Unionized workplaces not immune
Background
Just because there is a union, a collective agreement and a grievance arbitration process at a workplace, it doesn’t necessarily mean the employer is immune from civil actions from its employees. While the dispute resolution process is generally thought to be entirely regulated by the collective agreement there are still circumstances in which civil courts retain jurisdiction to entertain an employee's claims against the employer.
In a recent decision dealing with this issue, the Ontario Court of Appeal held the motions judge erred by concluding the courts had no jurisdiction to hear and decide an action brought by employees against their employer.
The case: Guenette v. Canada (Attorney General) (2002), 115 A.C.W.S. (3d) 797, (Ontario Court of Appeal)
Two employees from the Department of Foreign Affairs and International Trade complained of what they perceived to be mismanagement and a waste of taxpayers’ money. They claimed their superiors had not only ignored the complaints but there had also been reprisals against them. They started a civil proceeding against the employer and some senior managers, suing for damages of $3 million each as well as loss of pension earnings.
They also sought an award of $30 million in punitive, exemplary and aggravated damages for the purpose of establishing a non-profit advocacy organization whose mandate it would be to represent and protect the rights of all government employees, particularly as they related to issues of abuse of power, harassment and principles of integrity.
The employees alleged they had been unlawfully harassed by their supervisors since 1992 because of their efforts to ensure cost-effective management of foreign property owned by the Canadian government in operating its diplomatic program. Because of this, the pair claimed they were accused of not being team players, were subject to abusive, threatening and offensive language and were not provided with appropriate facilities at the workplace. As a result, they said they suffered physical and mental breakdowns and their careers in the public service had been ruined.
The plaintiffs were represented by the Public Service Alliance of Canada (PSAC) and were also subject to the terms of the Public Service Staff Relations Act (PSSRA) as well as to the terms of the collective agreement between the Treasury Board and PSAC.
Both the PSSRA and the collective agreement provided for a process entitling employees to present grievances at various levels and prescribing which grievances may be referred to adjudication. The plaintiffs filed grievances under the PSSRA, resulting in one supervisor being reprimanded and a complaint of harassment in the workplace with the Investigations Directorate of the Public Service Commission. The complaint and grievance process were not completed and the plaintiffs started a court action.
In response to the statement of claim, the government filed a statement of defence and immediately brought a motion for summary judgment seeking to dismiss the action on the basis the civil courts had no jurisdiction to deal with the dispute as the allegations fell within the exclusive jurisdiction of the dispute resolution regime established by the collective agreement and the PSSRA. The court granted the motion for summary judgment based on the Supreme Court of Canada's decision in Weber v. Ontario Hydro [1995] 2 SCR 929.
The employees appealed the decision of the motion judge. The appeal court allowed the appeal, indicating the civil courts did have jurisdiction. The civil actions were allowed to continue.
Courts reluctant to allow parallel litigation
In Weber, the Supreme Court of Canada set out the exclusive jurisdiction model which said there is no overlapping jurisdiction between the courts and the grievance process under a collective agreement when the dispute between the parties arises from the collective agreement. In determining whether the dispute arises out of the collective agreement, the courts consider two elements: the nature of the dispute itself and the scope of the collective agreement.
The exclusive jurisdiction approach advocated in Weber confirmed a pattern of growing judicial deference for the arbitration and grievance process arising out of collective agreements and a strong reluctance to allow claimants to proceed with parallel litigation in the courts.
In Guenette, the court noted that courts had reached differing conclusions on whether or not the exclusive jurisdiction model applies to workplace disputes subject to the PSSRA. The differing approaches to this question in the case law turn on whether or not the employee was subject to a collective agreement as well as on the differences in the statutory frameworks of the various pieces of legislation.
The court noted where the PSSRA applied but there was no collective agreement and where the statutory grievance process does not provide final and binding adjudication of the dispute, the courts will accept concurrent jurisdiction over the dispute.
