoned lawyers have difficulty explaining to their
clients what it all means and what the Supreme Court is likely to do next. To summarize, there
are effectively three core (and interrelated) rights protected under section 2(d), which closely
mirror the key statutory protections in the Wagner model: (1) the right to join, form, and belong
to a union; (2) the right to collective bargaining; and (3) the right to strike. The Supreme Court
has described the substance of the latter two rights as rights of workers to join together to meet
on more equal terms the power and strength of employers. In particular, workers now have a
Charter right to a “meaningful process of collective bargaining,” and any government action that
“substantially interferes” with that right contravenes section 2(d). Table 39.2 provides a quick
summary of the content of each set of rights as they stand at the time of writing.
TABLE 39.2 A Snapshot of the Present (2019) Scope of Freedom of Association

Collective Activity State of Section 2(d) Jurisprudence
The right to join, • Laws that prohibit workers from forming or joining associations that are in-
form, and belong dependent of the employer and that represent the employees’ interests violate
to a union section 2(d) of the Charter. See First Labour Trilogy; Dunmore v. Ontario (Attorney
General) (2001); and Mounted Police Association of Ontario v. Canada (Attorney
General) (2015).
• Government employers that discriminate against workers for exercising the right
to associate violate section 2(d). See Delisle v. Canada (Deputy Attorney General)
(1999).
• If governments exclude a type of worker from protective collective bargaining

legislation and as a result those workers are effectively unable to join and form
unions, then the omission from the protective legislation violates section 2(d).
See Dunmore v. Ontario (Attorney General) (2001).

The right to collective • A law or other government action that prohibits or suspends collective bargain-
bargaining ing or that cancels collectively bargained contract terms infringes upon section
2(d) if (1) the matter involved is sufficiently important to employees that the
government’s actions amount to a “substantial interference” with a “meaningful
process of collective bargaining”; and (2) the government failed to “bargain” or
“consult” in good faith. See BC Health Services (2007); Meredith (2015), BCTF (2016).
• A legal model that imposes an association on employees that is not independent

of the employer and mandates the employer to consult or bargain only with that
association violates section 2(d). See Saskatchewan Federation of Labour v. Sas-
katchewan (2015).
The right to strike • A law that explicitly bans the right of workers to strike at the conclusion of a
collective agreement, or that renders that right to strike effectively meaningless,
violates section 2(d). See Saskatchewan Federation of Labour v. Saskatchewan
(2015); Canada Post (2016).
• A law that bans a strike by truly essential services workers and that does not
provide a substitute neutral alternative dispute resolution process such as inter-
est arbitration violates section 2(d) and is unlikely to be saved by section 1. See
Saskatchewan Federation of Labour v. Saskatchewan (2015).
f. Freedom to NOT Associate: Lavigne (1991) and Advance

Cutting & Coring Ltd. (2001)
Two additional cases are noteworthy in this section because they raise the difficult question of
“negative freedom of association”—the freedom to not associate. That is, does section 2(d) of the
Charter protect against “forced” association, in the same way that freedom of expression pro-
tects against compelled speech52 and freedom of religion protects freedom from religion?53
Two common practices in labour law have been challenged as amounting to “forced” associ-
ation contrary to section 2(d) of the Charter. The first arose in the 1991 case of Lavigne v.
Ontario Public Service Employees Union, in which an employee of a college was covered by a
collective agreement that required all bargaining unit employees to pay union dues, a
common collective agreement term in Canada that has legislative support (Chapter 37).54 Lavi-
gne argued that his employer (the government) had violated his freedom of association by
agreeing to a provision that obliged him to pay union dues, a portion of which were then used
by the union to fund some causes with which Lavigne did not agree, including funding the New
Democratic Party.
The Supreme Court ruled that the collective agreement clause did not violate the Charter
rights of Lavigne, although the judges disagreed on why. Four of the judges ruled that the
requirement for Lavigne to pay money toward causes he did not agree with did violate section
2(d), but that the violation was “saved” by section 1, because unions serve an important function
in society in contributing to public debate. Another three judges ruled that section 2(d) was not
violated at all, since freedom of association does not include a freedom not to associate.
The second case that raised the issue of the freedom to not associate is R v. Advance Cutting
& Coring Ltd.55 In 2001, this case challenged Quebec legislation that required construction
workers to join one of five unions. Did this “compulsory unionism” violate a freedom not to
associate? The judges decided that it did not, but as in Lavigne, there was profound disagreement
on why. Eight of the nine Supreme Court judges ruled that section 2(d) of the Charter includes
a “right not to associate.” Five of the nine judges ruled that this right was violated in this case.
However, by a score of five to four, the Supreme Court ruled ultimately that the violation was
saved by section 1, on the basis that there were important characteristics of the Quebec con-
struction industry that justified the infringement.

V. Chapter Summary
The Canadian Charter of Rights and Freedoms is part of Canada’s Constitution. It regulates the
relationship between governments and citizens, not the relationships between private citizens
and private companies. It sets limits on government conduct and also regulates how govern-
ments can treat their own employees. This chapter considered the ways in which the Charter has
influenced the development of the law of work. Its greatest impact has been felt in the collective
bargaining regime. This is because Canadian collective bargaining, since the 1940s, has been
tightly regulated, as we learned in Part IV of this book. Since the turn of the century, the Su-
preme Court has developed a more robust interpretation of “freedom of association” found in
section 2(d) of the Charter than in the past. In particular, by recognizing that this freedom
encompasses a right to collective bargaining and to strike, the Supreme Court has subjected all
legislation and other government action that restricts these rights to Charter scrutiny. This
chapter examined this history and many of the most important Charter decisions.

1. Explain the meaning of “enumerated grounds” and “analogous grounds” in the context of
the Charter. Provide two examples of analogous grounds.
2. Describe the steps of the Oakes test.
3. What happens to legislation that is found to be in violation of the Charter?
4. Why has the Charter had relatively little influence on the development of the common law
regime of work law?
5. Section 15 of the Charter protects the right of Canadians to be treated equally, without
regard to sex, age, religion, disability, and other grounds. Why then do we also need human
rights codes in Canada that also prohibit discrimination on similar grounds?
6. Explain how the interpretation of section 2(d) of the Charter in the First Labour Trilogy
(1987) along with the PIPS decision (1990) differs from the decisions issued by the Su-
preme Court since 2000, including BC Health Services (2007) and the Second Labour
Trilogy decisions in 2015.
7. Describe the elements of picketing that are protected by section 2(b) (freedom of expres-
sion) of the Charter, and the possible limits on that freedom.
APPLYING THE LAW

1. Winefried was dismissed from her job at Microsoft in legislation by finding it on CanLII. Section 15 of the act
Ottawa. She believes that the reason is related to her states “that employees to whom this Act applies shall
boss’s intolerance of her religion. She wants to launch a not strike and the employer shall not lock them out.”
Charter challenge against her employer, alleging that Any bargaining disputes must be referred to an interest
her section 15 equality rights have been violated. arbitrator. Assume that a union representing TTC em-
Would you advise her to go ahead with that lawsuit? ployees has filed a Charter challenge against the legis-
2. In 2011, the Ontario government enacted legislation lation. Discuss whether you believe a court would find
that prohibits all employees of the Toronto Transit (a) that the legislation violates section 2(d) of the Char-
Commission (TTC) from striking. The legislation is ter and (b) if so, whether that violation would be “saved
called the Toronto Transit Commission Labour Disputes by section 1.”
Resolution Act, 2011, SO 2011, c. 2. You can read the


1. Canadian Charter of Rights and Freedoms, Part I of the 15. The “test” for section 15 equality cases is described in the
Constitution Act, 1982, being Schedule B to the Canada non-labour cases Law v. Canada, [1999] 1 SCR 497 and
Act 1982 (UK), 1982, c. 11. Andrews v. Law Society of British Columbia, [1989] 1 SCR
2. See D. Doorey, “The Redemption of David Beatty (and 143. See also Ontario (Attorney General) v. Fraser, 2011
Other Thoughts on the Future of Labour Law)” (2020) SCC 20 at paras 114-16. It is a difficult test, and for our
75(2) Indus Rel (forthcoming); B. Etherington, “An Assess- purposes we do not need to analyze it in detail since
ment of Judicial Review of Labour Laws under the section 15’s influence on work law has been limited. See
Charter: Of Realists, Romantics, and Pragmatists” (1992) also Ontario Nurses’ Association v. Mount Sinai Hospital,
24 Ottawa L Rev 685. 2005 CanLII 14437 (Ont. CA), which struck down exclu-
sion from statutory severance pay due to “frustration of
3. H. Arthurs, “’The Right to Golf ’: Reflections on the Future
contract” that arises from disability.
of Workers, Unions, and the Rest of Us Under the
Charter” (1988) 13:2 Queen’s LJ 17; H. Arthurs, “Constitu- 16. Egan v. Canada, supra note 8; and Vriend v. Alberta, [1998]
tionalizing the Right of Workers to Organize, Bargain, and 1 SCR 493.
Strike: The Sight of One Shoulder Struggling” (2009 – 10) 17. The Supreme Court ruled that laws or employment prac-
15 CLELJ 373. tices by government employers that treat married people
4. Charter, supra note 1, s. 32. differently than non-married people would violate section
15, since “marital status” was an analogous ground: Miron
5. Lavigne v. Ontario Public Service Employees Union, [1991]
v. Trudel, [1995] 2 SCR 418.
2 SCR 211.
18. Andrews v. Law Society of British Columbia, supra note 15.
6. McKinney v. University of Guelph, [1990] 3 SCR 229.
19. See Health Services and Support—Facilities Subsector Bar-
7. Ibid.
gaining Assn. v. British Columbia, 2007 SCC 27 at paras
8. Egan v. Canada, [1995] 2 SCR 513. 162-67; and Dunmore v. Ontario (Attorney General), 2001
9. R v. Oakes, [1986] 1 SCR 103. In Doré v. Barreau du SCC 94. In the Dunmore decision, Justice L’Heureux-
Québec, 2012 SCC 12, the court introduced an alternative Dubé, in dissent, said that the occupational status of an
“administrative law approach” to be applied in cases of the agricultural worker should be recognized as an analogous
exercise of discretion by administrative decision makers. ground; see paras 165-70. For a critique of the Supreme
For an application of Doré in labour context, see Govan Court’s rejection of section 15 as a basis for extending the
Brown & Associates Limited, 2018 CanLII 27199 (Ont. reach of collective bargaining statutes to excluded workers,
LRB). see B. Langille, “The Freedom of Association Mess: How
10. See G. England, “The Impact of the Charter on Individual We Got into It and How We Can Get out of It” (2009) 54
Employment Law in Canada: Rewriting an Old Story” McGill LJ 177; and D. Pothier, “Twenty Years of Labour
(2006) 13 CLELJ 1. Law and the Charter” (2002) 40 Osgoode Hall LJ 369.
11. RWDSU v. Dolphin Delivery Ltd., [1986] 2 SCR 573; and 20. Quebec and Manitoba have protected workers older than
Hill v. Church of Scientology of Toronto, [1995] 2 SCR 64 from age discrimination since the 1980s. Ontario
1130. amended its human rights legislation in 2006 to do the
same and other provinces followed: British Columbia (in
12. RWDSU, Local 558 v. Pepsi-Cola Canada Beverages (West) 2008), Saskatchewan (in 2007), Nova Scotia (in 2009), and
Ltd., 2002 SCC 8. Newfoundland and Labrador (in 2007). The federal gov-
13. Hersees of Woodstock Ltd. v. Goldstein et al., 1963 CanLII ernment revised the Canadian Human Rights Act (RSC
151 (Ont. CA). This decision was among the most contro- 1985, c. H-6) in 2011 in a similar manner. See the discus-
versial and criticized labour law decisions of the 20th sion in CBC News, “Mandatory Retirement Fades in
century. See H. Arthurs, “Comments” (1963) 41 Can Bar Canada” (August 2009), online: <http://www.cbc.ca/news/
Rev 573, explaining how the court of appeal misapplied business/mandatory-retirement-fades-in-canada-1
tort law to reach the conclusion that all secondary picket- .799697>.
ing is per se illegal. See also B. Langille & B. Oliphant, 21. The Vriend decision provoked a huge body of academic
“From Rand to Rothstein: Labour Law, Fundamental commentary on the scope of a government’s right to
Values and the Judicial Role” in I. Entchev & L.M. Kelly, decide which personal characteristics are deserving of pro-
eds, Judicious Restraint: The Life and Law of Justice Mar- tection from employment discrimination. See, for
shall E. Rothstein (Markham, ON: LexisNexis Canada, example, F.C. DeCoste, “Case Comment: Vriend v. Alberta:
2016) 259-60, and the sources cited therein. Sexual Orientation and Liberal Polity” (1996) 34 Alta L
14. Pepsi-Cola Canada Beverages (West) Ltd., supra note 12 at Rev 950; and L. Gotell, “Queering Law: Not by Vriend”
para 32. (2002) 17 Can J L & Soc 89.

22. Quebec (Attorney General) v. Alliance du personnel profes- 33. Re Alberta Reference, supra note 30 at para 81.
sionnel et technique de la santé et des services sociaux, 2018 34. Dunmore v. Ontario (Attorney General), supra note 19. See
SCC 17. See also Centrale des syndicats du Québec v. also Labour Relations Act, 1995, SO 1995, c. 1, Sched. A.
Quebec (Attorney General), 2018 SCC 18 (a provision in
35. Dunmore v. Ontario (Attorney General), supra note 34 at
pay equity legislation that delayed implementation of pay
para 17.
equity violated section 15, but was saved by section 1).
36. See F. Faraday, J. Fudge, & E. Tucker, Constitutional Labour
23. See, generally, P. W. Hogg, Constitutional Law of Canada,
Rights in Canada: Farm Workers and the Fraser Case
5th ed [looseleaf] (Toronto, ON: Carswell, 2012) at §43.5.
(Toronto, ON: Irwin Law, 2012). In Dunmore v. Ontario
24. Cardinal Transportation BC Inc. (1997), 34 CLRBR (2d) 1 (Attorney General), supra note 34, the Supreme Court dis-
(BCLRB). See also comments in Wal-Mart Canada Corp. tinguished the farm workers’ circumstance from that of
v. United Food and Commercial Workers, Local 1400, 2004 others without access to Wagner model – style collective
SKCA 154 at para 53; and Bank of Montreal (1985), 10 bargaining. For example, it referred to the case of Delisle v.
CLRBR (NS) 129. Canada (Deputy Attorney General), [1999] 2 SCR 989,
25. RWDSU v. Dolphin Delivery Ltd., supra note 11. We will where the Supreme Court found that the exclusion of
focus primarily on picketing in this section of the chapter. police officers from collective bargaining legislation did
However, freedom of expression comes up in other aspects not violate section 2(d) because the police had neverthe-
of labour law as well. One example is in the case of Lavigne less been able to effectively organize themselves.
v. Ontario Public Service Employees Union, supra note 5, 37. Dunmore v. Ontario (Attorney General), supra note 34 at
discussed later in this chapter. In this case, the Supreme para 17 (“This is not to say that all such activities are pro-
Court ruled that Lavigne’s freedom of expression was not tected by s. 2(d), nor that all collectivities are worthy of
infringed when he was forced to pay money toward causes constitutional protection; indeed, this Court has repeat-
he disagreed with, because he was still able to express edly excluded the right to strike and collectively bargain
himself as he saw fit. from the protected ambit of s. 2(d)”).
26. U.F.C.W., Local 1518 v. KMart Canada Ltd., [1999] 2 SCR 38. The other basis upon which the Supreme Court rested this
1083. See also Fletcher Challenge Canada Ltd. v. Communi- finding is that the statutory exclusion had a “chilling” effect
cations, Energy and Paperworkers Union of Canada, 1998 on associational activities. See the discussion in Langille &
CanLII 6528 (BCCA). Oliphant, supra note 13 at 262-65.
27. U.F.C.W., Local 1518 v. KMart Canada Ltd., supra note 26 39. Health Services and Support—Facilities Subsector Bargain-
at para 42. ing Assn. v. British Columbia, supra note 19.
28. Alberta (Information and Privacy Commissioner) v. United 40. Ontario (Attorney General) v. Fraser, supra note 15.
Food and Commercial Workers, Local 401, 2013 SCC 62.
41. Agricultural Employees Protection Act, 2002, SO 2002,
The images were posted on the provocatively titled website
c. 16.
www.casinoscabs.com (the site is no longer active).
42. Ontario (Attorney General) v. Fraser, supra note 15 at para
29. B.C.G.E.U. v. British Columbia (Attorney General), [1988] 2
46. Fraser was widely considered a retrenchment from the
SCR 214.
holding in BC Health Services, narrowing the scope of
30. The 1987 First Labour Trilogy comprises Reference Re section 2(d) protection for labour rights. See, for example,
Public Service Employee Relations Act (Alta.), [1987] 1 SCR S. Barrett, “The Supreme Court of Canada’s Decision in
313; [1987] 1 SCR 424; and RWDSU v. Saskatchewan, Fraser: Stepping Forward, Backward or Sideways?” (2012)
[1987] 1 SCR 460. For more on the “right to golf ” anec- 16:2 CLELJ 331; and J. Fudge, “Constitutional Rights, Col-
dote, see Arthurs, supra note 3. lective Bargaining and the Supreme Court of Canada:
31. Many scholars have challenged the court’s conclusion that Retreat and Reversal in the Fraser Case” (2012) 41:1 Indus
there is no individual right to withdraw labour: D. Beatty LJ 1.
& S. Kennett, “Striking Back: Fighting Words, Social 43. Mounted Police Association of Ontario v. Canada (Attorney
Protest and Political Participation in Free and Democratic General), 2015 SCC 1.
Societies” (1988) 13 Queen’s LJ 214; D. Pothier, “Twenty
Years of Labour Law and the Charter” (2002) 40 Osgoode
Hall LJ 369 at 376-77; and B. Oliphant, “Exiting the 45. Saskatchewan Federation of Labour v. Saskatchewan, 2015
Freedom of Association Labyrinth: Resurrecting the Paral- SCC 4.
lel Liberty Standard Under 2(d) & Saving the Freedom to 46. Meredith v. Canada (Attorney General), 2015 SCC 2.
Strike” (2012) 70:2 UT Fac L Rev 36. 47. British Columbia Teachers’ Federation v. British Columbia,
32. Professional Institute of the Public Service of Canada v. 2016 SCC 49 (the Supreme Court decision was brief and
Northwest Territories (Commissioner), [1990] 2 SCR 367. simply endorsed the reasons of the dissenting judge,

