The right to strike: Supreme Court’s labour trilogy has wide ranging impacts

After decades of jurisprudence about the Charter’s guarantee of freedom of association, last year’s SCC labour trilogy of decisions enshrined the right to strike as an “indispensable component” of collective bargaining

The words “Labour Trilogy” never made it to the public eye last year during the long and uncertain standoff between Ontario’s Liberal government and the province’s teachers. But it’s hard to avoid wondering to what extent the Supreme Court of Canada’s January 2015 decision limiting governments’ powers to prohibit strikes had on the government’s position.

Doubtless, teachers’ unions in BC, where tough collective bargaining issues are surfacing, are also looking at the trilogy, as are unions in PEI, where teachers don’t have the right to strike.

“The trilogy definitely called into question the extent to which the government can create orderly arrangements for collective bargaining,” says Murray Murphy of Stewart McKelvey in Charlottetown, PEI.

The trilogy of decisions ‒ Saskatchewan Federation of Labour v. Saskatchewan, Mounted Police Association of Ontario v. Canada (Attorney General) and Meredith v. Canada (Attorney General) – enshrined the right to strike as an “indispensable component” of collective bargaining, itself protected under previous high court interpretations of the Charter. They culminated in what can fairly be described as three decades of tumultuous jurisprudence about the Canadian Charter of Rights guarantee of freedom of association and its relevance to union organization and collective bargaining.

From a legislative perspective, the trilogy means that statutory limits on collective bargaining will be subject to greater scrutiny, and essential services legislation limiting the right to strike will need to go no further than necessary. From a dispute resolution perspective, courts, labour relations boards and arbitrators will have to take the trilogy into account, which could result in narrowing interpretations of employers’ rights.

Murphy also believes that the economy generally could be affected by the trilogy if governments remain focused on the need to drive down deficits. “The limitations on the right to strike will really curtail governments’ ability to control their budget, because obviously wages are the biggest item on the balance sheet,” he says. “And even with the decreased unionization in the private sector, public-sector benefits tend to get translated from the precedents set in the public sector.”

While to many observers the trilogy sounds primarily in the public sector, it seems counterintuitive to suppose that impacts on a sector that comprised 24.1 per cent of Canadian employment in 2013 (up from 22.3 per cent in 2003) would not trickle down to the private realm.

At the very least, restraints the trilogy puts on governments seeking to inhibit strikes by categorizing certain sectors as essential services could see the private sector indirectly affected as strikes in the government sector become a more appealing alternative to public unions. Non-essential workers in complementary bargaining units who serve essential services could also be affected.

“If teachers or firefighters or nurses can’t be prevented from striking, what impact will that have on staff unions in the same workplace who may decide not to cross picket lines or take complementary job actions?” Murphy asks.

More directly, private companies like Air Canada and Bruce Power, whose operations are central to the economy, could also face greater potential for strikes, as could private enterprise concerns that benefit from the public sector’s growing inclination to outsource.

It could also encourage unions to build their membership base more aggressively, affect union politics, impact outsourcing decisions in the private sector and influence other emerging developments in labour and employment law.

“The conceptual framework of the employer-employee relationship is evolving rapidly,” says Michel Carle of Montréal, National Practice Group Leader of Norton Rose Fulbright Canada LLP’s Employment and Labour Practice. “The classical notion of what constitutes an employee may not be definitive any longer, and that’s important because what is an employee is central to the right to unionize or the right to associate.”

The upshot is that the trilogy may encourage groups as varied as doctors and Uber drivers who may be excluded from labour relations legislation to test the limits of the restrictions on the right to associate.

“The overarching effect of these decisions is to move labour relations in Canada further away from a question of economic relationships to one of constitutional rights,” notes Michael Torrance of Toronto, writing in Norton Rose Fulbright’s Legal Update. “Consequently, employers can likely expect more permissive treatment of unions and their membership wherever a linkage to freedom of association or freedom of expression can be found.”

Indeed, the two minority judges in Saskatchewan Federation of Labour cautioned that institutionalizing the right to strike among fundamental Charter rights would alter the balance between employees, employers and the public.