This is particularly the case because the PSSRA does not state that its own grievance procedure is a mandatory one, nor does it expressly bar the employee’s right to bring a civil action. Where the collective agreement makes the statutory grievance procedure mandatory there is little doubt a complainant would be precluded from using the courts to resolve any dispute covered by the collective agreement or the statute.
In Weber, the statute at issue was not the PSSRA but was, instead, the Labour Relations Act (Ontario) which expressly provided for mandatory resolution by arbitration with such resolution being final and binding. In Weber the exclusive jurisdiction model was found to be appropriate for the type of dispute that arose in that case under the Labour Relations Act. The PSSRA, however, entitles (but doesn’t require) the employee to present a grievance. It does not provide a mechanism for a final and binding adjudication of the employee's dispute.
The court in Guenette noted one line of cases consistently shows deference to the statutory scheme set out in the PSSRA and applies the Weber principles notwithstanding the fact the grievance procedure under the PSSRA is optional and the statute contains no privative clause barring further recourse to the courts. These cases were decided on the basis that, “under the modern approach to labour relations, disputes which expressly or inferentially arise out of the collective agreement are foreclosed to the courts.”
A different line of cases, however, focused instead on:
•whether the legislation and the collective agreement showed a strong preference for a particular dispute resolution process;
•whether the substance of the dispute in issue in a particular case is governed expressly or by implication by the legislation and the collective agreement; and
•whether the process favoured by the collective agreement and the legislation provides effective redress for the conduct complained of.
In Guenette the court found there were several reasons to distinguish it from Weber. These reasons related not only to the distinctions, referred to above, between the Labour Relations Act (Ontario) and the PSSRA, but also to:
•important differences between the collective agreements in the two cases;
•the nature of the particular dispute; and
•the question of whether the statute and collective agreement specifically provided for adjudication of the specific complaint at issue.
The court in Guenette identified four factors to support its conclusion that the process for dispute resolution set out in the PSSRA was not intended to be an exclusive one:
•the lack of mandatory language in the PSSRA regarding submitting disputes to grievance proceedings;
•the explicit recognition in the PSSRA that the grievance procedure is not exclusive;
•the limited finality clause in the PSSRA; and
•the lack of recourse to a specialized and autonomous decision-making body.
Perhaps the crux of the decision in Guenette is neither the PSSRA or the collective agreement actually provided an adjudicative forum for all of the disputes at issue. In fact the respondents in Guenette conceded all of the complainant's claims could not be adjudicated under the PSSRA and the collective agreement.
The court dismissed the idea an employee could be prevented from instituting court proceedings in respect of a complaint which would otherwise not be subject to adjudication either under the collective agreement or under the PSSRA.
The upshot of this case is the Ontario Court of Appeal is moving away from unqualified deference to adjudication under a statute or under a collective agreement. The courts will now tend to look more critically at the substance of the dispute or claim in issue and at the terms and parameters of the collective agreement or applicable legislative scheme before striking out proceedings on the basis that the courts lack jurisdiction over such claims and disputes.
This in-depth look at unions was provided by Peter Biro, a partner with Goodman and Carr LLP practising employment law and general litigation. He can be reached at (416) 595-2341 or [email protected].
Just because there is a union, a collective agreement and a grievance arbitration process at a workplace, it doesn’t necessarily mean the employer is immune from civil actions from its employees. While the dispute resolution process is generally thought to be entirely regulated by the collective agreement there are still circumstances in which civil courts retain jurisdiction to entertain an employee's claims against the employer.
In a recent decision dealing with this issue, the Ontario Court of Appeal held the motions judge erred by concluding the courts had no jurisdiction to hear and decide an action brought by employees against their employer.
The case: Guenette v. Canada (Attorney General) (2002), 115 A.C.W.S. (3d) 797, (Ontario Court of Appeal)
Two employees from the Department of Foreign Affairs and International Trade complained of what they perceived to be mismanagement and a waste of taxpayers’ money. They claimed their superiors had not only ignored the complaints but there had also been reprisals against them. They started a civil proceeding against the employer and some senior managers, suing for damages of $3 million each as well as loss of pension earnings.