Justice Donald, in the BC Court of Appeal: British Col- 51. Union of Canadian Correctional Officers—Syndicat des
umbia Teachers’ Federation v. British Columbia, 2015 agents correctionnels du Canada - CSN (UCCO-SACC-
BCCA 184). CSN), 2019 QCCA 979.
48. OPSEU v. Ontario, 2016 ONSC 2197. 52. See, for example, RJR-MacDonald Inc. v. Canada (Attorney
49. Canadian Union of Postal Workers v. Her Majesty in Right General), [1995] 3 SCR 199 at para 124, citing Slaight Com-
of Canada, 2016 ONSC 418. munications Inc. v. Davidson, [1989] 1 SCR 1038.
50. See Federal Government Dockyard Trades and Labour 53. See, for example, Mouvement laïque québécois v. Saguenay
Council v. Canada (Attorney General), 2016 BCCA 156; (City), 2015 SCC 16 at paras 70-76.
Gordon v. Canada (Attorney General), 2016 ONCA 625; 54. Lavigne v. Ontario Public Service Employees Union, supra
and Canada (Procureur général) c. Syndicat canadien de la note 5.
fonction publique, section locale 675, 2016 QCCA 163. 55. R v. Advance Cutting & Coring Ltd., 2001 SCC 70.

Selected Cases: Part V
Advance Cutting & Coring Ltd., R v., 2001 SCC 70 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 700, 704
Alberta (Information and Privacy Commissioner) v. United Food and Commercial Workers,
Local 401, 2013 SCC 62 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 692, 703
British Columbia Teachers’ Federation v. British Columbia, 2016 SCC 49 . . . . . . . . . . . . . . . . . . . . . . . . . 698, 703
B.C.G.E.U. v. British Columbia (Attorney General), [1988] 2 SCR 214 . . . . . . . . . . . . . . . . . . . . . . . . . . . 692, 703
Canadian Union of Postal Workers v. Canada, 2016 ONSC 418 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 699, 704
Delisle v. Canada (Deputy Attorney General), [1999] 2 SCR 989 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 699, 703
Dunmore v. Ontario (Attorney General), 2001 SCC 94 . . . . . . . . . . . . . . 693, 694, 695, 696, 697, 699, 702, 703
Federal Government Dockyard Trades and Labour Council v. Canada (Attorney General),
2016 BCCA 156 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 704
Gordon v. Canada (Attorney General), 2016 ONCA 625 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 704
Health Services and Support—Facilities Subsector Bargaining Assn. v. British Columbia,
2007 SCC 27, rev’g 2004 BCCA 377 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 693, 696, 702, 703
Lavigne v. Ontario Public Service Employees Union, [1991] 2 SCR 211 . . . . . . . . . . . . . . 683, 700, 702, 703, 704
McKinney v. University of Guelph, [1990] 3 SCR 229 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 684, 686, 688, 702
Meredith v. Canada (Attorney General), 2015 SCC 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 694, 698, 699, 700, 703
Mounted Police Association of Ontario v. Canada (Attorney General), 2015 SCC 1 . . . . . . . . 694, 697, 699, 703
Oakes, R v., [1986] 1 SCR 103 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 685, 688, 689, 692, 701, 702
Ontario (Attorney General) v. Fraser, 2011 SCC 20 . . . . . . . . . . . . . . . . . . . . . . 693, 694, 695, 696, 697, 702, 703
OPSEU v. Ontario, 2016 ONSC 2197 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 698, 704
Professional Institute of the Public Service of Canada v. Northwest Territories (Commissioner),
[1990] 2 SCR 367 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 693, 694, 703
PSAC v. Canada, [1987] 1 SCR 424 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 693
Reference Re Public Service Employee Relations Act (Alta.), [1987] 1 SCR 313 . . . . . . . . . . . . . . . . . . . . . 693, 703
RWDSU v. Dolphin Delivery Ltd., [1986] 2 SCR 573 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 691, 702, 703
RWDSU v. Saskatchewan, [1987] 1 SCR 460 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 693, 703
Saskatchewan Federation of Labour v. Saskatchewan, 2015 SCC 4 . . . . . . . . . . . . . . . . . . . . . . 694, 697, 700, 703
Union of Canadian Correctional Officers—Syndicat des agents correctionnels du Canada—CSN
(UCCO-SACC-CSN), 2019 QCCA 979 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 699, 704
U.F.C.W., Local 1518 v. KMart Canada Ltd., [1999] 2 SCR 1083 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 691, 703
Vriend v. Alberta, [1998] 1 SCR 493 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .685, 688, 689, 690, 702
705


Glossary
ability to pay principle: The principle that where provided by stat- apprentice: A worker who is learning a trade or craft under the guid-
ute, interest arbitrators may (or must) consider the government’s ance and supervision of a senior skilled worker in the field.
ability to pay when deciding the terms of their award.
appropriate bargaining unit: A grouping of jobs or employees that
acceptance of an employer’s repudiation of contract: When an a labour relations board decides is suitable to be represented together
employee responds to a repudiation of the employment contract by in collective bargaining.
the employer by treating the contract as over and quitting.
arises and occurs test: The test used by WCBs to determine whether
administrative leave: A period of time during which an employer re- an injury is compensable. In short, it is used to determine whether an
fuses an employee the right to report to work for reasons other than a lack injury arose from and occurred during the course of work.
of work (i.e., a layoff) or discipline (i.e., a suspension), usually during the
period of an ongoing investigation into possible employee misconduct. assault: A tort that involves a threat of imminent physical harm.
aggravated damages: Damages awarded to the innocent party that “at will” employment contract: An employment contract in which
compensate for mental or psychological pain and suffering caused by either party may terminate the contract at any time, for any or no
the guilty party’s wrongful act. reason, with no notice to the other party. This is the default model in
the United States. In Canada, employment standards legislation re-
ambiguous contract term: A contract term capable of multiple quires notice of termination and therefore prohibits at will contracts
interpretations. for employees covered by the legislation.
analogous grounds: Prohibited grounds of discrimination in equal- averaging agreement: A legislative device designed to facilitate
ity legislation that are not enumerated (listed) in the legislation, but flexibility in the calculation of an employee’s entitlement to overtime
which the courts have read into the legislation because of their simi- pay. An averaging agreement permits an employer and employee to
larity to the enumerated grounds that are protected (e.g., sexual ori- agree to average hours worked over a period longer than the standard
entation, marital status, and citizenship). period of time used to calculate overtime pay entitlement.
ancillary contract terms: Contract terms found in written materi- back-to-work legislation: A statute enacted for the specific purpose
als that are physically separate from an employment contract but of bringing an end to a lawful work stoppage by referring outstanding
that include rules that relate to the employment relationship. bargaining issues to an interest arbitrator for final resolution.
ancillary document: Written materials that are physically separate bad-faith discharge: When an employer dismisses an employee in a
from an employment contract but that include rules that relate to the manner that is dishonest, harsh, or insensitive to the feelings and
employment relationship. Examples include employee handbooks, vulnerability of the employee.
benefits handbooks, and human resources policy manuals.
balance of probabilities: An evidentiary standard of proof requiring
annual hire/general hire contract: If the parties did not expressly evidence that it is more likely than not that an incident occurred.
agree on the length of their employment contract, it was presumed in
law to last for one year. The annual hire contract was initially born out Bardal factors: Criteria considered by Canadian courts in assessing
of agricultural work. It allowed workers to be employed between the the length of time required by the implied obligation to provide “rea-
agricultural seasons, and ensured that workers would not leave their sonable notice” of termination of an employment contract. The name
employers right before a harvest. comes from the leading decision called Bardal v. Globe and Mail Ltd.,
decided in 1960.
anti-reprisal provisions: A statutory rule that prohibits an employer
from dismissing or otherwise punishing an employee for attempting bargaining concessions: When a party agrees to accept less in ne-
to enforce their statutory rights. gotiations than they initially proposed.
anti-union animus: The motive element of unfair labour practices; it bargaining structure: A term used to describe the identity and num-
means acting with an intention to defeat or undermine the exercise of ber of parties involved in collective bargaining, and the scope of em-
lawful activities by a union or union supporters. ployees covered by that bargaining.
application for certification: A formal legal document filed by an bargaining unit: A group of workers whose work is similar enough
employee or union with a labour relations board that commences a that they are thought capable to be covered by the same collective
process to determine whether the union qualifies to become the legal agreement. Importantly, not all bargaining unit members necessarily
collective bargaining representative of a group of employees. choose to join the union.
GL:707

GL:708 Glossary
bargaining unit employee: An employee whose job falls within a card check: A method used in Canadian collective bargaining legis-
bargaining unit that a union either represents or is seeking to lation to measure the level of employee support for unionization that
represent. involves counting the number of union membership or authorization
cards. If a majority of employees have signed cards, then the union is
battery: A tort that involves unwanted physical contact that either certified without a certification vote.
causes the victim harm or is offensive or insulting to the victim.
cartel: A combination of individuals or companies that attempt to
bilateral trade agreement: A trade agreement between two nations. use collective force or coordination to fix market prices.
bill: A draft of a proposed law to introduce a new statute or to amend certification: The process for legally recognizing a union as the exclu-
an existing one. sive bargaining agent of a particular group of workers.
binding precedent (or binding decision): An earlier decision by a certification freeze: A rule found in collective bargaining legislation
court of higher ranking dealing with the same legal issue in a case that that prohibits an employer from altering terms of employment with-
comes before a lower court judge. The lower court judge is required to out the union’s consent during the processing of an application for
apply the same reasoning and legal test applied by the higher court. certification.
Bolshevism: A term derived from the Bolshevik Party, which led the changed substratum doctrine: A legal doctrine in employment law in
Russian Revolution of 1917. Bolshevism refers to the methods, prac- which an employee’s job responsibilities have changed so substantially
tices, and beliefs of the party. from the time the original contract was executed that the courts rule the
bona fide occupational requirement (BFOR): A defence to dis- original “substratum” of the contract has ceased to exist. In this case, the
crimination that an employer may use to prove that a discriminatory court may refuse to enforce a contract them in the original contract.
rule, standard, or practice was enacted for legitimate business reasons; Charter challenge: A legal proceeding that alleges that government
it requires that the employer prove that it cannot accommodate the action contravenes the Canadian Charter of Rights and Freedoms.
complainant’s needs without causing itself undue hardship.
chief negotiator: The lead spokesperson representing a party in
breach of contract: Occurs when a party to a contract violates one or negotiations.
more terms of a legally binding contract.
civil litigation: The processes involved with lawsuits filed in court not
broader public sector: Those sectors of the economy that are funded involving criminal law statutes, such as legal actions for breach of
predominantly or exclusively through taxpayer money, and that have contract or torts.
management that is independent from the government.
class action: A lawsuit in which a group of people join together and
broader-based bargaining: A term used to describe collective bar- act as one common plaintiff on the basis that they all allege to have
gaining structures that involve a broader scope than the one suffered the identical or a similar legal wrong at the hands of the same
union – one employer – single location structure that dominates Canad- defendant. A class action must be approved by a court before it can
ian collective bargaining. proceed.
bumping rights: An entitlement found in the terms of a collective Co-operative Commonwealth Federation (CCF): A social-democrat-
agreement that permits a more senior employee to displace a junior ic Canadian political party formed in Alberta in 1932 that was suc-
employee in the case of a temporary or permanent downsizing of the ceeded by the New Democratic Party (NDP) in 1961.
workforce.
coercive drive system: A management approach to productivity,
business efficacy test: An approach used by common law judges most commonly associated with the 19th century, which sought to
to justify the implication of a contract term on the basis that the term increase worker output through fear and intimidation.
is necessary to make the contract effective.
collective agreement: A contract between an employer (or employ-
business representative or staff representative: An employee of a ers) and a trade union (or trade unions) that sets out the conditions of
union whose job is to negotiate and administer collective employment for a group of employees.
agreements.
collective bargaining: Negotiations between an association of em-
Canadian citizen: A person who meets the definition of a “citizen” in ployees (usually but not always a union) and an employer or associa-
the Canadian Citizenship Act and who therefore enjoys all the privil- tion of employers aimed at reaching a collective agreement.
eges and is subject to all the obligations of Canadian citizens in Can-
adian and international law. collective bargaining freeze: A rule found in collective bargaining
legislation that prohibits an employer from altering terms of employ-
Canadian Labour Congress (CLC): The largest federal confederation ment without the union’s consent during the period of collective
of unions in Canada, representing 3 million Canadians. Its main roles bargaining.
are to lobby governments, provide leadership on key issues, and pro-
vide training and education resources for its member unions. It holds commercial contract: A contract between two businesses, including
a national convention every three years. a business in the form of an independent contractor.
captive audience meeting: A meeting that employees are ordered common law: A system of judge-made rules originating in England
by their employer to attend to listen to the employer’s opinions on around the 12th century, and inherited by Canada as a British colony,
whether employees should or should not support unionization. that uses a precedent-based approach to case law. Earlier decisions

