Canada: Major Challenges On The Horizon: The Act To Modify The Organization And Governance Of The Health And Social Services Network, In Particular By Abolishing The Regional Agencies – Bill 10

In recent months, a persistent rumour has been making the rounds (a rumour more tangible than the echo of mere declarations of intent) to the effect that a major reform of the health and social services network ("HSSN") was in the works. On September 25 last, the Minister of Health and Social Services (the "Minister") put an end to such speculations by tabling a bill entitled An Act to modify the organization and governance of the health and social services network, in particular by abolishing the regional agencies ("Bill 10").1 In its present iteration, Bill 10 provides for sweeping changes in the governance and organization of care and services within the HSSN -- changes the ultimate implementation of which foreshadows a major shake-up, especially in labour relations and the organization of human resources.

If assented to in its present form next December, as announced, the essential provisions of Bill 10 should come into force on April 1, 2015 (Bill 10, section 165). In that case, the amendments envisaged will basically take the form of major changes to the Act respecting health services and social services ("AHSSS").2Although that schedule must be regarded as tentative, in view of the many stages of the legislative process through which Bill 10 must still pass, it is foreseeable that the Bill will not undergo any substantial amendments between now and the date of its sanction, in view of the current political context.

This newsletter aims to give a general outline of the changes that have been announced, several of which might be implemented during the coming year.

Bill 10's General Objectives

Bill 10 provides for a number of important changes to the organization of the HSSN and its rules of governance, through the implementation of some major structural alterations. The measures in view are intended to improve effectiveness, efficiency, security, accessibility and the quality of care and services through planning and centralized management of health and social services (Bill 10, section 1). According to the Ministry of Health and Social Services ("MHSS"), the recurrent savings would be of the order of some 220 million dollars, once the measures are in effect.

Bill 10 provides for the regional integration of health and social services by abolishing the regional health and social services agencies (the "Regional Agencies") and creating regional institutions resulting from the amalgamation of the Regional Agencies and grouping institutions together within defined territories. The proposed reform provides for the complete redefinition of the boards of directors of these institutions, as well as for more extensive rights of supervision and intervention for the Minister in regard to their management. Moreover, the restructuring heralds some major disruptions in labour relations and the management of human resources.

Abolishing the Agencies – Creating "Centres intégrés de santé et de services sociaux" (CISSS)

At the present time, three levels of management exist within the HSSN: the MHSS, 18 Regional Agencies and 182 public institutions.

Bill 10 would reduce the size of the HSSN by abolishing one of those levels, namely, the Regional Agencies, as well as the number of public institutions, by grouping them together within a single institution for each "health region" identified (of which there are 16). Those "regional institutions" would be designated as "Centres intégrés de santé et de services sociaux" ("CISSS") (Bill 10, sections 3 and 4). When this reduction in the number of public institutions, which began in 1990, will be completed, there would remain only 28 of the 182 institutions now in existence. Owing to its specific character, however, the Montreal region would be divided into 5 CISSS districts (North Island, Centre-Island, Southeast Island, and East Island) (Bill 10, section 4). By virtue of the special role that they would perform, the territory they would serve and the particular characteristics of those areas (as regards population, culture and history), 4 "supra-regional" institutions, all of them located in the Montreal area, would survive, namely, the Centre hospitalier de l'Université de Montréal (CHUM), the Centre hospitalier universitaire de Ste-Justine (CHU Ste-Justine), the McGill University Health Centre (MUHC) and the Institut de cardiologie de Montréal (ICM) (Bill 10, section 7).

The duties formerly entrusted to the Regional Agencies would be taken over and assumed by the MHSS, as well as by the CISSS and the supra-regional institutions, according to their respective roles (Bill 10, section 5). The CISSS would thus become "regional one-stop windows" whose role would be planning all aspects of healthcare and social services in a given "regional health and social services network" (Bill 10, section 5). Within that framework, certain special inter-regional "service corridors" could be determined by the Minister, so as to ensure users "continuity of services" or "access to services" within a reasonable time (see especially Bill 10, sections 36 to 39). The regional and supra-regional institutions would be managed by a "president and executive director" ("PED") and an "assistant president and executive director" ("APED") appointed by the Minister for a term not exceeding 4 years. They would perform their duties full-time (exclusivity of functions)3 and receive remuneration determined by the Minister (Bill 10, sections 28 to 33). We would point out, in this latter regard, that Bill 10 provides that the payment of any remuneration or benefit other than that so set would be punishable by a fine of up to $50,000 (Bill 10, sections 30 and 31). If Bill 10 came into force according to its present terms, the appointment of the new PEDs and APEDs, whose identities would be disclosed thirty days after Bill 10 comes into force, would take effect as of April 1, 2015 (Bill 10, section 150).

