McGill University Conference

Emerging Issues in Labour Law

Robert Michelin, lawyer

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On Friday, November 29, 1996 and Saturday, November 30, the McGill University Faculty of Law hosted its annual conference in its ongoing series, The Law and You: A Practical Guide. This year's topic, "The New Labour Frontier: Striking the Balance Between Individual and Collective Bargaining Rights", provided a forum for some of the province's most experienced labour law practitioners to discuss some of the new developments which will affect the rights of employers and employees on both an individual and collective level. In addition to the numerous private sector speakers, several representatives from the public sector in both Quebec and Ontario provided an important perspective that enhanced the educational level of the two-day seminar.

Diverse Range of Issues

The three sessions (Friday morning, Friday afternoon and Saturday morning) covered a wide range of issues. The opening session, focusing on the problems of access to collective bargaining in the modern labour relations environment, provided an excellent introduction to one of the central themes of the conference: that despite constant modifications to the legal structure of the employment relationship, its symbiotic nature remains an essential characteristic of our society. The panelists dealt with issues of what they referred to as "industrial democracy" - the problem of ensuring that workers continue to enjoy rights such as the right to unionize, the right to freedom of expression within the workplace and the right to equal treatment under the law.

The suggestion was made that the dependent nature of the employee/employer relationship requires that labour laws provide a degree of protection for workers with regard to their democratic rights within the workplace. Several avenues of accomplishing this objective were reviewed. The corrective approach, for example, focused on the amendment of existing legislation such as the Quebec Labour Code¹ to ensure the continued and constant participation of unions in the formulation of working conditions.

Another option presented was the European approach. This model sees employees, through their unions, having direct representation, at the regional level, in the decision-making apparatus of the enterprise and, at the national level, in the industry as a whole. Whether this model can be incorporated into the contemporary labour relations environment was suggested as a question meriting further examination as the increasing globalization of the economy demands a corresponding increase in the level of harmonization between jurisdictions.

Other featured issues included the jurisdiction of grievance arbitrators, the limits on the authority of the labour commissioner, the right of employers to vocalize their views in the context of the unionization process and the problem of employees' privacy rights in the collective bargaining environment. For the attorney practicing in the field of labour relations, however, perhaps the most interesting discussions were those which focused on the impact of restructuring on the collective bargaining environment and those which dealt with issues of pay equity and the newly introduced provincial legislation

Restructuring

The second group of panelists (Friday morning) focused their discussions on the impact of restructuring on collective bargaining in both the private and public sectors. Of particular interest was the discussion by M^e Jacques Nadeau of the recent jurisprudential developments concerning articles 39 and 45-46 of the Quebec Labour Code, supra:

39. [Powers of labour commissioner] Of its own motion during its investigation and at any time upon request by an interested party, the labour commissioner may decide if a person is an employee or a member of an association, if he is included in the bargaining unit, and any other matters relating to certification.

45. [Certification not invalidated by sale of undertaking] The alienation or operation by another in whole or in part of an undertaking otherwise than by judicial sale shall not invalidate any certification granted under this code, any collective agreement or any proceeding for the securing of certification or for the making or carrying out of a collective agreement.

[New employer bound] The new employer, notwithstanding the division, amalgamation or changed legal structure of the undertaking, shall be bound by the certification or collective agreement as if he were named therein and shall become ipso facto a party to any proceeding relating thereto, in the place and stead of the former employer.

46. [Duty of labour commissioner] It shall be the duty of the labour commissioner, upon the motion of an interested party, to rule on any matter relating to the application of section 45.

[Power of labour commissioner] For such purpose, the labour commissioner may determine the applicability of that section and issue any order deemed necessary to effect the transfer of rights or obligations contemplated therein. He may also settle any difficulty arising out of the application of that section.

Generally, a union has two options at its disposal for the transfer to a new establishment of its accreditation and collective agreement. Article 45 applies where an enterprise or part of an enterprise is sold or transferred from one juridical entity to another, except where the sale or transfer is characterized as a judicial sale. For instance, in a situation where two distinct enterprises merge, a labour commissioner will generally order a corresponding merger of the certifications so that a single bargaining unit is in place. If it is impossible for all the employees to be retained, the seniority lists will be integrated and a vote held to determine the union which will represent the employees.