Glossary GL:709
dealing with similar facts or legal issues guide later decisions in an contra proferentem doctrine: A rule of contract interpretation in
attempt to create legal predictability. However, common law rules can which a judge interprets an ambiguous contract term in the manner
and often do evolve as social values change. most favourable to the party that did not draft the contract.
community of interest: A common test used by labour boards in contract: A legally binding agreement consisting of reciprocal prom-
assessing whether a proposed bargaining unit is appropriate for ises between two or more parties.
collective bargaining; it asks whether the workers share sufficient
contract modification: A change to one or more terms of the con-
commonality that grouping them together makes labour relations
tract during the term of the contract.
sense.
contract term implied “in fact”: A term implied into a contract by
company union: An employee association created with the encour-
a judge that reflects the presumed intentions of the parties.
agement or assistance of the employer and that is not independent of
the employer’s control or influence. A company union is often created contract term implied “in law”: A term implied into a contract by
as a union-avoidance strategy. a judge as a matter of the legal duty that the judge believes ought to
be imposed due to the nature of the particular type of contract.
comparability principle: The principle that interest arbitrators
should maintain comparable terms and conditions (e.g., pay) between contracting out: A practice whereby an employer contracts work
comparable jobs in the public and private sectors. formerly performed by its own employees to a third-party business.
comparator: In pay equity, the male job class to which a female job contributory negligence: Negligence of an injured party that con-
class is compared and found to be of equal or comparable value. tributes to the loss suffered or damage incurred due to the negligence
of another party.
compensatory damages: Damages that compensate the innocent
party for the direct loss of benefits they would have earned had the core labour standards: A set of eight ILO Conventions covering sub-
contract not been violated by the guilty party. jects considered to be critically important to the mission of the ILO. These
subjects include freedom of association, abolition of forced labour, abo-
complaint-based model: A statutory model that depends on people
lition of child labour, and non-discrimination in employment.
filing complaints alleging that their legal rights have been violated,
which initiates a government-led investigation into whether there has craft union: A union that organizes workers according to their par-
been a violation of the statute. ticular skill or trade (such as bricklayers and carpenters) rather than
according to their industry. Craft unions first emerged in Canada in the
complaint-based statutes: Statutes that are enforced entirely or early to mid-19th century. See also industrial union.
predominantly by means of individual complaints of statutory viola-
tions filed by victims. critical reformist perspective: A view of the law of work that sup-
ports both collective bargaining and regulatory standards, but empha-
conciliation: A form of mediation in which a neutral collective bar- sizes how both have tended to fail the most vulnerable workers. This
gaining expert attempts to assist an employee association (e.g., a perspective focuses on how laws can be reformed to better protect
union) and an employer or employer association in reaching a collec- these workers.
tive agreement.
cross-examination testimony: Evidence given by a witness during
condonation: When a party that could have treated the employment questioning by the party that did not call that witness.
contract as having been repudiated (terminated) by the other party’s
breach of the contract elects not to treat the contract as being Crown: The Crown in Canada is Her Majesty in right of Canada or in
repudiated. rigt of a province. The Crown is a synonym for the government.
confidential employee exclusion: A common exclusion from the Crown corporation: A corporation wholly and directly owned by the
definition of “employee” in collective bargaining legislation that has provincial or federal Crown.
the effect of excluding employees who exercise confidential labour
culminating incident: The final breach of contract by an employee
relations - related functions from the protected rights to collective
following progressive discipline that the employer relies on to justify
bargaining made available to other employees by that legislation.
termination of an employee for cause.
Congress of Industrial Organizations (CIO): A labour organization
cumulative effect constructive dismissal: A constructive dismissal
founded in the United States in 1935 that advocated for industrial
that is founded on an accumulation of breaches of the employment
unionism, in contrast to its rival organization, the American Federation
contract by the employer, none of which alone would be serious
of Labour, which at that time promoted craft unionism. The CIO played
enough to constitute a constructive dismissal.
a prominent role in organizing Canadian industrial workers during the
late 1930s and 1940s. cumulative just cause: Grounds for summary dismissal based on an
accumulation of wrongful acts by an employee over a period of time.
conspiracy to injure: A tort that involves two or more people acting
in combination with the intention of causing harm to another party damages: An amount of money a party guilty of a contract or tort
and actually causing that harm. violation is ordered to pay the innocent party to compensate the per-
son for the harm incurred.
constructive dismissal: A fundamental change to an employment
contract by an employer that an employee may treat as an effective deceit: A tort in which party A makes a false statement with the in-
termination of the contract. tention of misleading party B; party B relies on the false statement and,

GL:710 Glossary
as a result, party B suffers a loss. Damages can be recovered for that altering schedules, rules, or work patterns or changing the physical
loss. design of a workplace.
decertification: The legal process through which unionized workers duty to mitigate: A legal obligation on the victim of a breach of
remove their union as their legal representative and transition from contract by the other party to make reasonable efforts to limit the
the collective bargaining regime to the common law regime. amount of damages suffered as a consequence of the breach.
decertification petition: A form, signed by employees who no duty to warn: A requirement in both the common law and collective
longer desire to be represented by a union, that is used as evidence of bargaining law regimes for employers to warn employees that their
employee support in an application to terminate the representational behaviour or performance is unacceptable and to give them a reason-
rights of a union. able opportunity to correct their performance.
defamation: A tort that involves false statements about a person economic globalization: A term used to describe a confluence of
that tend to harm the person’s reputation; written defamation state- factors that enable and promote global integration, including (1) trade
ments are called libel, and spoken defamation statements are called agreements that dismantle trade tariffs; (2) new information technolo-
slander. gies that enable instantaneous supply chain coordination across vast
geographical spaces; and (3) improved transportation and tracking
default contract clause: A term that must be included in a contract
systems that facilitate efficient global supply chain systems.
(including a collective agreement) unless the contracting parties agree
otherwise. economic threat: A comment or action intended to signal that eco-
nomic harm (including job loss or other loss of a work-related benefit)
demotion: A reassignment of an employee’s position by an employer
will result unless a specific course of conduct is taken.
to another position with lower pay, less prestige, or less responsibility.
economic tort: A species of tort invented by British judges in the 20th
dependent contractor: A worker whose status falls in between that
century to restrain collective worker action that is intended to cause
of an employee and an independent contractor. This worker has more
economic harm.
autonomy and independence than a typical employee, yet remains
economically dependent on one customer for income and is subject economic unionism: A union philosophy that emphasizes immedi-
to considerable control at the hands of that customer. ate economic concerns of union members, including better wages and
direct discrimination: A type of discrimination in which a rule, stan- benefits.
dard, or practice distinguishes an individual or group based on a per- efficient breach: A deliberate violation of a contract or government
sonal characteristic, such as separate pay scales for men and women statute owing to the belief that it is more economically efficient to vio-
or the practice of hiring people of only one gender or one skin late the legal rule than to comply with it.
colour.
employee: A worker who is in a position of subordination to an em-
direct testimony: Evidence given by a witness called by the party ployer and subject to rules set out in an employment contract.
doing the questioning. Leading questions are usually not permitted.
employer grievance: A grievance filed by an employer alleging that
disciplinary demotion: A form of discipline in which an employee is an employee or the union has violated the collective agreement.
transferred to a position of less prestige, responsibility, or pay.
employment contract: A contract between an employer and an in-
distinguish: To explain how a prior legal decision dealt with facts or
dividual employee that defines the conditions under which the em-
legal issues that are different from the facts or issues in the current
ployee will provide labour to the employer in exchange for a monetary
case.
benefit (wages, salary), and sometimes other benefits (e.g., health
due care: The conduct a reasonable person would exercise in a situ- benefits). An employment contract may be written or oral.
ation to protect the health and safety of another.
employment equity: A legal model or remedial order that creates a
due diligence defence: A defence sometimes available to a party positive obligation on an employer to redress historical discrimination
accused of violating a statute (such as occupational health and safety by giving preference in hiring to designated groups, such as women,
legislation) that requires demonstrating the party took all reasonable visible minorities, Indigenous peoples, or people with disabilities.
precautions in the circumstances to avoid the harm or wrong that
employment: An organizational form through which a person (em-
occurred.
ployee) sells their labour power to a buyer of labour (employer) in ex-
duty of care: A special close relationship between two parties that change for value and in which the relationship is governed by an
creates an obligation in tort law to take reasonable steps to avoid employment contract.
harming the other party.
enumerated grounds: The personal characteristics that are expressly
duty of fair representation: A legal obligation imposed on unions listed in section 15(1) of the Canadian Charter of Rights and Freedoms,
to represent employees who fall within the scope of their representa- namely race, national or ethnic origin, colour, religion, sex, age, or
tion rights in a manner that is not arbitrary, discriminatory, or in bad mental or physical disability.
faith.
equal pay for equal work (EPEW): A statutory model that requires
duty to accommodate: A legal requirement in human rights law to equal pay for men and women who perform “substantially similar
take steps to remove discriminatory barriers to employment, including work” in the same establishment.

Glossary GL:711
equal pay laws: Laws or rules that require employers to pay women fixed-task contract: A contract to perform a defined task that comes
the same wage rate as men for “equal work” (which usually means “the to an end when the task is complete.
same job”).
fixed-term contract: A contract with a specific defined end date.
equilibrium wage rate: A theoretical wage rate fixed through mar-
ket forces in which the supply of labour (the number of hours workers forbearance: A promise by one party in a contract to another party
are prepared to work) equals the demand for labour (the number of to refrain from exercising a contractual right for a period of time. A
hours purchasers of labour wish to buy). forbearance by an employer to not exercise the contractual right to
terminate the employment contract may constitute consideration
essential services: Services that are essential to protect the health, flowing to an employee.
safety, or security of the public. For example, police officers,
firefighters, and medical practitioners perform essential services. Some forced resignation: When an employer puts pressure (directly or in-
governments consider services that are important to the public, such directly) on an employee to resign or face being fired.
as public transit or mail delivery, as essential services as well. Fordism: Refers to the era between the 1920s and 1960s, character-
essential services agreement: An agreement between an employer ized by industrial mass production by semi-skilled unionized male
and a union that identifies which and how many employees are “essen- workers with relatively secure jobs within large, vertically integrated
tial” to protect public safety and therefore cannot participate in a work companies. The term is derived from American industrialist and auto-
stoppage. maker Henry Ford.
exclusivity: A principle of the Wagner model, it asserts that the union forum shopping: The practice whereby a litigant attempts to litigate
chosen to represent workers becomes the sole or exclusive legal rep- the same legal issue or the same facts in multiple legal forums to find
resentative for that group of workers. the most favourable outcome.
exit and voice: Two options workers have when confronted with an fraudulent misrepresentation: A common law action based in con-
unfavourable employment condition: they can either quit (exit) their tract law in which party A knowingly makes a false statement with the
job or stay and protest (voice) to effect workplace change. intention to mislead party B, and that statement induces party B to
enter into a contract. In that case, party B may be able to rescind the
expedited arbitration: A form of labour arbitration with strict time contract and seek damages for any loss suffered.
deadlines intended to ensure the parties can receive a decision
expeditiously. free trade: A term used to describe a trade law policy characterized
by low or zero trade tariffs and low or zero quotas on the amount of
experience rating program: Programs that adjust employer’s workers’ goods that flow between national borders.
compensation premiums based on the employer’s claims record. Ex-
perience rating programs incentivize employers to improve safety but frustration of contract: The termination of a contract caused by an
also create an incentive for them to attempt to suppress or resist claims, unforeseen event that renders performance of the contract
since claims may lead to higher experience rating assessments. impossible.
expert administrative tribunals: Decision-making bodies created gang bosses: Workers employed to supervise the increasingly indus-
by a government statute and given responsibility for interpreting and trializing workforce in the late 19th century. They had almost total
enforcing one or more statutes and any regulations pursuant to that control over the workers they supervised. Often they were paid based
statute. on the productivity of their workers. Thus, the discipline they adminis-
tered was often harsh and arbitrary.
expressed contract terms: Terms of a contract that the parties have
explicitly agreed to, either orally or in writing. gender neutral job evaluation system: A job evaluation system
used in pay equity assessments that measures a job’s skill, effort, re-
feedback loop: An explanatory device that demonstrates how out- sponsibility, and working conditions and that is free of explicit and
comes produced by a system (e.g., legal rules produced by a legal systemic gender discrimination.
system) can influence other systems (e.g., the economic system) and
also “feed back” into the original system as information in a process of gender wage gap: The difference in earnings between males and
perpetual learning, experience, and change. females.
final offer selection: A form of interest arbitration in which the inter- general strike: A strike that includes a large number of all workers in
est arbitrator is restricted to imposing either the employer’s or the a given geographical region and across many industries. A general
union’s proposed collective agreement in its entirety. strike is distinct from a local strike, in which workers in a particular
bargaining unit strike during the course of negotiating a collective
final offer vote: A provision found in collective bargaining legislation agreement.
that entitles an employer to have the last offer it presented to the
union’s negotiating team put to a ballot of employees. Employers can gig economy: An economic arrangement characterized by an ex-
only exercise this right once per round of bargaining. change of labour for money that is facilitated by an app or electronic
platform that connects customers to workers.
first contract arbitration: A statutory provision that refers a collec-
tive bargaining impasse during negotiations for a first collective agree- Gini coefficient: A statistical measure of economic inequality that
ment to interest arbitration. Conditions for accessing first contract measures the extent to which income distribution among individuals
arbitration vary by jurisdiction. or households within a population deviates from a perfectly equal

GL:712 Glossary
distribution. The higher the number over 0, the higher the inequality. incrementalism principle: The principle that interest arbitrators
In a population with a Gini score of 0.0, everyone earns the same should not impose significant changes on the parties to a collective
amount. In a population with a score of 1.0, one person earns all the agreement, and should instead reserve those big changes for freely
income. negotiated agreements.
government bill: A bill introduced by a minister of the elected indefinite-term contract: A contract that has no specified end date.
government.
indenture: A contractual arrangement in which a person is legally
grievance: A formal complaint lodged under a collective agreement bound to serve another for a period of time.
that alleges a contravention of the collective agreement.
independent contractor: A worker who is in business for himself or
grievance procedure: A provision of the collective agreement that herself and who, therefore, is not an employee.
explains when and how a grievance alleging a breach of the agree- independent union: A union that is at arm’s length and independent
ment can be filed and what process will be used to mediate the griev- from the control of any employer.
ance and, if not resolved, to refer the grievance to binding labour
arbitration. A grievance procedure usually includes several “steps,” with indirect discrimination: A type of discrimination in which a rule,
the final step being referral to arbitration. standard, or practice treats everyone the same on its face, yet has an ad-
verse impact on some people because of a personal characteristic.
grievor: An employee who files a grievance.
individual grievance: A grievance filed by an individual employee
gross incompetence: A level of employee performance that falls far alleging their collective agreement rights have been violated by the
below that expected of a reasonably competent employee. employer.
group grievance: A grievance filed on behalf of two or more employ- inducement: A factor considered in assessing the length of reason-
ees who allege the same or a similar breach of the collective able notice that should be awarded to an employee whose employ-
agreement. ment contract is terminated by employer A after employer A
encouraged or enticed the employee to quit a prior job with company
hard bargaining: A lawful strategy in collective bargaining that in-
B to come to work for employer A.
volves a party using its superior bargaining power to insist upon col-
lective agreement terms that favour its own interests. inducing breach of contract: A tort that involves wrongful acts by a
third party that are intended to cause a breach of contract between
hearsay evidence: Evidence given by a person based on second-
two other parties.
hand knowledge rather than their own direct knowledge or
observations. industrial pluralist perspective: A view of the law of work that
emphasizes the inequality of bargaining power between employers
hiring order: An order issued by a human rights tribunal or court
and employees and advocates especially for collective bargaining and
requiring an employer to offer employment to a person previously
unions as a means of empowering workers so that they can bargain
denied employment for discriminatory reasons.
fairer employment outcomes.
human rights commission: An organization created by a govern- industrial union: An organizing ethos in which all workers in a given
ment to investigate human rights complaints and promote human industry are organized into the same union, regardless of their particu-
rights compliance through education, public outreach, and training. lar skill or job category. See also craft union.
human rights tribunal: An expert administrative tribunal created by Industrial Workers of the World (IWW): A labour organization
a government to hear and decide human rights complaints and inter- founded in 1905 in Chicago and particularly active in western Canada
pret and apply human rights statutes. during the early 20th century that advocates for all workers to join
ILO Convention: An international treaty adopted by the International together, including the unemployed, and to engage in general strikes
Labour Organization that is subject to ratification by member countries. to resist and ultimately replace capitalism with a more worker-con-
trolled system. The IWW still exists.
ILO recommendations: Non-binding guidelines introduced by the
infant: A person under the age of 18; also referred to as a minor in
International Labour Organization that provide guidance to member
legal writing.
countries but are not subject to ratification.
injunction: A legal order issued by a judge prohibiting a person from
implied contract term: A default contract term invented by common
engaging in a particular course of action, such as breaching a contract,
law judges and read into an employment contract when the written
committing a tort, or violating a statute.
terms of the contract (if any) do not address the specific issue ad-
dressed by the implied term. innocent absenteeism: An employee’s absence from work due to
reasons that are not blameworthy, such as illness, disability, or reli-
income inequality: A measure of the extent to which income in a
gious observance.
country is unevenly distributed.
inside union organizer: An employee who assists in efforts to union-
incompetence: Poor work performance by an employee that is non- ize their own employer.
culpable and not due to any deliberate malfeasance by the employee,
but to an inability to perform the job to a reasonable standard of insolence: An overt expression of defiance by an employee to the
competence. authority of the employer.