They also sought an award of $30 million in punitive, exemplary and aggravated damages for the purpose of establishing a non-profit advocacy organization whose mandate it would be to represent and protect the rights of all government employees, particularly as they related to issues of abuse of power, harassment and principles of integrity.
The employees alleged they had been unlawfully harassed by their supervisors since 1992 because of their efforts to ensure cost-effective management of foreign property owned by the Canadian government in operating its diplomatic program. Because of this, the pair claimed they were accused of not being team players, were subject to abusive, threatening and offensive language and were not provided with appropriate facilities at the workplace. As a result, they said they suffered physical and mental breakdowns and their careers in the public service had been ruined.
The plaintiffs were represented by the Public Service Alliance of Canada (PSAC) and were also subject to the terms of the Public Service Staff Relations Act (PSSRA) as well as to the terms of the collective agreement between the Treasury Board and PSAC.
Both the PSSRA and the collective agreement provided for a process entitling employees to present grievances at various levels and prescribing which grievances may be referred to adjudication. The plaintiffs filed grievances under the PSSRA, resulting in one supervisor being reprimanded and a complaint of harassment in the workplace with the Investigations Directorate of the Public Service Commission. The complaint and grievance process were not completed and the plaintiffs started a court action.
In response to the statement of claim, the government filed a statement of defence and immediately brought a motion for summary judgment seeking to dismiss the action on the basis the civil courts had no jurisdiction to deal with the dispute as the allegations fell within the exclusive jurisdiction of the dispute resolution regime established by the collective agreement and the PSSRA. The court granted the motion for summary judgment based on the Supreme Court of Canada's decision in Weber v. Ontario Hydro [1995] 2 SCR 929.
The employees appealed the decision of the motion judge. The appeal court allowed the appeal, indicating the civil courts did have jurisdiction. The civil actions were allowed to continue.
Courts reluctant to allow parallel litigation
In Weber, the Supreme Court of Canada set out the exclusive jurisdiction model which said there is no overlapping jurisdiction between the courts and the grievance process under a collective agreement when the dispute between the parties arises from the collective agreement. In determining whether the dispute arises out of the collective agreement, the courts consider two elements: the nature of the dispute itself and the scope of the collective agreement.
The exclusive jurisdiction approach advocated in Weber confirmed a pattern of growing judicial deference for the arbitration and grievance process arising out of collective agreements and a strong reluctance to allow claimants to proceed with parallel litigation in the courts.
In Guenette, the court noted that courts had reached differing conclusions on whether or not the exclusive jurisdiction model applies to workplace disputes subject to the PSSRA. The differing approaches to this question in the case law turn on whether or not the employee was subject to a collective agreement as well as on the differences in the statutory frameworks of the various pieces of legislation.
The court noted where the PSSRA applied but there was no collective agreement and where the statutory grievance process does not provide final and binding adjudication of the dispute, the courts will accept concurrent jurisdiction over the dispute.
This is particularly the case because the PSSRA does not state that its own grievance procedure is a mandatory one, nor does it expressly bar the employee’s right to bring a civil action. Where the collective agreement makes the statutory grievance procedure mandatory there is little doubt a complainant would be precluded from using the courts to resolve any dispute covered by the collective agreement or the statute.
In Weber, the statute at issue was not the PSSRA but was, instead, the Labour Relations Act (Ontario) which expressly provided for mandatory resolution by arbitration with such resolution being final and binding. In Weber the exclusive jurisdiction model was found to be appropriate for the type of dispute that arose in that case under the Labour Relations Act. The PSSRA, however, entitles (but doesn’t require) the employee to present a grievance. It does not provide a mechanism for a final and binding adjudication of the employee's dispute.
The court in Guenette noted one line of cases consistently shows deference to the statutory scheme set out in the PSSRA and applies the Weber principles notwithstanding the fact the grievance procedure under the PSSRA is optional and the statute contains no privative clause barring further recourse to the courts. These cases were decided on the basis that, “under the modern approach to labour relations, disputes which expressly or inferentially arise out of the collective agreement are foreclosed to the courts.”