The problem raised by M^e Nadeau, however, concerns those situations where the "transfer" is not between two distinct entities but between two establishments belonging to the same employer or enterprise. What happens, for example, when a company has two unionized warehouses or factories where the employees are represented by different unions and a decision is made to close one and concentrate activities in the other? Likewise, what occurs where a company in such a situation decides to open a new establishment with modern equipment and puts all the employees together?

Impact of article 39

M^e Nadeau suggests that several recent Labour Court decisions indicate that it is art. 39 and not art. 45 which apply in such situations. He cites four decisions in support of this position, concluding that while articles 45-46 are used to deal with situations where there is a transfer of an enterprise (or part of an enterprise) from one entity to another, it is art. 39 which must apply in situations where the restructuring is internal - where a transfer of manpower, equipment, technology or production has occurred between establishments of the same employer.² Essentially, the cases state that where an internal restructuring involves a transfer of activities or production and is accompanied by the transfer of employees and equipment necessary for the operation of those activities, the labour commissioner deciding on the continuation of the certification or the collective agreement will invoke art. 39. It is important to remember in this context that such a continuation will not be accepted where there has been no corresponding transfer of manpower, machinery or equipment. The mere fact that certain activities covered by a certification are moved to another, already operating establishment will not ensure the maintenance of the certification or the collective agreement.

Another important consideration in the context of any internal restructuring is the impact of certain specific clauses found in existing collective agreements. In this regard, M^e Nadeau acknowledged that the restructuring of an enterprise has effects in areas beyond the certification of the unions already in place.

In any envisioned restructuring, he suggested, particular attention must be paid to the clauses of any collective agreements which deal with issues such as technical change, outsourcing and the preservation of bargaining unit work. He pointed out that many collective agreements contain specific procedures for dealing with employees whose positions are eliminated because of a restructuring ensuing from technological changes or a decision to contract out the work of the employees in question. In such cases, it is incumbent upon the employer to ensure that the treatment of these employees is in accordance with the relevant clauses and it is equally incumbent upon the lawyers advising their employer clients to pay particular attention to these clauses.

Pay equity

One of the featured topics of the conference was the recently-passed provincial pay equity legislation. Several panelists were on hand to present the participants with a wide range of information and opinions on the new law, the content of which is still largely unfamiliar to many Quebec attorneys.

Object of the law

M^e Esther Déom of the Department of Industrial Relations of Laval University explained the principal of the new law: to establish throughout Quebec a situation of basic equality in salary between those jobs traditionally regarded as performed by women and those traditionally regarded as performed by men. "Pay equity" thus refers to a system established to compensate the so-called "feminine" jobs whose value to the organization is equal to that provided by "masculine" jobs but in which, due to systemic discrimination, pay has been and remains inferior.

M^e Déom outlined the steps envisioned by the new legislation in order to accomplish this objective: establish the relative value of jobs, compare those jobs defined as predominantly masculine with those identified as predominantly feminine and finally, where necessary, effect compensation where inequalities are determined to exist. M^e Déom also suggested that it was important not to underestimate the impact of the legislation and the boldness of its proposals. For instance, the law calls for the establishment of a Pay Equity Commission empowered to oversee the implementation of the law and rule on any disputes. The Commission will be subject to the jurisdiction of the Labour Court with any decision being reviewable by the Superior Court.

The law also outlines the different obligations imposed on employers based on the strength of the workforce: 100 or more employees, 50 - 99 employees, 10 - 49 employees. For example, the obligation to establish a Pay Equity Committee within the workplace applies only to those organizations with 100 or more employees. Also discussed in the legislation are the differences in requirements between unionized and non unionized workplaces as well as the delays foreseen for the complete application of its provisions.

Situation in Ontario

The Pay Equity session of the conference was greatly enhanced by the presence of M^e Phyllis Gordon, one-time Chair of the Ontario Pay Equity Hearings Tribunal. M^e Gordon drew upon her experience to suggest directions that may be taken by the Quebec legislation as well as to outline some of the problematic areas of the Ontario model.

M^e Gordon's presentation was facilitated by the provision of several examples of decisions of the Ontario Pay Equity Hearings Tribunal and the subsequent elaboration of some of the technical and procedural issues that have arisen. As an example, several instances were cited where questions had emerged as to who was the actual employer of an individual for purposes of pay equity. This was problematic because the statute itself offers no definition of "employer". Accordingly, it has been decided that the definition must be drawn from the plain meaning of the word "employer" but with the intent of the statute clearly in mind. This is where the problems emerged: although the statute's specific purpose is to redress systemic wage discrimination, it contains labour relations elements as well as human rights elements which are not always complementary.