Glossary GL:713
insubordination: A breach by an employee of the implied or ex- justice of the peace: In the 19th century, a local nobleman or gentle-
pressed term of an employment contract requiring the employee to man appointed to represent the Crown in a particular locality and
obey an employer’s orders and instructions. empowered by statutes to resolve different types of legal matters; also
known as a magistrate.
intentional infliction of mental suffering: A tort in which a person
or employer engages in outrageous harmful conduct toward another justification: A defence to a defamation lawsuit based on the claim
with the intention to cause harm that actually occurs. that the comments are “substantially true.”
interest arbitration: An arbitration process in which a neutral arbi- Knights of Labor: An organization formed in the United States in
trator (or arbitration board) imposes a final collective agreement after 1869 and that was active in Canada between about 1875 and the early
the parties were unable to reach an agreement in negotiations. 1900s. The Knights promoted “industrial unionism,” the organization of
all workers regardless of skill, gender, race, or religion.
interest arbitrator: An individual or three-person expert arbitration
board tasked with writing the terms of a collective agreement when labour arbitration: A binding dispute resolution process used to re-
the union and employer are unable to reach agreement through vol- solve disputes involving alleged breaches of collective agreements.
untary collective bargaining.
labour arbitrator: An individual or three-person expert arbitration
interim reinstatement: An order by a labour board (or other legal panel appointed to decide disputes over the application and interpret-
board possessing such authority) that the employer reinstate a termination of collective agreements.
ated employee to their job pending the outcome of litigation that will
labour cooperation agreement (LCA): An agreement between na-
determine if the employer was within its legal rights to terminate the
tions, often appended to a trade agreement, that imposes obligations
employee.
on nations to work toward improving labour standards within their
interlocutory injunction: A temporary court order prohibiting con- borders.
duct that is potentially unlawful until a decision is released by the court labour injunction: An order issued by a judge that prohibits or re-
on whether the conduct is unlawful. stricts a union and unionized workers from engaging in some type of
internal responsibility system (IRS): A system of shared responsibil- collective action, such as a strike or picketing.
ity between employers and workers for workplace health and safety. Labour Market Impact Assessment (LMIA): An assessment of
international unions: A union that represents workers in more than labour market conditions conducted by the federal government
one country. whose purpose is to determine whether an absence of Canadian work-
ers to fill a vacancy justifies issuing a temporary work permit to a for-
intimidation: A tort that involves an attempt to coerce another per- eign national.
son to do something or to refrain from doing something they are en-
titled to do by the threat of an unlawful act. labour movement: A general term for the collective organization of
working people and their organizations that evolved to campaign for
issue estoppel: A legal principle that prohibits a party from acting in improved terms and conditions at work and to contest and challenge
a manner or taking a position that is contrary to a position that party various aspects of advanced capitalist society, particularly with regard
has made in the past and that has been relied on by the other party. to social relations of work.
joint health and safety committee (JHSC): A committee comprising labour relations boards: Expert administrative tribunals responsible
employer and worker representatives mandated by occupational for enforcing and interpreting labour relations legislation.
health and safety legislation to consult, investigate, and make recom-
landed immigrant: See permanent resident.
mendations relating to health and safety issues in a workplace.
last chance agreement: A type of settlement of a grievance challeng-
journeyman: A worker who has completed an official apprenticeship
ing the termination of an employee that includes reinstatement of the
in a craft or skill and who is thus qualified to work in that field, under
employee subject to a condition that if the employee reoffends, then
the supervision of a master craftsman.
termination will be the consequence.
judicial review: The process through which a decision of an expert
lateral transfer: A reassignment of an employee’s position to another
administrative tribunal is appealed to a court on the basis that the
position that is roughly equal in terms of pay, prestige, and
tribunal exceeded its authority (or jurisdiction) as defined in the stat-
responsibility.
ute that created it or that the tribunal’s decision was wrong. How much
deference a court must give to the expert tribunal’s decision is a com- layoff: A non-disciplinary suspension imposed by an employer of
plex question that is considered in a field of law known as administra- the employee’s right to come to work, usually due to a lack of avail-
tive law. able work.
jurisdiction: The scope of authority over which a government, court, legislation: Laws enacted by governments, including both statutes
or expert administrative power has the power to govern. and regulations.
just cause provision: A term in a collective agreement between a living wage: Different measures exist but, in general, it is a measure
union and an employer that requires the employer demonstrate “just of the wage level that would be necessary to enable a full-time em-
cause,” or a good business reason, to discipline or dismiss an ployee to earn enough money to meet basic needs, such as food,
employee. clothing, child care, and shelter.

GL:714 Glossary
local union: A local branch of a union; it is part of and chartered by a agreement (every bargaining unit employee) become a member of the
parent union. union that negotiated the collective agreement.
local union president: A person who leads a subunit of a union, master and servant law: A body of legislation and related case law
known as a local union. A local union may represent a single workplace that regulated the work of servants, agricultural workers, and skilled
or a group of workplaces within a defined geographical area or sector. craft workers in England between the 14th and 19th centuries, and
Local union presidents are usually elected by union members and are which was primarily interpreted and applied by local justices of the
(or were) employees of a unionized employer. peace and magistrates.
lockout: A tactic whereby an employer refuses to permit employees master craftsman: A craftsworker who has attained the highest level
to report to work and to pay the employees to apply pressure on the of aptitude.
employees and their union in collective bargaining.
maternity leave: A statutory rule requiring an employer to grant a
magistrate: See justice of the peace. pregnant woman time off from work without pay in the weeks im-
mediately before or after giving birth (also known as pregnancy leave).
majoritarianism: A principle of the Wagner model, it asserts that a
union must secure the support of a majority of employees to win the mediation-arbitration (“med-arb”): A method of interest arbitration
right to act as their representative. in which the arbitrator acts firstly as a mediator to try to help the par-
ties reach an agreement, failing which the arbitrator issues a binding
managerial exclusion: A common exclusion from the definition of
decision resolving the dispute.
“employee” in collective bargaining legislation that has the effect of
excluding employees who exercise managerial functions from the mitigating circumstances/factors: Personal or workplace-related
protected rights to collective bargaining made available to other em- factors that, while not directly the cause of an employee’s behaviour,
ployees by that legislation. help explain or justify an employee’s behaviour.
managerialist perspective: A view of the law of work guided by the monetary issues: Subjects in collective bargaining that impose direct
belief that employers have an economic incentive to treat employees costs on employers, such as wages, benefits, and pensions.
decently and fairly in order to extract commitment and effort. Govern-
ment legislation of employment should be kept at a minimum. Union- multilateral trade agreement: A trade agreement between more
ization is a response to poor management and is disruptive. than two nations.
mandatory arbitration clause: A clause in a collective agreement mutable: A condition that is liable to change.
that requires all disputes arising under the collective agreement to be
necessity principle: The principle that interest arbitrators should
referred to binding labour arbitration to be resolved.
order the terms (e.g., wages and other benefits) necessary to attract
mandatory ceiling: A law that establishes a mandatory maximum and retain employees for the employer.
condition that can be included in a contract; for example, a law that
negligence: A tort that involves a non-intentional, careless, or reck-
fixes the maximum number of hours an employee can work in a day or
less act that breaches a legally recognized duty of care and results in
week.
damage to another person.
mandatory certification vote: A method used in Canadian collective
negligent hiring: A claim made by an injured party against an em-
bargaining legislation to measure the level of employee support for
ployer or job recruiter stating that reasonable steps were not taken to
unionization that involves the government conducting a secret ballot
investigate the background of an employee who caused harm.
vote of bargaining unit employees.
negligent misrepresentation: A tort in which party A, owing a duty
mandatory collective agreement term: A term required by statute
of care, makes an untrue statement to party B without sufficient care
to be included in every collective agreement. If no such term is in-
as to the statement’s accuracy, which party B then relies upon and
cluded, the statute reads a term into the agreement.
suffers loss as a result.
mandatory floor: A law that establishes a mandatory minimum con-
negotiation: Discussion between two or more people aimed at
dition that can be included in a contract; for example, a minimum
reaching an agreement.
wage law.
neoclassical perspective: An economics-based view of the law of
mandatory interest arbitration: Statutorily required interest arbitra-
work based on the ideal of a perfectly competitive labour market. It
tion to resolve collective bargaining impasses. Replaces the right to
rejects government intervention in labour markets and collective
strike and lockout.
bargaining and argues that employers and individual employees
mandatory retirement: A legal rule in a statute or contract that ter- should set working conditions under a system of freedom of
minates an employment contract upon the employee reaching a contract.
specified age.
nepotism defence: A provision found in some human rights statutes
mandatory time off: A provision in employment standards legisla- that permits an employer to discriminate against workers on the basis
tion requiring that employees be given a specified amount of time off of family status or marital status.
work in a day or week.
Nine-Hour Leagues: Organizations active in the late 19th century
mandatory union membership clause: A clause in a collective that attempted to pressure and persuade employers and governments
agreement that requires that every employee covered by the collective to implement a mandatory maximum nine-hour workday.

Glossary GL:715
Nine-Hour Movement: A social movement peaking in the early ting them to work for any employer in Canada. This permit does not
1870s seeking a legislated maximum nine-hour workday. require a Labour Market Impact Assessment.
non-monetary issues: Subjects in collective bargaining that relate to overtime pay: A premium above the normal wage rate of an em-
contract language, such as the text of a grievance procedure or man- ployee that must be paid for every hour worked above the threshold
agement rights clause. of standard working hours. The premium is usually 1.5 times the nor-
mal wage rate, but sometimes it is higher than that.
non-motive unfair labour practice: A type of unfair labour practice
that does not require the presence of anti-union animus. own account self-employed workers: Independent contractors who
have no employees.
non-pecuniary damages: Damages awarded in a tort for losses that
are intangible or non-financial in nature, such as hurt feelings, emo- pardon: A legal order that removes a person’s record of a criminal
tional distress, or loss of enjoyment of life. conviction from their formal criminal convictions file. It may be grant-
ed by the federal government if the person has served their sentence
notice of termination clause: A clause in an employment contract
and demonstrated good behaviour in society for a period of time. A
that specifies how much notice is required to be given to the other
pardon is now known as a “record suspension.”
party in order to lawfully terminate the contract.
parent union: A larger umbrella organization made up of smaller
notice to bargain: A letter from a union or employer to the other
local unions. It provides service to its member local unions, such as
party that formally begins the process of collective bargaining.
training of local union representatives, maintaining strike funds, and
nuisance: A tort in which the activities of one person unreasonably providing collective bargaining support and legal expertise.
interfere with the use or enjoyment of the property of another
parental benefits: A rule in employment insurance legislation that
person.
entitles new parents to receive benefits (financial assistance) while
Oakes test: The test applied by courts and tribunals when interpret- caring for a newborn or newly adopted child.
ing section 1 of the Canadian Charter of Rights and Freedoms. The test
parental leave: A statutory rule that requires an employer to grant
requires courts and tribunals to balance the interests of individuals in
the parents of a newborn or newly adopted child a period of time off
having their Charter rights and freedoms protected against any broad-
work without pay to care for the child.
er social benefits that would result from allowing a restriction of a
Charter right or freedom. Named after the case R v. Oakes, the test was parish: A unit of local government coinciding (in England) with the
formulated by the Supreme Court of Canada. Church of England’s geographical areas.
objective test: A legal test used in interpretation of contracts and parol evidence rule: A common law rule of evidence in which a judge
statutes that asks, “What would a reasonable person of normal intelli- is prohibited from hearing evidence that the parties intended a mean-
gence think, if told about the circumstances?” Contrast with subjective ing different than what is indicated in the clear language of the written
test. contract.
occupational crowding: A term used to describe the segregation of passing off: A tort that involves deceiving consumers into believing
women and men into different types of jobs. It is usually used to ex- that the good, service, or business of one company or person is really
plain how women tend to be much more highly represented in lower- that of another, thereby misrepresenting the source.
paying jobs (e.g., retail, sales, and other service jobs; clerical work; and
pay equity: A statutory model designed to address systemic gender
child care) than are men.
wage discrimination by comparing lower-paying female-dominated
occupational exposure limits (OELs): The concentration of a hazard- job classes to higher-paying male-dominated job classes when the
ous material that a worker may normally be exposed to without caus- total score is the same or substantially the same in an evaluation of the
ing harm. skill, effort, responsibility, and working conditions of the two job
classes.
officious bystander test: An approach used by common law judges
to justify the implication of a contract term based on the presumed PC 1003: Federal legislation that granted workers collective bargain-
intention of the parties. The idea is that a contract term is implied if it ing rights, including protection from anti-union discrimination by
would be obvious to an uninterested bystander that both parties in- employers and a limited protected right to strike, and imposed on
tended the term to be part of the contract. employers a legal “duty to bargain” with unions representing a majority
of workers.
One Big Union (OBU): A labour organization active primarily in west-
ern Canada between 1919 and the early 1920s that argued for workers pecuniary damages: Damages awarded in a tort case that are
to unite into a single union that could challenge the capitalist order uantifiable in monetary terms (i.e., financial losses such as med-
q
through activism. OBU existed in some form until it formally merged ical bills, lost wages, loss of future earnings, costs of future medical
with the Canadian Labour Congress in 1956. care).
open period: A period of time defined in a collective bargaining penal sanctions: State punishment imposed through criminal law,
statute during which a union may apply to displace another union as usually referring to incarceration.
the representative of a group of employees, or during which unionized
employees may file an application to “de-certify” the union. permanent resident: An immigration status under Canadian immi-
gration law that grants a person of foreign origin many but not all
open work permit: A legal authorization issued by the Canadian rights available to Canadian citizens. For example, a permanent resi-
government to a foreign national who meets certain criteria permit- dent’s voting rights are restricted.

GL:716 Glossary
permissible wage difference: An explanation for a wage difference jurisdictions, such as a law that imposes import tariffs on goods manu-
between a male and female job class that is accepted as valid and non- factured in other countries.
discriminatory in a pay equity statute.
protective standards regulation: Government regulation designed
picketing: A form of protest usually associated with a labour strike, primarily to protect employees by imposing mandatory standards,
wherein striking workers congregate outside an establishment, usually such as minimum contract requirements and safety rules.
their place of work, to draw attention to their situation, to dissuade
public policy illegality: A common law right of judges to void all or
others from “scabbing,” and to provide mutual solidarity and support.
part of a contract because it is contrary to public policy.
piecework pay: Wages calculated based on the number of pieces
public servant: An employee formally appointed to the public ser-
produced by an employee.
vice following the requirements of legislation.
policy grievance: A grievance filed by a union that raises an issue (or
public service: The public service comprises those departments and
issues) that is of general interest to all or many employees in the bar-
agencies that are controlled and managed directly by a central finan-
gaining unit.
cial planning agency of the Crown. It is distinct from the public sector,
precarious work: Work that is defined by characteristics such as job which receives funding from the government but is responsible for its
insecurity; short job tenure; low pay; few benefits; low collective own management.
bargaining coverage; and sporadic, limited, or unpredictable work hours.
punitive damages: Damages ordered against a party who engages
precarious worker: A worker whose labour market participation is in outrageous or egregious behaviour deserving of special denuncia-
characterized by low pay, job insecurity, lack of job tenure, or multiple tion and retribution.
part-time or temporary jobs.
purposive approach to statutory interpretation: An approach to
precedent: An earlier decision by a judge that dealt with the same, or interpreting and applying a statutory provision that is guided by the
very similar, facts and legal issues as those before a judge in the current purpose of the provision.
case.
qualified privilege: A defence to a defamation lawsuit based on the
prima facie case of discrimination: In human rights law, when a claim that public policy supports frank and honest opinions in the
complainant provides sufficient evidence that they have been the circumstances, and the comments are made without malice.
victim of discrimination on a ground prohibited in a human rights quantum meruit: An entitlement to be paid a fair market rate for work
statute, which shifts the burden to the employer to establish that no performed when the amount is not stipulated in a contract.
unlawful discrimination occurred.
racial wage gap: The difference in earnings between the dominant
primary picketing: Picketing that takes place at the location of the racial group in a society and racialized groups.
employer directly involved in the labour dispute.
radical perspective: A view of the law of work inspired by Karl
principle of proportionality: The test applied by the courts in sum- Marx’s insights and criticisms of the capitalist system. It considers regu-
mary dismissal cases that assesses whether the termination of an latory standards regulation and collective bargaining to be helpful but
employee’s contract without notice is an appropriate response to the limited in their ability to respond to the exploitive nature of capitalism.
employee’s misconduct, considering all of the relevant facts. This perspective advocates for a more fundamental transformation of
private member’s bill: A bill introduced by an elected politician who the economic model.
is not a minister. Rand Formula: Refers to the practice in unionized workplaces of re-
probationary period: A period of time at the beginning of an em- quiring automatic union dues check-off of all workers covered by the
ployment contract during which the employer evaluates an employ- terms of a collective agreement, regardless of their union membership
ee’s suitability for further employment. status.
professional negligence: The special application of the tort of neg- ratification (of a collective agreement): A vote by unionized em-
ligence to professionals, such as doctors, lawyers, and engineers. ployees in favour of accepting a proposed collective agreement.
progressive discipline: The application in stages by employers of ratify: A term used to describe the process in which a national
progressively more serious discipline to correct performance government endorses and agrees to implement into its legal system
problems. the requirements of an international legal convention or other legal
instrument.
prohibited grounds of discrimination: Personal characteristics that
are protected from discrimination in human rights statutes, including reasonable contemplation test: The test of contract damage “re-
but not limited to sex, age, race, skin colour, and religion. moteness” from the 1854 case of Hadley v. Baxendale. It provides that
damages for breach of contract are available only for harms that the
promotion: A reassignment of an employee’s position by an em- parties would reasonably have contemplated at the time the contract
ployer to another position with higher pay, more prestige, and more was formed.
responsibility.
reception: When the British Empire established a colony, it often
protectionist trade law: A law that favours domestic goods or ser- passed a statute that specified that the law of the colony was the statu-
vices over goods and services offered by providers located in other tory and common law in force on that date in England.

