Wal-Mart wins Quebec labour dispute

Supreme Court of Canada upholds lower court decisions saying store could close rather than deal with union as long as closure is permanent
|employmentlawtoday.com|Last Updated: 12/07/2009

The Supreme Court of Canada has upheld a Quebec Wal-Mart’s right to close its business, despite the fact it did so to avoid having a unionized workforce.

In August 2004, the Quebec Labour Relations Board certified a union to represent the workers of a Wal-Mart store in Jonquière, Que. The union and Wal-Mart were unable to negotiate a collective bargaining agreement, so the board appointed an arbitrator to assist with negotiations. However, on the same day the arbitrator was appointed, Wal-Mart announced it would be closing the store on May 6, 2005. The store was actually closed two weeks earlier, on April 19, terminating the employment of nearly 200 people.

Two employees filed separate complaints, saying their employment was terminated because they had become unionized, a violation of the Quebec Labour Code. The board agreed the employees’ terminations were related to their union activities, but found the store’s closure was “genuine and permanent,” which was “good and sufficient reason” to justify the dismissal. The Quebec Superior Court and Court of Appeal both agreed with the board’s finding and the employees appealed to the Supreme Court of Canada, arguing the collective bargaining process was a constitutional right.

The Supreme Court released its decision in both cases simultaneously, ruling in a 6-3 majority decision that Wal-Mart was entitled to close its business permanently without having to justify it, even if the reasons for the closure were “socially reprehensible.” As a result, the court reinforced the notion that employers can close their business without having to justify it if the closure is definitive and permanent.

However, the court pointed out an employer closed its business purely for anti-union reasons, it could still be exposed to unfair labour practice complaints under sections of the code that deal with employer interference of an association of employees or prevention of employees exercising their Labour Code rights.

For more information see:

Plourde c. Québec (Commission des relations du travail), 2009 CarswellQue 11884 (S.C.C.).
Cie Wal-Mart du Canada c. Québec (Commission des relations de travail), 2009 CarswellQue 11882 (S.C.C.).

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