Ironically, the decline in unionization could escalate the impact of the trilogy.

“Unions’ decline has actually made them more radical in their demands and they fight harder to protect their sphere of control,” says Ranjan Agarwal of Bennett Jones LLP in Toronto. “It’s the classic situation where the more intense the issue, the more intense the fight.”

Whether any of the stakeholders can expect greater certainty in labour relations and consistency in subsequent judgments, however, remains to be seen.

“The trilogy demonstrates the fundamental problem with jurisprudence that doesn’t see the forest for the trees in its concern for fashioning results to achieve workplace or social justice,” says John Craig, a management-side labour lawyer at Fasken Martineau DuMoulin LLP in Toronto, who represented two interveners, the Canadian Employers Council and the Mounted Police Members Legal Fund, in the trilogy. “The court has had no problem overturning previous decisions on this issue, so why would it – especially if it was differently constituted – have a problem overturning Saskatchewan Federation of Labour? And that makes things very confusing from an employer perspective.”

 

The SCC released the trilogy in January 2015, almost three decades after its 1987 decision in Reference Re Public Service Employee Relations Act (Alta) (the “Alberta Reference”), where the court ruled that the right to associate protected only individuals and not collective rights.

“There’s been a historic allergy to institutionalizing the right to strike,” Agarwal says. “And 30 years ago, the Supreme Court, apart from Chief Justice [Brian] Dickson who dissented, just couldn’t get their heads around it.”

In jurisprudential terms, 28 years is not necessarily a long time. Still, the SCC’s path from limiting freedom of association to individuals before expanding it to including the right to bargain collectively and then the right to strike, can hardly be described as direct.

“The shifting sands of freedom of association jurisprudence have been incoherent for at least 10 or 15 years,” Craig says. “The SCC just seems to keep moving in the direction of the results it wants to get as particular cases come up.”

There was almost a 15-year gap between Alberta Reference and Dunmore v. Ontario (Attorney General), a 2001 case in which the Supreme Court of Canada struck down provisions of Ontario’s Employment and Labour Statute Law Amendment Act that excluded agricultural workers from the province’s labour laws. In recognizing that some collective activities were subject to freedom of association Charter protection, the high court effected what amounted to at least a partial turnaround on the reasoning in Alberta Reference.

“The law must recognize that certain union activities – making collective representations to an employer, adopting a majority political platform, federating with other unions – may be central to freedom of association even though they are inconceivable on the individual level,” the majority wrote.

But it was not until 2007, in Health Services and Support ‒ Facilities Subsector Bargaining Association v. British Columbia, that the SCC explicitly ruled that the Charter protected unionized employees’ right to bargain collectively. The court was clear, however, that this right did not include a guarantee of any particular bargaining model or outcome. The status of the right to strike, then, remained murky.

But with four years to think about it, the SCC managed to make things even murkier in Ontario (Attorney General) v. Fraser.

BC Health Services had left most observers with the belief that the right to strike was protected, although the SCC had not specifically endorsed that principle. Fraser turned the status of the right to strike into an open question, extending the uncertainty that had characterized freedom of association jurisprudence in Canada.

The SCC decision in Fraser followed on the Ontario Court of Appeal’s ruling that the Agricultural Employees Protection Act, 2002 (AEPA) was unconstitutional because it provided more limited protection for the bargaining rights of farm workers than the Ontario Labour Relations Act, 1995, which applied to most private-sector employees. In particular, the legislation did not require employers to recognize farm workers’ bargaining rights or to bargain in good faith. The OCA reasoned that BC Health Services dictated that result because, without the inclusion of these rights, the AEPA did not allow for meaningful collective bargaining.

But in a 2011 decision much more sharply divided than the 8‒1 ruling might suggest, the Supreme Court reversed the decision below and upheld the AEPA. It also created jurisprudential chaos and confusion for both employers and employees.