Glossary GL:717
recognition strike: A strike by workers with the aim of pressuring an restraint of trade: An English common law doctrine dating from the
employer to recognize and bargain with a union on behalf of the 1400s, which states that action or contracts that restrain trade are
employees. presumptively non-enforceable or illegal.
regulations: Government-made detailed rules introduced as a sup- restrictive covenant: A contract term that restricts the right of a
plement to, and pursuant to authority created in, a statute. For ex- former employee to engage in certain competitive practices against
ample, the Ontario Employment Standards Act, 2000 requires that their former employer.
employers pay at least “the prescribed minimum wage,” but does not
say what that wage rate is. That act gives the government the right to right to know: Under the IRS, workers have a right to know about the
introduce regulations (in s. 141), and one regulation (O. Reg. 285/01) hazards they are exposed to in the workplace.
sets out the precise amount of the minimum wage.
right to participate: Under the IRS, workers have a right to be a part
reinstatement: A legal remedy issued by a court of administrative of the process of identifying and resolving health and safety issues.
tribunal (including an arbitrator) ordering an employer to re-employ This right is often exercised through joint health and safety
an employee it had terminated in violation of a contract of service. committees.
related employers: Two or more companies ruled by a labour rela- right to refuse unsafe work: Under the IRS, workers have a right to
tions board to be carrying out associated or related activities under refuse to perform work they believe to be unsafe, pending the out-
common direction and control and, therefore, to be a single employer come of an investigation.
for collective bargaining purposes.
rotating strike: A form of strike in which some or all workers sporadi-
relief camps: Camps created by the federal government during the cally engage in some form of strike action. For example, workers might
Depression years of the early 1930s to house single, unemployed strike on Tuesday but report to work the rest of the week, or groups of
males. In exchange for room and board, the men were assigned phys- workers may strike while others do not.
ically demanding work under harsh working conditions.
royal assent: A largely symbolic process through which the English
remedial certification: An order by a labour relations board certify- sovereign (the “Crown”) or their representative formally approves of a
ing a union that may not have established that it has majority em- new law passed by a Canadian Parliament.
ployee support as a remedy for seriously unlawful acts by the
employer—such as convincing employees that supporting a union scab: A term used to refer to a worker who would otherwise be on
could cost them their jobs. strike, but who refuses to strike and instead crosses the picket line.
Sometimes “scab” is used to refer generally to any person who crosses
remedy: The means by which a court or tribunal enforces its decision, a picket line to perform work normally done by workers on strike. See
such as by ordering the guilty party to pay monetary damages or take also replacement worker.
such further action the court deems appropriate to compensate vic-
tims for loss or deter future wrongful conduct. secondary picketing: Picketing in a labour dispute that takes place
at a location other than the workplace where the workers engaged in
replacement worker: A person who is employed to take the place of
the dispute are employed.
another worker who is on strike or locked out. See also scab.
self-induced frustration: When the actions of the employer or em-
replication principle: The principle that, since interest arbitration is
ployee make it impossible for the contract as originally envisioned to
a substitute for free collective bargaining, the interest arbitrator should
be performed. The courts have refused to apply the doctrine of frustra-
seek to replicate, to the extent possible, an agreement that the parties
tion to self-induced frustration.
would have likely reached had they had recourse to the economic
sanctions of a strike or lockout. seniority: A measure of an employee’s length of service with an
repudiation of contract: A breach of contract that demonstrates an employer.
intention by the party to treat the contract as at an end and to no
seniority provision: A clause in the collective agreement that allo-
longer be bound by the contract.
cates employment terms, such as rate of pay, promotion, and so on,
res judicata: A legal principle that prohibits a party from re-litigating based on length of time since being hired.
an issue that has already been raised in a prior proceeding.
severance pay: Compensation that an employer must pay to a quali-
rescind: To set aside a contract and put the party back into their pre- fying employee who has been dismissed; this compensation is in
contract position. addition to what is required by statutory notice obligations.
reserved management rights: An interpretive principle applied in sexual harassment: Unwanted conduct of a sexual nature that detri-
labour arbitration that presumes that unionized employers retain the mentally affects the work environment or leads to job-related conse-
basic rights to run their business as they deem fit, subject to any statu- quences for the victim.
tory or contractual restrictions bargained by the union. These rights
are sometimes called residual management rights. shock effect: A concept that describes how managers respond to
unionization, and the ability of unions to enforce rules and raise labour
resignation: When an employee terminates the employment con- costs, by professionalizing their human resource management prac-
tract by engaging in conduct that evinces a clear intention to termin- tices to reduce risk and find efficiencies and thereby improve
ate the contract. productivity.

GL:718 Glossary
signalling effect: A phrase used by courts to describe the psycho- statutory wage floor: A law that fixes a minimum wage below which
logical, perhaps unspoken, message conveyed to a person confronted an employer cannot pay an employee.
by labour picketing that the picketers desire that person to not cross
the picket line. strike: Legislation can assign a particular definition to the word strike.
In Canada, strikes are usually defined to include both (1) a collective
sincerely held belief: A legal test applied to determine whether a refusal by employees to perform work, and (2) a deliberate collective
person has a religious belief that qualifies for protection against dis- slowdown by workers designed to restrict the output of an employer
crimination on the basis of religion or creed. The test is met if the per- (commonly known as a work to rule).
son holds a sincere and deep belief that a practice (e.g., not working
on Saturdays) has a relationship—or nexus—to religion. strike pay: A payment made by a union to a union member or person
in a bargaining unit during a work stoppage, often as consideration for
social clause: A clause included in a trade agreement that would in performing a shift as a picketer.
some manner condition access to trade benefits, such as lower tariffs,
upon compliance with certain defined work law standards. subjective test: A legal test used in interpretation of contracts and
statutes that asks, “What was this person actually thinking at the time?”
social unionism: A union philosophy that emphasizes the labour Contrast with objective test.
movement’s important role in advancing democratic values, social
justice, and fair treatment of all workers. subsystem: In legal sociology, a self-contained system within the broad-
er social system that possesses its own rules, norms, and modes of com-
specific penalty clause: A term in a contract that defines the penalty munication. Examples include economic and market; legal; political;
that will result as a consequence of a specified breach of contract by social, cultural, and religious; and ecological/environmental subsystems.
one of the parties.
summary dismissal: Termination of an employment contract by an
specific performance: An order by a court requiring a party found to employer without notice to the employee in response to a serious
have breached a contract to carry out its obligations as specified in the breach of contract by the employee.
contract.
sunset clause: A clause in a collective agreement or employment
spillover effect: The effects that collective agreement settlements contract that wipes prior discipline from an employee’s record after a
bargained by unions and employers have on individual employment specified period of discipline-free work.
contracts in non-union workplaces.
supranational law: Laws that transcend national borders and have
standard employment relationship: A model of employment char- application in more than one nation.
acterized by stable, long-term job security, full-time hours, decent
benefits, and wage rates that rise steadily over time. surface bargaining: A strategy in collective bargaining that involves
a party going through the motions of bargaining but having no inten-
standard of care: In the application of the tort of negligence, the level tion of ever concluding a collective agreement. Surface bargaining is
of care expected of a party that has a legal duty of care to not harm others. a violation of the duty to bargain in good faith.
standard working hours: The number of working hours in a day or sympathy strike: A strike undertaken by workers who do not have an
week after which overtime pay is required, as defined in an employ- immediate and direct grievance against their own employer, but who
ment standards law. strike as a means of showing support and solidarity with other striking
workers who do have such a grievance with their employer.
stare decisis: A Latin term meaning “to stand by a previous decision.”
It is a guiding principle in the common law regime. systemic discrimination: Practices, behaviour, norms, or policies
within an organization that may be unintentional and unobserved yet
statute: A law, or legislation, produced by a government that includes
perpetuate disadvantages for certain individuals because of a personal
rules that regulate the conduct of business and people. An example is
attribute or characteristic (e.g., race, gender, age, disability, or
the Ontario Employment Standards Act, 2000.
religion).
statutory bar: A rule found in collective bargaining legislation that pro-
hibits an application from being filed for a defined period of time. tariff: A fee or tax imposed on goods and services as a condition of
their entering a country to be sold in that country’s markets.
statutory holiday: A day designated in employment standards legis-
lation on which employees are entitled to receive either time off with Temporary Foreign Worker Program: A federal government pro-
pay or a wage premium if they work. gram that allows Canadian employers to hire foreign nationals to ad-
dress temporary labour and skill shortages when qualified Canadian
statutory notice of termination: The requirement found in employ- citizens or permanent residents are not available.
ment standards legislation for employers (and sometimes employees)
to provide a defined amount of notice that they are terminating the termination pay: The payment owing to a dismissed employee
employment contract. under employment standards legislation that is in lieu of working
statutory notice.
statutory vacation pay: The amount of pay a vacationing employee
is legally entitled to receive while taking vacation time. three-person labour arbitration board: An arbitration panel con-
sisting of a person appointed by the employer, a person appointed by
statutory vacation time: The amount of time an employee is legally the union, and a “neutral” person, sometimes appointed by the two
entitled to take off work during a year. sides.

Glossary GL:719
time theft: When an employee falsely claims wages for time not ac- union certification: A government-issued licence that entitles a
tually worked. union to represent employees in a defined bargaining unit in their
relationship with their employer.
tipping out: The practice by some restaurant or bar employers of
collecting (and sometimes taking) a portion of servers’ tips and divid- union coverage rate: The percentage of employees whose employ-
ing the tip pool among other employees. ment conditions are governed by a collective agreement bargained on
their behalf by a union.
tort: A type of wrongful act done by one person to another (or to
another’s property) that judges have recognized as legally actionable. union density rate: The percentage of employees who are union
Examples are nuisance, trespass, negligence, and conspiracy. members.
tortfeasor: A person who commits a tort. union dues check-off: A “union security” clause whereby all members
of a bargaining unit must pay union dues and employers must “check
Trades and Labor Congress of Canada (TLC): The first federation of off” these dues from workers’ wages and remit them to the union.
labour unions formed in Canada in 1886. In 1956, the TLC merged with
the Canadian Congress of Labour (CCL) to form the Canadian Labour union membership: The number of people who are members of a
Congress. union.
Treasury Board: A committee of the Queen’s Privy Council (i.e., Cabi- union membership card: A document that indicates a worker’s de-
net) comprising the minister of finance and four other Cabinet minis- sire to join and become a member of a union.
ters. The actual work of the Treasury Board is done by its administrative union organizer: An employee of a union whose principal duties
arm—the Treasury Board Secretariat. The Treasury Board Secretariat include organizing new workplaces and building union membership.
essentially manages the public service, including its collective bargain-
ing and other human resource functions. union raid: An attempt by one union to organize workers who are
represented by another union.
trespass to property: A tort in which one person intentionally enters
another person’s property without the property owner’s permission; union recognition clause: A clause in a collective agreement that
as well, it can involve a refusal to leave a property when instructed by defines the scope of the jobs that are covered by the agreement.
the property owner to leave. union shop: A “union security” clause whereby all workers in a given
ultra vires: Beyond one’s jurisdictional powers. job classification are required to join the union. Union shops are dis-
tinct from closed shops, open shops, and agency shops.
unconscionability doctrine: A contract or contract term that a court
refuses to enforce because it is a result of inequality of bargaining union steward: A representative of a union in a workplace, often
power that was exploited by the more powerful party to obtain a elected by employees in that workplace, who is responsible for repre-
contract that is substantially unfair considering community standards senting employees in day-to-day concerns about working conditions
of commercial morality. and collective agreement administration.
union wage premium: The additional wage amount attributed to

undue fragmentation: A legal test used by labour boards to decide
union membership.
whether a proposed bargaining unit is inappropriate because it would
carve up the workplace into too many relatively small groups of work- unjust dismissal law: A statutory law that imposes restrictions on the
ers, creating practical business difficulties for the employer. contractual right of employers to dismiss employees for any reason at all.
undue hardship: The legitimate defence that an employer may raise unpaid intern: A term used to describe a person who performs work
to justify why it could not provide an accommodation to an employee. for a business or receives training by a business but who is not paid for
This standard is demanding and requires the employer to demonstrate that work.
that significant difficulties—beyond mere inconvenience—would re-
sult if it had to accommodate the employee. unpaid suspension: A temporary suspension of an employee’s
right to come to work imposed by the employer as a form of disci-
unfair labour practice: An action undertaken by either the union or pline for employee misconduct.
the employer that violates one or more articles in the relevant labour
relations legislation. variable pay: A portion of an employee’s compensation that varies
from time to time based on the employee’s or company’s performance
union authorization card: A document that indicates a worker’s or the discretion of the employer.
consent and desire to have the union identified on the card represent
vicarious liability: A legal rule under which an employer is liable for
them in collective bargaining with an employer.
damage caused to a third party by one or more of its employees.
union avoidance: A management strategy designed to reduce the
voidable contract: A contract that may be declared void at the option
risks that employees will join unions.
of one of the parties due to a deficiency. An example is an employment
union business representative: An employee of a union whose job contract involving an employee who is considered mentally impaired.
includes assisting local unions in the negotiation of collective agree- voluntary interest arbitration: A procedure in which a union and
ments and administration and enforcement of collective employer agree to refer outstanding collective bargaining issues to an
agreements. interest arbitrator to resolve.

GL:720 Glossary
voluntary recognition: An arrangement in which an employer elects work now, grieve later: A rule developed by labour arbitrators that
to recognize and bargain with a union that has not been certified by requires an employee who believes the employer is ordering him or
the government as the representative of employees. her to do something in contravention of the collective agreement to
do as directed and then file a grievance later challenging the em-
wage freeze: A law or employer practice that holds wage rates at ployer’s direction. There are some exceptions to this rule.
existing levels for a period of time.
work permit: A legal authorization issued by the Canadian govern-
wage recovery mechanism: A legal provision allowing workers to ment that permits a non-Canadian citizen to work temporarily in
claim unpaid wages before a justice of the peace or magistrate. Canada.
Wagner Act: Collective bargaining legislation enacted in 1935 in the work to rule: A form of strike in which workers collectively and delib-
United States granting workers a legal right to unionize, engage in erately slow down for the purpose of restricting the employer’s
collective bargaining, and strike. The Wagner Act inspired modern output.
Canadian collective bargaining legislation.
Workplace Hazardous Materials Information System (WHMIS):
Wallace damages: A phrase commonly used in wrongful dismissal An information system and database that provides workers and em-
decisions in Canada to describe damages ordered against an employer ployers with information about hazardous materials found in
for acting in bad faith in the manner in which it terminated an employ- workplaces.
ment contract. Wallace v. United Grain Growers Ltd. (1997) was the Su-
preme Court of Canada decision in which these damages were first workplace norms: Norms or expectations that arise in a workplace as
ordered. a result of past practices or relationships that can influence behaviour
at work, even though they are not codified in contracts or statutes.
whistle-blower: An employee who discloses information about
harmful or illegal conduct of their employer or co-workers. wrongful dismissal: A type of lawsuit by an employee against a for-
mer employer alleging that the employer terminated their contract
wildcat strike: A strike by employees that occurs during a period of without complying with the implied term in the contract requiring
time when a strike is not permissible according to collective bargain- “reasonable notice.”
ing laws, such as during the term of a collective agreement.
wrongful quitting: A term sometimes used to describe a lawsuit
wilful breach of contract: A deliberate, defiant, or premeditated vio- filed by an employer alleging that an employee resigned without
lation of the requirement(s) of a contract. providing the employer with the proper amount of notice of
resignation.
without prejudice: A legal phrase used in settlement discussions or
agreements that means that the parties retain the right to revive a yellow dog contract: A contract or contract term that requires an
complaint or bring a new complaint relating to the same facts or issues employee to refrain from joining a union or permits termination for
in the future. cause of an employee who joins a union.

