Canada: Supreme Court Of Canada Narrows Charter Protection For Collective Bargaining

In a landmark ruling that will impact employment and constitutional law across Canada, the Supreme Court of Canada ("SCC") has revisited its decision in B.C. Health Services (2007) to significantly narrow the protection afforded to collective bargaining under the Charter. In the long-awaited decision in Ontario (Attorney General) v. Fraser (April 2011) ("Fraser") the SCC stepped back from its earlier ruling in B.C. Health Services to make it clear that legislators have considerable latitude in establishing statutory labour regimes, and that the protection afforded to collective bargaining by s. 2(d) of the Charter does not require labour statutes to incorporate a particular model of collective bargaining.

The Fraser case has its origins in an earlier decision involving a constitutional challenge brought by agricultural workers against their exclusion from the Labour Relations Act ("LRA") and the statutory protections for collective bargaining the LRA provides. That challenge was ultimately decided by the SCC in the 2001 decision Dunmore v. Ontario. In Dunmore, the SCC held that the exclusion of agricultural workers from the LRA violated the Charter's guarantee of freedom of association, which includes a right to organize.

In response to the Dunmore decision, Ontario passed the Agricultural Employees' Protection Act, 2002 ("AEPA"), which provided some protections for the associational activities of agricultural workers, albeit in a more limited way than the LRA. The United Food and Commercial Workers Union Canada ("UFCW"), along with Fraser and others, challenged the constitutionality of the AEPA.

At the court of first instance, the Ontario Superior Court of Justice upheld the constitutionality of the legislation—finding that it met the basic requirements set out in the Dunmore decision. The UFCW appealed, and, while the case was winding its way to the Ontario Court of Appeal, the SCC released its monumental decision in Health Services and Support – Facilities Subsector Bargaining Ass. v. British Columbia (2007) ("Health Services").

Health Services And The Charter's Protection For Collective Bargaining

The Health Services case arose when British Columbia, in an effort to control the costs of health care, passed legislation which allowed the government to bypass many of the procedures for outsourcing union work. The legislation was challenged and the case eventually went to the SCC. The SCC re-shaped the landscape of labour law when it built upon the Dunmore decision by holding that workers have a constitutionally-protected right to bargain collectively. This

includes the right to unite, and to present demands collectively to the employer. The employer was held to have a corresponding duty to meet with employees to discuss their demands and to bargain in good faith. The SCC held that the B.C. health care legislation substantially interfered with this right, and that the violation could not be justified under s. 1 of the Charter.

The Court Of Appeal Applies Health Services

Following the constitutionalization of collective bargaining rights in Health Services, the Ontario Court of Appeal released its decision in Fraser. In applying the Health Services decision, the Court of Appeal held that the AEPA breached the Charter for failing to impose on any farm employer the duty to bargain with the bargaining agent chosen by a majority of the workers. The AEPA also breached the Charter by failing to include a remedy, such as compulsory arbitration, for bargaining impasses. In attempting to delineate the scope of the employer's duty to bargain in good faith, the Court essentially imposed requirements from what is referred to as the "Wagner Act" model, the basis for the LRA regime.

The SCC Revisits Health Services

Ontario appealed the Court of Appeal's decision to the SCC, arguing that the Court of Appeal was wrong to require a particular model of collective bargaining. Ontario argued that the notions of exclusivity and majoritarianism from the Wagner Act model which were imposed by the Court of Appeal were not required by the Charter's s. 2(d) guarantee of freedom of association. Ontario further contended that any breach of the Charter by the AEPA was justified by the unique circumstances and conditions of the farm-sector economy, which make mandatory collective bargaining unsuitable.

Taking a significant step back from the broad language in the Health Services decision, the SCC held that s. 2(d) of the Charter only requires that employees be able to make representations to the employer, and to have those representations considered in good faith. The SCC rejected outright the Court of Appeal's view that the employer's obligation to bargain in good faith required elements from the Wagner Act model. The SCC found that in imposing such requirements, the Court of Appeal grossly overstated the scope of collective bargaining rights that are protected by the freedom of association guaranteed by s. 2(d) of the Charter.

The SCC said the question in these cases is whether the impugned legislative scheme renders "association in pursuit of workplace goals impossible, thereby substantially impairing the exercise of the s. 2(d) associational right." In considering this question in the context of the AEPA, the SCC read into the legislation an implicit requirement for employers to consider employee representations in good faith. On this basis, the SCC held that the AEPA met the constitutional requirements under s. 2(d) of the Charter without the need for elements from the Wagner Act model.

The SCC went on to consider whether the LRA and the AEPA violated the Charter's s. 15(1) guarantee of equality by treating farm workers differently from nearly all other workers in Ontario. The Court of Appeal had rejected this particular claim on the basis that "occupational status" is not a ground of discrimination

under the Charter. This was despite its finding that farm workers are disadvantaged and vulnerable. Like the Court of Appeal, the SCC also rejected the s. 15(1) equality claim. The SCC stated that the claim was "premature" because there was insufficient evidence that the AEPA regime "utilizes unfair stereotypes or perpetuates existing prejudice and disadvantage". The SCC stated that until the regime is tested, it cannot be known whether it inappropriately disadvantages farm workers.

The SCC allowed Ontario's appeal and dismissed the entire constitutional claim, without costs.

In Our View

One of the most interesting aspects of the Fraser decision is the SCC's struggle with its previous decision in Health Services and the extent of freedom of association in the employment context. Two of the Supreme Court's judges argued that the Health Services decision should be completely overruled. They maintained that the decision incorrectly expanded the scope of the freedom of association to an unworkable state. However the majority of the judges refused to overturn Health Services because they considered it too early to deem the decision "unworkable." Moreover neither of the parties in Fraser requested that Health Services be overruled. The Court's judgment in Fraser has left open the possibility that the Heath Services decision could be overruled in the future. For now the decision in Health Services stands. It still provides protection for workers' right to bargain collectively, but that protection has been significantly limited by the Fraser decision. As a result of the Fraser ruling, both the federal and provincial legislatures have much more latitude in developing statutory labour regimes. The SCC has made it clear that only legislation that negates the collective bargaining process will be unconstitutional.

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