Two of the three judges concurred in the result but wrote separate reasons suggesting that BC Health Services was wrongly decided and unworkable. By contrast, the five judges who constituted the core majority devoted most of their reasoning to justifying the BC Health Services decision in a pointed rebuttal more characteristic of the type of acrimonious debate found in decisions of the United States Supreme Court.

The result, however unexpected, came as a welcome shock to the business community. “Regardless of whether BC Health Services was eventually reversed, employers were breathing a sigh of relief that the protection afforded to collective bargaining was not as broad as the Court of Appeal suggested,” Craig says. “Had the OCA’s decision stood up, it would have meant that employees were entitled to a particular form of bargaining rights that guaranteed their right to associate.”

But at the same time, the majority in the Supreme Court did make it clear that employers had a duty to consider employee representations in good faith and to “engage in a process of meaningful discussion.” To this end, the majority stated that legislation that “makes good faith resolution of workplace issues between employees and their employer effectively impossible” would violate the Charter.

“Not only did Fraser fail to settle the scope of collective bargaining protection, it opened the door to another round of constitutional litigation that could have resulted in the reversal of BC Health Services,” Craig notes.

The litigation did come. But the reversal did not.

Two of the cases involved in the 2015 trilogy that enshrined the right to strike, Mounted Police and Meredith, involved the RCMP. In these cases, the government held that the unique bargaining scheme that the federal government had imposed on the RCMP violated s. 2(d) (freedom of association) of the Charter. In Saskatchewan Federation of Labour, the court went further: faced with essential services legislation, the court ruled that s. 2(d) protection included the right to strike as an “indispensable component” of the right to bargain collectively.

“The decisions in these cases turned the jurisprudence on its head,” Craig says. “The majority’s reasons in Saskatchewan, in particular, don’t seem to reference legal principle so much as they reflect the political and social views of the judges.”

But Chris Paliare, a veteran of union-side labour relations law at Paliare Roland Rosenberg Rothstein LLP in Toronto, says the labour trilogy does in fact make sense. “The very notion of collective bargaining implies that there is an imbalance between workers and employees,” he says. “So unless you have an inherently anti-union bent, you have to accept that workers need the fundamental right to bargain collectively, to be protected from unfair labour practices and to take strike action in order to address that imbalance.”

Paliare also believes that the trend to expanding the reach of s. 2(d) is a sign of the times. “The earliest decisions which ruled against the right to strike as a constitutional right came when the Charter was still new,” he says. “Collective bargaining was more robust then and I think the courts are recognizing that workers need more protection today.”

 

But times change. So will the law change yet again? What’s not likely in doubt is that the opportunity to shift direction again abounds.

There’s no doubt that employers, both public and private, feel threatened. So much so that Saskatchewan Premier Brad Wall reacted to the trilogy by announcing that he might resort to the infrequently used “notwithstanding clause,” which allows provinces to override Charter rights. For their part, Nova Scotia unions have seized on the trilogy to challenge that province’s essential services legislation: although it differs significantly from the Saskatchewan legislation, the unions’ lawyers strongly believe that the trilogy has the law poised to further expand union rights.

In Alberta, it didn’t take long for the trilogy to raise significant questions about the province’s labour legislation. Patrick Nugent of Nugent Law Office in Edmonton, counsel for the Alberta Union of Public Employees, which intervened in Saskatchewan Federation of Labour, was quick to muse publicly that the Alberta government will have to revisit its laws if it intends to ensure that they remain constitutionally onside.

Tracey Epp of Pitblado LLP in Winnipeg says the trilogy could impact portions of Manitoba’s essential services legislation. She also sees a potential impact on the Manitoba Labour Board’s rules of procedure. They include, for example, provisions limiting the right to participate in certification votes to workers who have a real connection to the workplace. The rule mostly impacts part-time and casual employees: their right to vote is determined by a board audit going back between 13 and 16 weeks to establish how often individuals actually worked at the proposed bargaining unit.

“The union could well argue that employees don’t give up their constitutional rights just because they work only every couple of weeks,” she says. “If that’s right, it will affect amalgamations, decertifications and other situations as well as all certification proceedings.”