Index
ability to pay principle, 670, 671 “at will” employment contracts, 157-58, 322 Canada–United States Free Trade Agreement
absenteeism, 141, 142, 190-91, 358, 627, averaging agreements, 309, 311-12 (CUFTA), 448-51
633 Canada–United States–Mexico Agreement
acceptance, 100-2, 104, 145 (CUSMA), 446-47
back-to-work legislation, 573, 574
acceptance of employer’s repudiation of Canadian Charter of Rights and Freedoms
bad-faith discharge, 220, 222, 223-24
contract, 202, 211-12 absenteeism due to disability and, 173
balance of probabilities, 181
accommodation, see duty to accommodate analogous grounds of discrimination,
bankruptcy, 273
addiction, 193, 358-59, 380, 382, 635 684, 687
Bardal factors, 159-65, 240-41, 328
adjudicators, see expert administrative application to government actions, 683
bargaining concessions, 543
tribunals Charter challenges, 683-86
bargaining structure, 542
administrative controls, 394 collective bargaining regime and
bargaining unit employees, 508
administrative law, 616 freedom of association, 291, 443,
bargaining units, 484, 504, 672, see also 693-700
administrative leave, 209-10
appropriate bargaining units; unionization
administrative tribunals, see expert freedom of expression, 569, 691-93
process
administrative tribunals freedom to not associate, 617-19
battery, 7, 251
AEPA, see Agricultural Employees Protection right to strike, 574, 668, 694-700
benefits clause, 592
Act common law regime and, 686-87
bereavement leave, 316
age discrimination, 339, 355, 356, 357, enactment of, 682-83
362-63, 687, see also mandatory BFOR, see bona fide occupational
requirement (BFOR) defence enumerated grounds of discrimination
retirement
and, 687
aggravated damages, 220, 222-25 bilateral trade agreements, 445
labour arbitration and, 614, 617-19
Agricultural Employees Protection Act (AEPA), bills, 275
mandatory retirement and, 684, 688
696-97 binding precedent (or binding decision), 7
ambiguous contract terms, 114-15 regulatory standards regime, 687
Bolshevism, 484
analogous grounds of discrimination, 684, work law and, 686, 690
bona fide occupational requirement (BFOR)
687 defence, 373-76, see also duty to Canadian citizens, 411-12
ancestry (discrimination grounds), see racial accommodate Canadian Citizenship Act, 411
discrimination bona fide pension/insurance plan defence, Canadian Human Rights Act, 60, 299, 344
ancillary contract terms and documents, 387 Canadian Labour Congress (CLC), 471, 472,
114, 115, 134, 145-47, 598-600, 608 breach of contract, 6, 183, 252-54, 461, 568, 482
annual hire/general hire contracts, 74-75, see also repudiation of contract; summary Canadian Union of Public Employees
81, 156 dismissal; wrongful dismissal; wrongful (CUPE), 470, 471, 571, 579-84
anti-reprisal provisions, 331 quitting capacity to contract, 98
anti-union animus, 527-30, 564 breach of faithful service, 186-87 captive audience meetings, 505, 533
application for certification, 506, see also Breaches of Contract Act, 478, 481 card-check model, 507, 516-19, 652
union certification process broader-based collective bargaining, 552-53 cartels, 39, 41
apprentices, 476 broader public sector, 662-64 CCF, see Co-operative Commonwealth
appropriate bargaining units, 510-13, 672 bumping rights, 592-93 Federation
arbitration clause, 607 business efficacy test, 134, 135, 594 CCL, see Canada Congress of Labour
arbitrators, see interest arbitrators; labour business representative, 543 certification, 484, see also union certification
arbitrators process
arises and occurs test, 399-400 Canada Congress of Labour (CCL), 481 certification freeze, 545-46
assault, 7, 251 Canada Labour (Standards) Code, 307, 311, certification process, see union certification
assignment of duties, 669 332, 465 process
IN:721

IN:722 Index
CFA, see Committee of Freedom of public sector collective bargaining, 488 complaint-based statutes, 293
Association right to, 464, 700 conciliation, 463, 482, 519
changed substratum doctrine, 124 statutory freeze provisions, 545-46 condonation, 185, 204, 211-12, 229
Charter challenges, 683-86 collective bargaining freeze, 545-46 confidential employee exclusion, 515-16
chief negotiator, 543 collective bargaining regime confidentiality, 81
child-care responsibilities, 365 alternative terms, 5, 17 conflict of interest, 186
child wage penalty, 292 common law, progressive discipline and, Congress of Industrial Organizations (CIO),
CIO, see Congress of Industrial 184-85 485
Organizations employment status and, 59-63 conspiracy to injure, 7, 248, 461, 464
civil law, 4 outputs and legal institutions of, 465 Constitution Act, 1867, 273
civil litigation, 22 overview, 11-12, 13, 21, 459 constructive dismissal
civil status discrimination, 356, 364-66 reinstatement of dismissed employees acceptance of employer’s repudiation of
class action, 310, 432 and, 218-19 contract, 202, 211-12
CLC, see Canadian Labour Congress unionized status under, 466-70 balancing competing interests, 207
coercive drive system, 481 work law subsystem and, 21, 23-24, 30, defined, 139, 154, 202, 323
collective agreements 280 employee compensation change,
colour (discrimination grounds), see racial 205-6
defined, 12, 433, 465, 493, 585
discrimination harassment or poisoned work
duty of fair representation and, 649
commercial contracts, 54 environment, 210-11
legal status of, 586
Committee of Freedom of Association (CFA), intolerable continued employment and,
minimum duration, 589 203-4
443-44
principle of reserved management job assignment change, 206-8
common law of employment contracts, 7,
rights, 589-91
75-81 legal concept of, 202-5
regulation of
common law regime objective test, 203
default terms, 588-89
alternative terms, 5 privacy violation and, 432
mandatory terms, 587-88
collective bargaining, progressive reassignment to a different work
prohibited terms, 589 discipline and, 184-85 location, 207, 208-9
sample agreement, 605-9 defined, 73 substantial breach of an essential term,
sources of terms and rules of employment status and, 55-59 204
interpretation unpaid suspensions, layoffs, or leaves,
job recruitment and hiring process and,
ancillary terms, 598-600 87-93 209-10
expressed terms, 591-93 neoclassical perspective and, 41 contra preferentem doctrine, 115
implied terms, 594-98 overview, 4-9, 13 contract law
workplace privacy and, 433-34 regulatory regime, frustration of common law and, 5-7
collective bargaining, see also union contract and, 174 job recruitment and hiring process and,
certification process; unionization process; reinstatement of dismissed employees 88-89
unions and, 218-19 privacy at work and, 432-33
benefits of, 44 treatment of collective worker activities, contract modification, 102-9
broader-based bargaining, 552-53 460-65 contract term implied “in fact,” 136
Canadian model, 486-88, 504 union legal status under, 644-45 contract term implied “in law,” 136
defined, 460 work law subsystem and, 21, 22-23, 30, contract terms, see also implied contract
history and overview in Canada, 464-65, 280 terms
476-79 community of interest, 511 ambiguous contract terms, 114-15
impasse, see industrial conflict company rules, 597 ancillary contract terms and documents,
overview and stages, 542-45 company unions, 506, 529 114, 145-47
perspectives on work law and, 39-47 comparability principle, 670, 671 expressed contract terms, 113, 115
processes comparable worth, see equal pay for equal parol evidence rule, 114-15
defined, 23-24 work (EPEW) laws sources of
duty of fair representation, comparators, 297 restrictive covenants, 116-18
650-51 compensatory (or ordinary) damages, termination of contract clauses,
duty to bargain in good faith, 545, 219-22, 226-29, 343 118-25
546-52 complaint-based model, 278 contracting out, 579-84, 590, 608

Index IN:723
contracts, see also breach of contract; general damages, 222, 259, 343-44 duty of obedience, 79-80, 81
employment contracts; repudiation of non-pecuniary damages, 259 duty to accommodate, 190, 376-84
contract pecuniary damages, 259, 343 duty to bargain in good faith, 478, 545-52,
defined, 5 punitive damages, 220, 225, 259 696-97
frustration of, 154, 169-75, 190 duty to mitigate, 123, 220, 226-29, 344,
special damages, 259
types of 626
“Wallace damages,” 222, 224
annual/general hire, 74-75, 81, 156 duty to warn, 184
defined, 217
“at will,” 157-58, 322
general theory of, 217-19
commercial, 54 economic globalization, 448-51
wrongful quitting and, 242-43
fixed-task, 119-21 economic threats, 527
deceit, 7, 89, 247
fixed-term, 119-21 economic tort, 568
decertification, see union decertification
indefinite-term, 119-20 economic unionism, 494
decertification petition, 652
voidable, 98 economic warfare route, see also strikes
defamation, 7, 252, 568
yellow dog, 461 lockouts, 559, 570-71
default contract clause, 588
zero notice, 322 unilateral alteration of terms of
demotion, 139, 206, 629
contributory negligence, 257, 392 employment, 571-72, 583
dependent contractors, 54-55, 58-64,
control tests, 56 efficiency concerns, 44
513-14
Co-operative Commonwealth Federation efficient breach, 18
DFR, see duty of fair representation
(CCF), 486 employee charter, 42
direct discrimination, 345-46
“cooling off” period, 463, 478, 482, 563-64 employee notice of termination, see
direct testimony, 616 resignation
core labour standards, 444
disability accommodation, 380-83 employee vulnerability, 155
core public service, 662-63
disability discrimination, 29, 293, 339, 355, employees
corporeal privacy, 429 356, 357-59, 687
courts, 8 defined, 54-55, 59-60
disciplinary demotion, 629
craft unions and craft unionism, 476-77, implied obligations regulating conduct,
discrimination, see also prohibited grounds 138-42
482-83, 485
of discrimination; wage discrimination
crime-related child death/disappearance vs dependent contractors, 59-60
analogous grounds of discrimination,
leave, 316 vs independent contractors, 56-58, 60,
684, 687
Criminal Code, 398, 463, 478, 480, 526 63, 64
defined, 345-47
Criminal Law Amendment Act, 478-81 vs unpaid interns, 62-63
direct discrimination, 345-46
criminal liability, 398-99 employer associations, 13, 24, 38, 465
enumerated grounds of discrimination,
critical reformist perspective, 38, 39, 46 employer expression rights, 532-35
687
cross-examination testimony, 616 employer grievance, 606, 612
indirect discrimination, 346-47
Crown, 662 employer property rights, 531
systemic discrimination, 293, 359
Crown corporations, 663-64 employers
disguised employees, 309
CUFTA, see Canada–United States Free Trade defined, 60
dishonesty, 186, 627-28
Agreement implied terms regulating conduct,
dismissal without cause, see wrongful
culminating incident, 183, 625 142-45
dismissal
cumulative effect constructive dismissal, employment
distinguish, 7
203 defined, 3, 60
Dofasco Way, 25-26
cumulative just cause, 183 vs “not employment,” 3-4, 53-54, 294
domestic worker defence, 387
CUPE, see Canadian Union of Public employment contracts, see also common
drug addiction, 193, 358-59, 380, 382, 635
Employees law of employment contracts; contract
drug test policy, 358-59, 382, 433 terms; contracts; wage regulations
CUSMA, see Canada–United States–Mexico
Agreement due care, 392 defined, 5
due diligence defence, 394 modifications to, 102-9
damages dues check-off, see union dues check-off regulating endings
categories duration clause, 592, 609 protection against unfair dismissal,
aggravated damages for bad-faith duty of care, 90, 254-56 330-32
discharge, 220, 222-25 duty of fair representation (DFR), 614, 643, severance pay, 329-30
compensatory (or ordinary) 646-51 statutory minimum notice of
damages, 219-22, 226-29, 343 duty of fidelity, 81, 138, 672-74 terminations, 322-29

IN:724 Index
employment contracts (cont.) feedback loops, 24, see also external grievance, 612
requirements to create feedback loop; internal feedback loop grievance forms, 612-13
capacity to contract, 98 Female Employees Fair Remuneration Act, grievance procedures, 25, 471, 493-94,
294 611-14, 647-49
intention to contract, 98-100
final offer selection, 574-75, 670 grievance procedures clause, 592, 606
mutual consideration, 102, 104
final offer vote, 558, 570 grievors, 612
offer and acceptance, 100-1, 104
sample, 127-28 first contract arbitration, 573, 574 gross incompetence, 186, 187
employment equity, 344 fixed-task contracts, 119-21 group grievances, 612
employment standards complaints, 327 fixed-term contracts, 119-21
employment status flexible labour, 409-11 harassment, 142, 188, 210-11, 224, 250-51,
food breaks, 316 594, 627, 632
in common law, 56-59
forbearance, 107 hard bargaining, 550-51
in regulatory and collective bargaining
regimes, 59-63 forced resignation, 238 Hawthorne experiments, 41
legal tests for determining Fordism, 81 hearsay evidence, 615
overview, 54-56 foreign nationals, 411-12 hiring, see job recruitment and hiring
process
engineering controls, 394 forum shopping, 345
hiring orders, 343, 344
enumerated grounds of discrimination, fourfold test, 56
687 homeworker defence, 387
fraudulent misrepresentation, 89
equal pay for equal work (EPEW) laws, 288, hours of work and overtime, 309-13
free trade, 27
293, 295-96 hours of work and overtime clause, 592
freedom of association, 291, 440, 443-44,
equal pay for work of equal value laws, 293, 693-700 Hours of Work and Vacations with Pay Act,
296-99 307
freedom of contract, 5-6
equal pay laws, 293, 294-95 Hours of Work (Industry) Convention, 307
freedom of expression, 431, 441, 532-33,
equilibrium wage rate, 39-41 566, 569, 691-93 human resource management (HRM), 41, 43
essential services, 558, 665-68 Human Resources Professionals Association,
freedom to not associate, 700
essential services agreements, 573-74, 667 43
frustration of contract, 154, 169-75, 190
ethnic origin (discrimination grounds), see Human Rights Code, see also duty to
FSSS, see Fédération de la santé et des accommodate
racial discrimination services sociaux
exclusivity, 484, 504 bona fide occupational requirement
(BFOR) defence, 375
exit and voice, 492 gang bosses, 481 discrimination in hiring and, 88-89, 175,
expedited arbitration, 615 gender discrimination, 29, 293, 294, 297-98 341, 354-55, 362, 364
Expenditure Restraint Act, 291 gender expression discrimination, 339, 355, employment status and, 60
experience rating programs, 401 356, 366 human rights commissions, 340, 342-43
expert administrative tribunals, 11, 12, gender identity discrimination, 339, 355, human rights law model, see also
277-78, 392, 397 356, 366 discrimination; indirect discrimination;
expressed contract terms gender neutral job evaluation system, 297 prohibited grounds of discrimination
collective agreements and, 591-93 gender wage gap, 286, 292-99, see also pay complaints process, 343, 345
defined, 113, 115 equity history in Canada, 338-40
restrictive covenants, 116-18 general damages, 222, 259, 343-44 human rights commissions, 340, 342-43
termination of contract clauses, 118-25 general strikes, 479 remedial powers of human rights
external feedback loop, 21, 26, 28-29, 30, gig workers and gig economy, 61-62, 286, tribunals, 343-44
280 513-14 rights concerns at work, 352-54, 374
external inputs, 21, 26-28, 30, 280 Gini coefficient, 45 human rights tribunals, 340, 343-44
globalization
Factories Act, 288, 307 economic globalization, 448-51 IDIA, see Industrial Disputes Investigations
Fair Employment Practices Act, 339 international labour law and, 440-44 Act
family medical/caregiver leave, 316 overview, 439-40 ILO, see International Labour Organization
family status discrimination, 29, 339, 355, trade law and, 444-51 ILO Conventions, 442-44
356, 357, 364-66, 386-87 good faith, 81, 145, 594, see also duty to ILO recommendations, 442
Fédération de la santé et des services bargain in good faith immigrant workers, 19-20, 410, 413-15, see
sociaux (FSSS), 471 government bills, 275 also migrant workers