M^e Gordon also explained some of the early problems that were found in Ontario after the coming into force of its legislation and some of the amendments that have since been made to remedy these problems. Among these amendments are changes to the burden of proof required before the Hearings Tribunal - the amendment places the onus on the employer to show that the harassment or intimidation alleged by an employee in the exercise of her pay equity rights did not occur whereas the original onus was on the employee. It should be noted that the Quebec legislation accepts the amended Ontario version and places the burden on the employer. Other important changes discussed by M^e Gordon included those involving the sale of a business, the powers of Review Officers and the methods of comparing female and male jobs.

Practical implications

Probably the most useful discussion among the pay equity sessions was the panel in which two Montreal practitioners, M^e Claude Tardif and M^e Edward Bridge, approached some of the practical problems of the new legislation. M^e Tardif, from the union side and M^e Bridge, from the perspective of the employer, used a debate-like format to present some of these problems.

One serious problem discussed is the issue of how various positions are to be defined as predominantly "masculine" or predominantly "feminine". What criteria will be used to make this determination? Who will ensure that similar jobs are similarly characterized? Will every new job that is created have to be reviewed and classified before it can be filled? How will the review process function in situations where determinations are challenged? The two practitioners pointed out that while the Ontario example has provided some indications as to how certain issues may be resolved, both employers and unions are still, after several years, faced with a great many unanswered questions.

Another potential problem is ensuring that the workplace committees that must be established in workplaces of over 100 employees are organized according to the requirements of the new law. The law creates a formula for the establishment of these committees: they must contain representation from specific sectors of an organization and that representation must adhere to an established ratio. Given the enormous diversity in the nature of workforces across the province, it was suggested that compliance with a predetermined formula may prove difficult.

Another area of potential difficulty is the manner in which these committees are to operate in the context of existing collective agreements. As indicated, the pay equity legislation combines elements of labour relations and protections against discrimination. With the coming into force of the new law, existing collective agreements will be examined in a new light, one which did not exist when they were initially negotiated. It is not difficult to see that this process raises difficult questions of interpretation.

Still another potential difficulty is the fact that experts will be required to evaluate and determine key elements of the pay equity system. As the contemporary practitioner knows all too well, the costs of such a requirement are often substantial.

M^e Bridge and M^e Tardif discussed the problem of employers' flexibility in decision-making when faced with a very technical, complicated and as yet uninterpreted law. What happens, for instance, in cases of lay-off where the level of employees sinks below the 100 employee ceiling requiring the formation of workplace committees? Will an employer be required to negotiate decisions with the union in this regard? What will be the costs for employers of implementing the required evaluations and corresponding changes in a period where many sectors of the economy are not growing? Clearly, from the perspective of both management and labour these and other questions are going to be raised as the new legislation begins to take effect.

Conclusion

As indicated, for the attorney practicing in the fields of labour relations and employment law, the McGill Conference provided a great deal of useful information about two areas that are likely to see much activity in the near future. Concerning the impact of new jurisprudence on the restructuring enterprise, the Conference gave its participants an opportunity to have some of the most salient points outlined in a concise and useful fashion. As more and more enterprises are forced by changing economic circumstances to consider restructuring options, such information will undoubtedly prove extremely important to attorneys and their clients.

The Conference likewise provided the participants with an introduction to the requirements of the new pay equity legislation. Given the anticipated general application of the new law, the importance of being well-informed of its requirements cannot be underestimated. In this regard, those lawyers who attended the pay equity sessions are off to an excellent start.

1 R.S.Q. c. C-27.

2 Association des employés de Natrel-Trois Rivières c. Syndicat des travailleurs de Natrel-Shawinigan (C.S.N.) et Natrel Inc., D.T.E. 96T-435; Métallurgistes Unis d'Amerique, Local 2423 et Local 5745 c. Sidbec Dosco (ISPAT), et al., D.T.E. 96T-402; Syndicat international des ouvriers de l'aluminium, de la brique et du verre, section locale 274 (FTQ) c. IPEX Inc., D.T.E. 96T-584; Syndicat des salariés de Crown-Diamond Paints (C.S.D.) c. Sico Inc. et Syndicat des employés de Sico Inc. (C.S.N.), D.T.E. 96T-952.

 

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