Unions, ironically, might also find the trilogy a bit awkward. Some, according to Epp, agree to exclude casual employees from bargaining units or allow them only minimal rights. “Unions take that position because they recognize that in many cases casual workers can’t pay dues,” Epp says. “But that doesn’t make their position constitutionally valid.”

The trilogy could also affect unions that are legislatively or otherwise entrenched as exclusive bargaining agents, as they are in PEI’s public sector.

“If some members become unhappy with their union and think they can do better with another one, they might challenge those aspects of the legislation that restricts their right to choose their union,” Murphy says.

Similarly, the trend to move the certification process from a card-based to a vote-based system may accelerate. “In a card-based system, unions can get a majority discreetly by signing up enough people without necessarily talking to everyone and with some individuals actually having no knowledge of what’s going on,” Carle explains. “The trilogy could support the argument that any system that doesn’t involve a universal vote encroaches on freedom of expression or association.”

More immediate is the constitutional challenge that CUPW has launched attacking the federal government’s 2011 back-to-work legislation (Bill C-6, Restoring Mail Delivery for Canadians Act) for 48,000 Canada Post employees in anticipation of a lawful strike.

Paul Cavalluzzo, who represents CUPW, told Justice Stephen Firestone of the Ontario Superior Court in October that Bill C-6 “unilaterally” prohibited any lawful strike and therefore denied members their right to freedom of expression and association. The fact that the legislation also contained a proposed settlement process that involved a final-offer selection process did not save it, Cavalluzzo reasoned, inasmuch as it offered lower wages than the government had previously offered, dictated the length of the agreement, and imposed a condition that any settlement not have a detrimental impact on Canada Post’s bleeding pension plan.

Firestone’s decision, which was reserved at press time, will therefore be a first determination of whether and in what circumstances provisions for third-party resolution could save back-to-work legislation. Whatever the result, there’s little doubt governments are going to have to become more creative.

“Governments will be very limited in their attempt to adopt right-to-work laws or restrict the right to strike,” Carle says. “The trilogy means that they will always have to be reasonable when they’re considering back-to-work legislation, and cannot legislate simply on the basis of the political winds.”

While the inclusion of a constitutionally compatible form of interest arbitration, for example, may fortify back-to-work legislation, there’s an irony here.

“Interest arbitration, which is common when the government steps in to a strike situation, tends to favour unions,” says Sunil Kapur of McCarthy Tétrault LLP in Toronto. “Employers don’t like it and many prefer the right-to-strike environment.”

 

Many lawyers, including management-side lawyers, believe that despite its inconsistent history, the Supreme Court is unlikely to deviate significantly from its current right-to-strike position.

“I don’t believe this court will resile because the horse is out of the stable and I don’t remember a time when the court has said that it took constitutional rights too far and had to take them back,” says Agarwal, who practises primarily on the management side. “Academics may say that the court has in fact done so, but from a practitioner’s standpoint, the general trajectory of the court is in this direction.”

That’s not to say that the trilogy, like most landmark decisions, will not spur its share of litigation. But Carle says that the jurisprudence going forward will not be earth-shattering. “There’s not much left now for unions to argue other than testing the extent of what the Supreme Court has already decided,” he says.

Kapur agrees. “There’s nothing more significant down the road,” he maintains. “Everything that’s truly significant to freedom of association in the unionization context happened in the trilogy.”

As for legislative change, constitutional cases can be a particularly daunting roadblock for business. “Generally speaking, business has had a pretty good run at lobbying to effect changes when they think there’s an attack on the bottom line and it looks like the pendulum has swung too far,” Agarwal says. “But decisions like the trilogy effectively allow unions to thumb their nose at legislation, knowing they can attack it on a constitutional basis.”

However one looks at the situation, Canada has come a long way since the 1930s, when unions and individuals who were involved in promoting or formulating agreements related to wages, hours of work and conditions of employment could still be prosecuted as effecting illegal combinations under the common-law concept of conspiracy to injure.

“I can’t think of any right associated with unionization that’s not protected by the Charter these days,” Carle says.

In a sense, that may say it all.