Index IN:725
Immigration and Refugee Protection Act, 411 injury causation, 399-400 IRS, see internal responsibility system
immigration status, 411-12 injury prevention legislation issue estoppel, 613
implied contract terms criminal liability of organizations, 398-99 IWW, see Industrial Workers of the World
basis for implying terms, 134-36 history in Canada, 392-93
collective agreements and, 594-98 occupational health and safety JHSC, see joint health and safety
defined, 114, 115, 133, 180 legislation, 393-98 committees
origins of, 135 innocent absenteeism, 171, 190, 381, 627, job bundling, 667
regulating employee conduct, 138-42 633 job classifications, 669
regulating employer conduct, 142-45 inside union organizers, 506 job recruitment and hiring process, 87-93
standardized implied terms, 134, 136-37 insolence, 188, 189 job rights clause, 592
income inequality, 45, 308, 499 insolvency, 273, 279 joint health and safety committees (JHSC),
incompetence, 627, 628-29, see also gross insubordination, 138, 188, 189, 627, 630-31 394-95
incompetence insurance plan defence, 387 journeymen, 476
incrementalism principle, 670-71 intellectual property (IP) laws, 10, 27 JPs, see justices of the peace
indefinite-term contracts, 119-20 intention to contract, 98-100 judicial review, 11, 279, 298, 465, 559, 616
indenture, 408 intentional infliction of mental suffering, jurisdiction
independent actionable wrong, 247 250-51 defined, 7, 274
independent actionable wrongs, 220, 225 intentional torts power to regulate work and, 273-74
independent contractors, see also gig assault and battery, 251 trade union status and, 506
workers and gig economy defamation, 252 just cause arbitration law
defined, 54-55, 308-9 inducing breach of contract, 252-54
basic building blocks, 622
vs employees, 56-58, 60, 63, 64 intentional infliction of mental suffering,
mitigating circumstances or factors, 624
independent unions, 529-30 250-51
progressive discipline, 625
indirect discrimination, 346-47 intimidation, 251-52
remedial authority of arbitrators, 625-26
individual grievances, 612 interest arbitration, 544, 558, 669-72
sex at work, video surveillance, and, 632
inducement, 165 interest arbitration route, 572-75
specific grounds
inducing breach of contract, 252-54, 461, interest arbitrators, 12, 24, 558, 669-70
absenteeism, 627, 633
568 interim reinstatement, 535
dishonesty, 627-28
industrial conflict interlocutory injunctions, 259, 461, 567
harassment, 627, 632
CUPE and, 579-84 internal feedback loop
incompetence, 627, 628-29
economic warfare route in work law subsystem, 21, 24-26, 30,
280 insubordination, 627, 630-31
lockouts, 570-71
progressive discipline and, 184-85 intoxication at work, 627, 635
overview, 558-60
statutory minimum notice of lateness, 627, 633
strikes, 560-69
terminations and, 322 off-duty conduct, 627, 633-35
unilateral alteration of terms of
employment, 571-72 wage freezes, unionization, and, 291 violence or threats of violence, 627,
internal inputs, 21-22, 24-26, 30, 280 632
interest arbitration route, 558, 572-75
internal responsibility system (IRS), 394 William Scott three-step analysis, 622-24
resolution options, 558-59
international labour law, see International “just cause” clause, 592
Industrial Disputes Investigations Act (IDIA),
478, 482, 564 Labour Organization (ILO) just cause provisions, 321-22, 588, 607, 622
industrial pluralist perspective, 38, 39, 43-45 International Labour Organization (ILO) justices of the peace (JPs), 74
industrial unions, 477, 482-84, 485 Conventions, 307, 322, 439, 442-44 justification defence, 252
Industrial Workers of the World (IWW), 484 function of, 442-44
inequality of bargaining power, 9-10, 43-44, guiding philosophy, 440-41 Knights of Labor, 482, 483
106, 258 “labour is not a commodity,” 441-42 Krug Furniture strike, 480
infants, 98 unjust dismissal laws and, 331 KVP test, 594, 596, 597-98
informational privacy, 429 international unions, 470
injunctions interns, 62-63, 100, 286 labour arbitration, see also just cause
defined, 9, 248, 258 intimidation, 251-52, 461 arbitration law
interlocutory injunctions, 259, 461, 567 intoxication at work, 142, 193, 627, 635 decisions, 616
labour injunctions, 24 IP, see intellectual property (IP) laws defined, 587

IN:726 Index
labour arbitration (cont.) LMIA, see Labour Market Impact Assessment mitigation, see duty to mitigate
expanding scope of, 617-21 local union presidents, 543 monetary issues, 543
human rights and, 618-19 local unions, 470 multilateral trade agreements, 445
process, 614-16 lockouts, 465, 558-59, 570-72, 581-83, see mutable, 380
remedies, 616-17 also no strike or lockout clause mutual consideration
labour arbitration law, see collective Lord’s Day Act, 307 contract creation and, 102
bargaining regime contract modification and, 102-6
labour arbitrators, 12, 24, 465 magistrates, see justices of the peace origins of, 103
labour cooperation agreements (LCAs), majoritarianism, 484, 504
446-48 management rights clauses, 592, 595-96, NAALC, see North American Agreement on
labour injunctions, 24 605 Labor Cooperation
labour law, see collective bargaining regime managerial exclusion, 312-13, 514-15 NAFTA, see North American Free Trade
Labour Market Impact Assessment (LMIA), managerialist perspective, 38, 39, 41-43 Agreement
413, 415, 418 mandatory arbitration clause, 549, 587 National Labor Relations Act, see Wagner
labour movement mandatory ceiling, 272 Act
1860s to 1910 mandatory certification vote model, 507, National Union of Public and General
craft unionism, 476-77 516-19, 652 Employees (NUPGE), 470, 471
early legislation, pre-1870, 477-79 mandatory collective agreement terms, nationality (discrimination grounds), see
587-88 racial discrimination
early legislation, 1870s onward,
479-81 mandatory floor, 270 “near cause” for dismissal, 166
employer intransigence, worker mandatory interest arbitration, 558, 573 necessity principle, 670, 671
militancy, and, 481-82 mandatory retirement, 119, 124-25, 362, negative freedom of association, 700
Industrial Disputes Investigations Act 684, 688 negligence
and, 482 mandatory time off, 309 defined, 254
early 20th century and interwar years mandatory union dues check-offs, see union duty of care, 254-56
Great Depression and Wagner Act, dues check-off workplace injuries and, 256-57
484-85 mandatory union membership clause, 646 negligent hiring, 257-58
Oshawa General Motors Strike, 485 marital status discrimination, 339, 355, 356, negligent misrepresentation, 90-92, 247,
overview, 482-84 357, 364-66, 386-87 258
foundations of modern collective Master and Servant Act, 76, 477 negligent work, 594
bargaining master and servant law, 5, 73-78, 305, 476 negotiations, 22
PC 1003, 486 master craftsman, 476
neoclassical perspective, 38-41, 285, 305
Rand Formula, 487-88 maternity leave, 316
nepotism defence, 386-87
key moments summary, 478 maximum wage, 35, 292
NIEAP, see Non-Immigrant Employment
public sector collective bargaining, 488 mediation-arbitration (med-arb), 574, 612 Authorization Program
labour picketing, 566-69 Meiorin test, 375-76, 379 Nine-Hour Leagues, 306, 479
labour relations boards, 12, 24, 278, 465 Michelin Amendment, 510-11 Nine-Hour Movement, 25, 481
landed immigrants, 412 migrant workers no-fault principle, 399-400
language discrimination, 355, 366 employment-related legal entitlements, no strike or lockout clause, 587, 607
last chance agreement, 613 416-18
non-competition clauses, 116-18, 140-41
lateness, 141, 142, 190-91, 627, 633 federal regulation of employers of,
non-culpable incompetence, 627, 629-30
418-19
lateral transfer, 206 non-disclosure clauses, 116-17
flexible labour and, 409-11
law of work, see work law non-employees, 287, 308
history in Canada, 407-9
layoffs, 144, 209-10, 669 Non-Immigrant Employment Authorization
precarious status of, 415-16
LCAs, see labour cooperation agreements Program (NIEAP), 409
temporary work permit programs,
leaves clauses, 592 non-intentional torts, 254-58
412-18
leaves of absence, 307-8, 316-17 non-monetary issues, 543
minimum wage, 35-36, 272, 276-79, 286-87,
legislation, 276 288-90 non-motive unfair labour practices, 530
legislative processes, 23-24 minors, see infants non-pecuniary damages, 259
Live-in Caregiver Program, 412-13 mitigating circumstances or factors, 182, non-solicitation clauses, 116-18
living wage, 23, 289-90 624 non-standard work, 64

Index IN:727
North American Agreement on Labor organization test, 56 principle of proportionality, 182, see also
Cooperation (NAALC), 446-47, 449 Oshawa General Motors strike, 485 proportionality test
North American Free Trade Agreement overtime pay, 307, 309-13 privacy at work
(NAFTA), 446, 449, 450-51 common law regime
own account self-employed worker, 63
“not employment,” 3-4, 53-54, 294 contract law and, 432-33
notice of resignation, see reasonable notice tort law and, 430-32
paid time off, see vacation pay
of termination human rights statutes and, 429-30
pardons, 367
notice of termination clause, 25, 119, in a unionized workplace, 433-34
121-24, 142, 154, 239-42 parent unions, 470, 471
parental benefits, 316 privacy legislation
notice to bargain, 542-43
parental leave, 316 federal privacy laws, 426-29
nuisance, 7, 248, 461, 568
parishes, 75 provincial privacy acts, 425-26
NUPGE, see National Union of Public and
parol evidence rule, 114-15 recent case law, reasonableness and,
General Employees
434-35
passing off, 248
sources of law governing privacy issues,
Oakes test, 685 past disability, 357
423-24
objective test, 99, 203, 238, 361, 533 pay equity, 293, 296-99
technology and emerging issues, 425
OBU, see One Big Union PC 1003 (Wartime Labour Relations Order), types of privacy interests, 429
occupational crowding, 294 463-65, 478, 486, 488, 526-27, 542, 561,
video surveillance and, 427-28, 597
586, 607
occupational exposure limits (OELs), 395 private member’s bills, 275
pecuniary damages, 259, 343
Occupational Health and Safety Act, 60, 278, probationary period, 323
396 penal sanctions, 74, 76-77
professional negligence, 255
occupational health and safety (OHS) perceived disability, 357-58
professional strikebreakers, 565
legislation permanent residents, 411-12
progressive discipline, 184-85, 625-27
basis elements, 393-94 permissible wage differences, 298
prohibited grounds of discrimination, see
employer’s obligations, 394 personal care attendant defence, 387
also duty to accommodate
enforcement and remedies, 397-98 personal emergency leave, 317
defined, 351-52
worker’s right to know about hazards, Personal Information Protection and
descriptive lists of forms of, 29, 293, 339,
395 Electronic Documents Act (PIPEDA), 424,
355, 356, 357
worker’s right to participate in OHS, 426-29
forms of, see also religious
394-95 personal protective equipment (PPE), 394
discrimination
worker’s right to refuse unsafe work, picketing, 24, 464-65, 477, 478, 480, 566-69,
age discrimination, 362-63, 687
395-97 668, 691-92
civil status discrimination, 356,
OELs, see occupational exposure limits piecework pay, 287
364-66
off-duty conduct, 191-92, 627, 633-35 PIPEDA, see Personal Information Protection
disability discrimination, 357-59
and Electronic Documents Act
offer and acceptance, 100-2, 104 gender discrimination, 294, 297-98
place of origin (discrimination grounds), see
offer letter, 101 gender expression discrimination, 366
racial discrimination
officious bystander test, 135, 594 gender identity discrimination, 366
POGG power, 273
OHS, see occupational health and safety language discrimination, 366
poisoned work environment, 210-11
(OHS) legislation marital/family status discrimination,
policy grievances, 612
On to Ottawa Trek, 484 364-66, 386-87
political opinion/belief discrimination, 355,
One Big Union (OBU), 484 political opinion/belief
356, 366
One Day’s Rest in Seven Act, 307 discrimination, 366
poor work performance, 627
Ontario Public Sector Employees Union racial discrimination, 361-62, 408
PPE, see personal protective equipment
(OPSEU), 470 record of offence discrimination, 367
precarious work, 64
open period, 508, 652 sex discrimination, 359-61, 687
precarious workers, 308
open work permits, 415 sexual orientation discrimination,
precedents, 7 366, 684-86, 689
OPSEU, see Ontario Public Sector Employees
Union pregnancy, 360 source of income/social condition
Ordinance of Labourers, 74 pressing and substantial concerns test, 685 discrimination, 366-67
ordinary damages, see compensatory (or presumption of annual hire, 81 nepotism defence and, 386-87
ordinary) damages prima facie case of discrimination, 353 physical appearance and, 354-55
organ donor leave, 316 primary picketing, 568-69 pregnancy and, 360

IN:728 Index
promotion, 206 reception, 73 right to know about work hazards, 395

proportionality test, 180-82, 621, 685 recognition clause, 605 right to participate in occupational health
protectionist trade laws, 445 recognition strikes, 460-61, 542 and safety, 394-95
protective standards regulations, 10, 279 record of offence discrimination, 339, 355, right to picket, 464, 569
provincial privacy acts, 425-26 356, 357, 367 right to privacy, 430, 432-33, 597
PSAC, see Public Service Alliance of Canada record suspension, 367 right to refuse unsafe work, 395-97
public policy illegality, 117 recruitment processes, see job recruitment right to strike and lockout, 464, 560-61, 574,
public sector collective bargaining and hiring process 668, 694-700
bargaining unit composition, 672 refusal to perform dangerous work, 631 right to unionize, 525-26
essential services, 665-68 regulations, 10 Rights of Labour Act, 463
history in Canada, 488 regulatory regime rotating strikes, 561
implications of duty to fidelity, 672-74 alternative terms, 5 royal assent, 276
interest arbitration and, 669-72 common law, frustration of contract Royal Commission on Industrial Relations,
and, 174 307, 483
limits on topics for collective bargaining,
668-69 employment status and, 59-63 Royal Commission on Workers’
function of, 271-72 Compensation, 392
strike and picketing rules, 668
Public Sector Compensation Act, 291 jurisdiction to regulate work, 273-74
public sector map, 662 overview, 9-11, 13 safety violations, 186, 187
Public Sector Staff Relations Act, 478, 488 process of law making, 274-77 scabs, 477
public servants, 664-65 reinstatement of dismissed employees scorecard method, 58
public service, 662 and, 218-19 seasonal agricultural worker program, 413
Public Service Alliance of Canada (PSAC), work law subsystem and, 21, 23, 30, 280 secondary picketing, 568-69, 687, 692
471 rehabilitation benefits, 401 self-employment, see independent
punitive damages, 220, 225, 259 reinstatement of dismissed employee, contractors
purposive approach to statutory 218-19, 330-31, 343, 626 self-induced frustration, 171
interpretations, 530 reinstatement of striking workers, 566 seniority, 592-94
related employers, 509 seniority-based benefits, 494
qualified privileges, 252 relief camps, 484 seniority clause, 592, 607
quantum meruit, 145 religious discrimination, 28, 29, 56, 190, 339, seniority provision, 493
quitting, see resignation; wrongful quitting 355, 357, 363-64, 378, 379, 384-85, 687 SER, see standard employment relationship
remedial certification, 536-37 severance pay, 329-30
racial discrimination, 29, 293, 339, 355, 356, remedy, 6 sex discrimination, 339, 355, 356, 357,
357, 361-62, 408, 687 replacement workers, 477, 564-66 359-61, 687
Racial Discrimination Act, 338 replication principle, 670 sexual harassment, 189, 360
racial wage gap, 292 repudiation of contract, 118, 155, 202, sexual orientation discrimination, 29, 339,
radical perspective, 38, 39, 47-48 211-12, 217, 586 355, 356, 357, 366, 684-86, 689
Rand Formula, 478, 487-88, 588, 605 res judicata, 613 shock effect, 496
ratification (of a collective agreement), 543 rescind, 89 sick leave, 317
ratify, 307, 442 reserved/residual management rights, signalling effect, 691
reasonable contemplation test, 220 589-91 sincerely held belief, 363
reasonable notice of termination, see also reservist leave, 317 slowdowns, 561
statutory minimum notice of terminations resignation, 140, 154, 237-42 social clause, 446
assessing an employer’s duty, 159-65 restraint of trade, 478-79 social disadvantage/condition
damages assessed when notice is not restrictive covenants, 116-18, 127 discrimination, 355, 356
given, 242-43 retirement clauses, see mandatory social media posts, 192, 634-35
employee obligations and requirements, retirement social unionism, 494-95
140, 239-42, 327, 594 return to work, 401-2 source of income discrimination, 355, 356,
gender and, 163 revocation of collective bargaining rights, 366-67
“near cause” and, 166 see decertification special damages, 259
origins of, 156-57 right to collective bargaining, 464, 700 special interest organization defence,
vs “at will” contracts, 157-58 right to join a union, 464, 669 384-85