A different line of cases, however, focused instead on:
•whether the legislation and the collective agreement showed a strong preference for a particular dispute resolution process;
•whether the substance of the dispute in issue in a particular case is governed expressly or by implication by the legislation and the collective agreement; and
•whether the process favoured by the collective agreement and the legislation provides effective redress for the conduct complained of.
In Guenette the court found there were several reasons to distinguish it from Weber. These reasons related not only to the distinctions, referred to above, between the Labour Relations Act (Ontario) and the PSSRA, but also to:
•important differences between the collective agreements in the two cases;
•the nature of the particular dispute; and
•the question of whether the statute and collective agreement specifically provided for adjudication of the specific complaint at issue.
The court in Guenette identified four factors to support its conclusion that the process for dispute resolution set out in the PSSRA was not intended to be an exclusive one:
•the lack of mandatory language in the PSSRA regarding submitting disputes to grievance proceedings;
•the explicit recognition in the PSSRA that the grievance procedure is not exclusive;
•the limited finality clause in the PSSRA; and
•the lack of recourse to a specialized and autonomous decision-making body.
Perhaps the crux of the decision in Guenette is neither the PSSRA or the collective agreement actually provided an adjudicative forum for all of the disputes at issue. In fact the respondents in Guenette conceded all of the complainant's claims could not be adjudicated under the PSSRA and the collective agreement.
The court dismissed the idea an employee could be prevented from instituting court proceedings in respect of a complaint which would otherwise not be subject to adjudication either under the collective agreement or under the PSSRA.
The upshot of this case is the Ontario Court of Appeal is moving away from unqualified deference to adjudication under a statute or under a collective agreement. The courts will now tend to look more critically at the substance of the dispute or claim in issue and at the terms and parameters of the collective agreement or applicable legislative scheme before striking out proceedings on the basis that the courts lack jurisdiction over such claims and disputes.
| Tips for employers •When negotiating collective agreements it is vital to ascertain which statutory regime applies to the regulation of the relationship between employee, union and employer (for example, LRA or PSSRA, or other statute) and to ascertain whether that statute contains a comprehensive code for the adjudication of all types of disputes and whether resort to the adjudicative framework in the statute is mandatory, final and binding. •Carefully consider the nature of the grievance, complaint or dispute in issue before taking a firm position on whether to advise a union or a worker that the matter is outside the competence of the civil courts and that any civil proceedings will be opposed on that basis. •In negotiating the collective agreement, consider language in the collective agreement which makes the statutorily determined adjudication process mandatory and applicable to all disputes. It is clear that, in having regard to the "essential character of the dispute," courts will be reluctant, after Guenette, to decline jurisdiction over disputes which are not clearly subject to alternative adjudication processes. Cases of note Weber v. Ontario Hydro [1995] 2 SCR 929. The court held the employee could not proceed with the tort component of his civil action which arose from a complaint that his employer had breached his rights under the Canadian Charter of Rights and Freedoms. The court decided the decision maker had to attempt to define the “essential character of the dispute” and to look at whether the statute (in this case, the Labour Relation Act (Ontario)) and the collective agreement provided a mandatory and final adjudicative regime. The court articulated what has come to be known as the “exclusive jurisdiction” model. Weber has become the case to support judicial deference to the exclusive jurisdiction of the collective agreement or governing statute. Pleau v. Canada (Attorney General) (1999), 182 DLR (4th) 373 (N.S.C.A.) In this case the Nova Scotia Court of Appeal refused to apply the Weber case and instead allowed an employee of the Federal Public Service to bring a civil action. The Court distinguished Weber finding instead that the PSSRA did not make resort to the grievance or adjudication process mandatory, it did not provide for a final and binding decision arising out of that grievance or adjudication process and it did not contain a comprehensive code to deal with the adjudication of all types of grievances. |
This in-depth look at unions was provided by Peter Biro, a partner with Goodman and Carr LLP practising employment law and general litigation. He can be reached at (416) 595-2341 or [email protected].