Index IN:729
special program defence, 387 Oshawa General Motors Strike, 485 temporary work permits, 412-15, see also
specific penalty clause, 185 professional strikebreakers, 565 migrant workers
specific performance, 217-18, 626 public sector collective bargaining, 668 termination for cause, see summary
spillover effect, 25, 491 refusal to work voluntary overtime and, dismissal
standard employment relationship (SER), 562 termination of contract, see constructive
63-64, 81 replacement workers, 564-66 dismissal; reasonable notice of
termination; regulating endings under
standard of care, 254-56 right to strike and lockout, 464, 560-61,
employment contracts; summary
standard working hours, 309 574, 668, 694-700
dismissal; wrongful dismissal
stare decisis, 7, 615 rights of strikers, 564-66
termination of contract clauses
Statute of Labourers, 74 Winnipeg General Strike, 483
contractual notice clause, 119, 121-24
statutes, 7 study permits, 412
fixed-term or fixed-task clause, 119-21
statutory bar, 507 subjective test, 99
mandatory retirement clause, 119,
statutory freeze provisions, 545-46 summary dismissal 124-25
statutory holidays, 313-14 basic legal principles, 180-82 overview, 118-19
statutory minimum notice of terminations common grounds for Termination of Employment Convention,
common features absenteeism, 190-91 322
definition of termination, 323-24 breach of faithful service, 186-87 termination pay, 323
employee’s duty to provide notice, conflict of interest, 186 territorial privacy, 429
327 dishonesty, 186 three-person labour arbitration boards, 614
exemption of certain employees, gross incompetence, 186, 187 time theft, 186, 627
325-26 harassment, 188 tipping out, 287
mass terminations and, 323 inappropriate use of employer TLC, see Trades and Labor Congress of
qualifying periods and length of technology, 192-93 Canada
notice, 323, 324 insolence, 188, 189 tortfeasor, 258
defined, 322 insubordination, 188, 189 torts and tort law
interplay with contractual notice intoxication at work, 193 defined, 7-9, 24, 248
requirements, 327-29
lateness, 190-91 intentional torts, 250-54
wilful misconduct and, 326
off-duty conduct, 191-92 non-intentional torts (negligence),
statutory rules, 11
safety violations, 186, 187 254-58
statutory vacation pay, 314
sexual harassment, 189 privacy at work and, 430-32
statutory vacation time, 314
violence or threats of violence, 190 remedies, 258-59
statutory wage floors, 292
condonation of misconduct, 185 vicarious liability and, 248-50
strike pay, 559
defined, 93, 138, 154, 179, 621 trade agreements, 445-51
strikes
evidence of misconduct after decision trade law
broad definition, 561-62
to terminate, 182-83 direct effects of trade agreements,
CUPE and, 579-84
single wrongful acts vs cumulative just 445-48
defined, 11, 460, 559, 561 cause, 183-85 indirect effects of trade agreements,
forms of specific penalty clauses, 185 448-51
general strikes, 479 sunset clauses, 625 overview, 444-45
recognition strikes, 460, 542 supranational laws, 439 trade union status, 506-8
rotating strikes, 561 surface bargaining, 550 Trade Unions Act, 478, 479, 481
slowdowns, 561 survivor benefits, 401 Trades and Labor Congress of Canada (TLC),
sympathy strikes, 480, 562 sympathy strikes, 480, 562 481, 485
wildcat strikes, 563, 594 systemic discrimination, 293, 359, see also Treasury Board, 662
work to rule, 561 gender wage gap trespass to property, 7, 248, 480, 568
incidence in Canada, 560 tribunals, see expert administrative
Krug Furniture strike, 480 tariffs, 444 tribunals
labour picketing, 566-69 temporal privacy, 429
legal preconditions for, 563-64 Temporary Foreign Workers Program, UAW, see United Auto Workers
narrow definition, 562-63 409-10, 413-15, see also migrant workers UFCW, see United Food and Commercial
no strike or lockout clause, 587, 607 temporary layoffs, 209, 325 Workers Canada

IN:730 Index
ultra vires, 273 by union raid, 655 local, 470

unconscionability doctrine, 124 defined, 644 parent, 470, 471
undue fragmentation, 512 due to loss of majority employee legal status to sue or be sued, 644-45
undue hardship, 340, 376, 377-78 support, 652-55 overview of common law treatment,
undue influence, 532-35 due to original certification fraud, 655 460-65
unemployment insurance, 180, 272, 273, effects of, 655-57 reasons and factors for joining
316 employer interference, 654-55 economic reasons, 493-94
unfair dismissal, see also wrongful dismissal failure of “notice to bargain,” 655 instrumental reasons, 492-93
contrary to public policy, 330-31 overview, 651-52 personal and job characteristics, 495
unjust dismissal laws, 330, 331-32 union density rate, 466 socioeconomic status, 495-96
unfair labour practices union dues check-off, 478, 487, 588, 605 work environment, 496
anti-union animus, 527-30 union dues clause, 605 right to join, 464, 669
defined, 484, 504, 525 union membership, 462, 466, 468, 492-96, snapshot of Canadian unions, 470-72
employer expression rights, 532-35 646 work law perspectives on, 39
employer property rights, 531 union membership cards, 505, 646, 652 United Auto Workers (UAW), 478, 485, 487
interference and domination, 529-31 union organizers, 504-5, 518, 531 United Food and Commercial Workers
intimidation and coercion, 527-29 union organizing campaigns, 504-6 Canada (UFCW), 470-71, 500
non-motive practices, 530 union raids and raiding, 472, 508, 655 United Steel, Paper and Forestry, Rubber,
remedies for, 535-37 union recognition clause, 587 Manufacturing, Energy, Allied Industrial
right to unionize, 525-26 and Service Workers International Union
union security clause, 587, 592, 605
substance of freedom of association, (USW), 470, 471
union shops, 487
526-27 unjust dismissal laws, 330-32
union stewards, 471, 606
Unifor, 470-72 unpaid interns, 62-63, 100, 286
union wage premiums, 493-94
unilateral alteration of terms of unpaid suspension, 144, 209-10
unionization process
employment, 571-72, 583
certification, see union certification
union authorization cards, 505 vacation pay, 314-15
process
union avoidance, 25-26, 43 vacation time, 314
employer expression rights, 532-35
union bosses, 496 variable pay, 205
exclusivity, 504
union business representatives, 471 vicarious liability, 54, 224-25, 248-50
majoritarianism, 504
union certification process video surveillance at work, 425, 427-28, 433,
organizing campaign, 504-6, 507
defined, 503, 651 597, 632
statutory rights and, 519
effects of, 541-42 violence and threats of violence, 190, 627,
voluntary recognition, 519 632
jurisdiction and “trade union” status,
506-8 unions, see also duty of fair representation; visitor visas, 412
unfair labour practices
measuring employee support voidable contracts, 98
as agents of social change, 494
appropriate bargaining unit and, voluntary interest arbitration, 558, 573
507, 510-13 collective bargaining regime and,
voluntary recognition, 503, 519
465-70
card-check model, 507, 516-19
effects of
defining the employee, 507, 513-16 wage clause, 592, 608
business innovation, 498-99
identifying the true employer, 507, wage discrimination
508-10 company productivity and profits
and, 496-97 complaint-based statutes, 293
mandatory certification vote model,
employment and, 498 equal pay for equal work (EPEW) laws,
507, 516-19
285, 293, 295-96
politics of, 518 executive compensation, civic
engagement, income equality and, equal pay laws, 293, 294-95
timeliness of certification applications,
507 499 gender wage gap, 286, 292-99
union constitution, 566 forms of pay equity, 293, 296-99
union coverage, 45, 46 company, 506, 529 racial wage gap, 292
union coverage rate, 466-70, 553 craft, 477 systemic discrimination, 293
union decertification independent, 529-30 wage freeze, 290-91, 581-82
by abandonment of bargaining rights, industrial, 477, 482-84, 485 wage-loss benefits, 401
655 international, 470 wage recovery mechanism, 74

Index IN:731
wage regulations external feedback loop, 26, 28-29 leaves of absence, 316-17
excluded employees and, 286 external inputs, 21, 26-28 statutory holidays, 313
maximum wage legislation, 292 internal feedback loop, 21, 24-26 vacation pay, 314-15
minimum wage, 288-90 work law subsystems, 20-24, 30, Workmen’s Compensation Act, 392
scope in employment contracts, 286 280 Workmen’s Compensation Board (WCB),
variation by occupation, 287 higher education and, 6 392, 399-401
wage discrimination, 292-99 perspectives on, 38-48 workplace fatalities, 391-92, 398-99
wage freeze, 290-91 regimes, 4-12 Workplace Hazardous Materials Information
Wagner Act (National Labor Relations Act), work now, grieve later rule, 630-31 System (WHMIS), 395
463, 484, 486, 504, 526 work permits, see temporary work permits workplace injuries, 256-57, see also injury
“Wallace damages,” 222, 224 prevention legislation; workers’
work to rule, 139, 561
compensation legislation
Wartime Labour Relations Order, see PC 1003 worker safety, see injury prevention
workplace norms, 22, 586
WCB, see Workmen’s Compensation Board legislation
wrongful action model, 569
web of contracts theory, 644 workers’ compensation legislation
wrongful dismissal
What Do Unions Do?, 492, 496, 497 funding for compensation, 400-1
categories of damages
whistle-blowers, 331, 674 history in Canada, 392-93
aggravated damages, 219, 222-25
WHMIS, see Workplace Hazardous Materials injury causation, no-fault principle and,
Information System 399-400 compensatory (or ordinary)
damages, 219-22
wildcat strikes, 563, 594 Meredith principles, 392, 399
punitive damages, 219, 225
wilful breach of contract, 183 negligence and, 256-57
defined, 79, 92, 118, 138, 154, 158, 217
wilful misconduct, 326 rehabilitation benefits, 401
duty to mitigate, 226-29
William Scott three-step analysis, 622-24 return to work, 401-2
general theory of damages, 217-19
Winnipeg General Strike, 483 survivor benefits, 401
reinstatement of employee, 218-19
without prejudice, 613 wage-loss benefits, 401
Wobblies, see Industrial Workers of the wrongful quitting, 237-43
working time regulation
World food breaks, 316
work law history in Canada, 306-8 yellow dog contracts, 461
alternative terms, 5 hours of work and overtime pay,
Charter challenges, 687 309-13 zero notice contracts, 322
framework for analysis justifications and limitations, 308-9 zone of agreement, 544


Credits
Acknowledgments
A book of this nature borrows heavily from other published material. We have attempted to
request permission from, and to acknowledge in the text, all sources of such material. We wish
to make specific references here to the authors, publishers, journals, and institutions that have
generously given permission to reproduce in this text works already in print. If we have inadver-
tently overlooked an acknowledgment or failed to secure a permission, we offer our sincere
apologies and undertake to rectify the omission in the next edition.
Chapter 1
Page 6 (Photo): The Law Library at Osgoode Hall. Osgoode Hall Law School.
Chapter 2
Page 19 (Photo): Philipus/Depositphotos.com.
Page 25 (Box 2.2): S. Arnold, “The Dofasco Way,” Hamilton Spectator, June 2, 2012; <http://www.thespec
.com/news-story/2129793-the-dofasco-way>. Reprinted with permission.
Page 28 (Photo): CP Photo/Ryan Remiorz.
Chapter 3
Page 37 (Photo): lev radin/Alamy Live News.
Page 42 (Figure 3.1): Magna Corporation. Reprinted by permission.
Page 45 (Figure 3.2): Statistics Canada, CANSIM Series v21151657, Table 282-0078.
Chapter 4
Page 54 (Cartoon): Rob Elliott/Swizzle.
Chapter 5
Page 77 (Illustration): Illustration of a mid-19th century shoe factory in Nova Scotia. Public domain.
Chapter 6
Chapter 7
Page 99 (Photo): Ray Stubblebine/AP.
Chapter 8
Page 135 (Illustration): The Moorcock unloading its cargo of port wine from Oporo at London Docks,
circa 1909. Public domain.
Page 138 (Cartoon): David J. Doorey & Rob Elliott/Swizzle Studio.
CR:733

CR:734 Credits
Chapter 9
Page 157 (Photo): A threshing crew takes a break from their toil on a Saskatchewan farm, 1911. Public
domain.
Chapter 10
Page 192 (Photo): Rick Madonik/Toronto Star via Getty Images.
Chapter 11
Chapter 12
Page 256 (Photo): Chris VanLennep Photo/Shutterstock.com.
Chapter 13
Page 275 (Photo): THE CANADIAN PRESS IMAGES/Lars Hagberg.
Page 278 (Photo): Steve Russell/GetStock.
Chapter 14
Page 289 (Table 18.1): R. Morisette & D. Dionne-Simard, “Recent Changes in the Composition of
Minimum Wage Workers”; Statistics Canada (13 June 2018), <https://www150.statcan.gc.ca/n1/
pub/75-006-x/2018001/article/54974-eng.htm>.
Page 290 (Photo): Fred Lum/The Globe and Mail/Canadian Press.
Page 299 (Photo): Jacques Boissinot/GetStock.
Chapter 15
Page 306 (Photo): Courtesy of Toronto Plaques, <torontoplaques.com>.
Page 310 (Photo): Scotiabank branch, Toronto, photographer Mike Thompson. Used with permission.
Page 315 (Box 19.3): Based on data from Center for Economic and Policy Research, Washington, DC,
<http://wwwcepr.net>.
Chapter 21
Page 338 (Photo): John Humphrey and Eleanor Roosevelt. Public domain.
Page 341 (Photo): Radharc Images/Alamy Stock Photo.
Chapter 22
Page 342 (Box 22.2) Excerpt from K. Brownlee, “Uglies Need Not Apply,” Toronto Sun, March 22, 2011.
Reprinted with permission of Postmedia.
Page 357 (Table 22.2): Based on data from Canadian Human Rights Tribunal, Annual Report 2018,
<https://www.chrt-tcdp.gc.ca/transparency/AnnualReports/2018-ar/2018-ar-en.html>.
Chapter 23
Page 386 (Box 23.9) Excerpt from Tu Thanh Ha, “How a Kosher Supervisor Was Dismissed for Living
with a Non-Jewish Woman,” The Globe and Mail, July 17, 2019, <https://www.theglobeandmail.com/
canada>. Used with permission.

Credits CR:735
Chapter 24
Page 398 (Photo): Miles Howe/Halifax Media Co-op.
Chapter 25
Page 408 (Photo): Reprinted by permission of Vincent Kong.
Page 410 (Photo): Source: Vince Talotta/GetStock.com.
Page 414 (Box 25.3) Excerpt from Teresa Wright, The Canadian Press. Retrieved from <https://www.cbc
.ca/news/politics/government-temporary-foreign-workers-audit-1.4661312>. Used with
permission.
Chapter 27
Page 440 (Photo): ILO Headquarters.
Page 447 (Photo): AP Photo/Pablo Martinez Monsivais/Canadian Press.
Page 449 (Photo): Mark Spowart/Alamy Photos.
Chapter 29
Page 483 (Photo): Winnipeg General Strike, 1919. Public domain.
Page 485 (Photo): Walter P. Reuther Library, Archives of Labor and Urban Affairs, Wayne State
University.
Page 486 (Photo): (CP PHOTO) 1999 (National Archives of Canada) C-026989.
Chapter 32
Page 531 (Photo): Pictures Colour Library/Alamy Stock Photo.
Chapter 34
Page 567 (Photo): iStock Images.
Page 571 (Photo): Eric Buermeyer/Shutterstock.com.
Page 579 (Photo): THE CANADIAN PRESS/Darren Calabrese.
Chapter 35
Page 590 (Photo): The Globe and Mail Inc./Canadian Press.
Chapter 36
Page 620 (Photo): Reprinted with the permission of The Honourable Warren K. Winkler.
Chapter 39
Page 682 (Photo): Signing of the Proclamation of the Constitution Act © Government of Canada.
Reproduced with the permission of Library and Archives Canada (2017). Library and Archives
Canada/National Archives of Canada fonds/e002852801.
Page 695 (Photo): CP Photo/Ron Poling.





THE LAW OF WORK
SECOND EDITION
David j. doorey
“This is an excellent teaching text—engaging, thoughtful and very well presented. It is

erudite and highly readable.”
—Judy Fudge, LIUNA Enrico Henry Mancinelli Professor in Global Labour Issues
School of Labour Studies, McMaster University
“Comprehensive, insightful, learned, provocative, teachable, and a visual treat. …

David Doorey and his guest experts have touched all the bases. This is the Canadian
employment and labour law text for our time.”
—Harry Arthurs, University Professor of Law and Political Science (Emeritus)
York University
The Law of Work, Second Edition presents a comprehensive overview of Canadian

employment and labour law, drawing on various disciplines including economics,
management studies, and history and examining the social context in which these
laws are made. This updated text introduces students to all three regimes of work
law—common law, regulation, and collective bargaining—and features notable
legal cases and explanations of key concepts, all presented in concise, reader-friendly
chapters. Practical problem-solving exercises and questions are featured throughout,
helping readers apply the law to real-life workplace scenarios.
emond.ca/LW2

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THE

Copyright © 2020 Emond Montgomery Publications

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Toronto, Canada 2020

Copyright © 2020 Emond Montgomery Publications

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Emond Montgomery Publications Limited

We acknowledge the financial support of the Government of Canada

Vice president, publishing: Anthony Rezek Copy editor: Leanne Rancourt

Library and Archives Canada Cataloguing in Publication

Copyright © 2020 Emond Montgomery Publications

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PART I The Law of Work: Themes, Frameworks,

PART II The Common Law Regime

PART III The Regulatory Regime

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Chapter 19 Regulating Hours of Work, Time Off, and Overtime . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 305

PART IV The Collective Bargaining Regime

PART V The Canadian Charter of Rights and Freedoms

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Brief Contents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . iii

PART I The Law of Work: Themes, Frameworks,

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PART II The Common Law Regime

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Questions and Issues for Discussion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 175

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C. Reassignment of an Employee to a Different Work Location . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 208

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PART III The Regulatory Regime

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V. Chapter Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 299

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C. The Bona Fide Pension or Insurance Plan Defence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 387

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VII. Employment-Related Legal Entitlements and Migrant Workers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 416

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PART IV The Collective Bargaining Regime

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A. Instrumental Reasons . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 492

Copyright © 2020 Emond Montgomery Publications

PART I The Law of Work: Themes, Frameworks,

PART V The Canadian Charter of Rights and Freedoms

PART I The Law of Work: Themes, Frameworks,

PART V The Canadian Charter of Rights and Freedoms