Changes Affecting the Boards of Directors of Public Institutions

Every public health institution has a board of directors, defined and governed by the above-mentioned AHSSS, as well as by its regulations4 (re appointment of its members, composition of its board of directors, extent and term of mandate, etc.). If adopted, Bill 10 will make some major changes in this regard.

In view of the creation of the CISSS, the announced reform would substantially reduce the number of boards of directors working within the HSSN: the terms of office of the members of the boards of directors of the Regional Agencies and the amalgamated institutions would be deemed to end on March 31, 2015 (Bill 10, section 148). Depending on whether a CISSS or a supra-regional institution was concerned, the new boards of directors to be set up, with their composition completely redefined by Bill 10, would henceforth include from 13 to 15 members, all of them appointed by the Minister, on the basis of specific recommendations (Bill 10, sections 8, 9 and 13), for a term of office not exceeding 3 years (Bill 10, section 16). The chair of such a board of directors, also appointed by the Minister, would be appointed every two years from among the "independent persons" sitting on the board (Bill 10, section 19).

In this regard, Bill 10 provides that the board of directors shall be composed of a majority of these "independent persons" (7 to 8, depending on the type of institution concerned), who shall be selected by the Minister from a list submitted by a "committee of governance experts" in relation to specific expertise profiles determined by Bill 10, to wit: "governance and ethics", "human resources", "auditing and performance", "social services", "risk management and quality", "immovable property resources and information resources" and "youth" (Bill 10, sections 8, 9, 11 and 12).

The representation of the different interest groups in the HSSN would be ensured by the appointment of one member from each of them: the council of physicians, dentists and pharmacists (CPDP), the council of nurses, the users committee, etc. In return, Bill 10 specifically provides that the selection of the members of the board of directors should ensure the adequate representation of the various parts of the territory served by the CISSS in question and the demographic composition of its user population, and should comply with the obligation to observe male-female parity (Bill 10, sections 13 and 14). We note that a "non-voting observer" may be appointed by the Minister at the request of the foundation of the institution concerned (Bill 10, section 10). One important new change is that Bill 10 provides that the members of the board of directors, apart from the allowances and indemnities determined by the government, may henceforth receive a "remuneration" which is also set by the government (Bill 10, section 15).

Increased Powers for the Minister of Health and Social Services

In the wake of the changes announced, Bill 10 grants to the Minister wider powers than those now conferred upon him or her by the AHSSS.

In particular, if Bill 10 were adopted, the Minister would be empowered to prescribe rules relating to the organizational structure for managing a public institution and any other measure to improve the organization and sound management of its resources, rules which would have to be implemented by the institutions by way of an administrative restructuring no later than 6 months following the coming into force of the regulation adopted for that purpose (Bill 10, sections 130 and 147). Along the same lines, the Minister could issue directives to a CISSS or a supra-regional institution concerning that institution's objectives, policies and actions in the performance of its functions (Bill 10, section 132). A special right of intervention in managing the institutions' resources would be granted to the Minister where the there was a "need to optimize resources", thus permitting the Minister to oblige any such institution to use the services of a joint procurement group or to participate in a call for tenders held by such a group (Bill 10, section 80). In the event of any acts being done by a PED, an APED or a board of directors which are incompatible with "sound management", the Minister would be empowered to appoint or replace a PED or an APED, and even to assume some of the responsibilities of the board of directors for a period not exceeding 180 days, which could be extended for a similar period (Bill 10, sections 134 and 135; see also section 137). Lastly, we note that the Minister would henceforth be responsible for establishing budgetary rules for institutions and that he would identify the amount of the operating expenditures allowed in their "service programs" according to Bill 10, those budgets to be made known on April 1, 2015 (Bill 10, section 25, 90, 94 and 152).

The Impact of Adopting Bill 10 on Labour Relations

If Bill 10 is likely to entail an in-depth transformation of the structure and governance of the HSSN, its objective is also to achieve considerable savings by reducing salaries. In a highly unionized environment such as the HSSN, attaining such an objective necessarily gives rise to major labour relations issues. Indeed, it is probably no exaggeration to say that Bill 10 will have at least equivalent, if not greater, impact than that of Bill 30, adopted in 2003.5

Bill 10's impact on labour relations will probably be felt in 3 stages:

  1. When it comes into force: All employees of the Regional Agencies and institutions will suddenly change employers. The majority of employees of the HSSN will become employees of the CISSS (Bill 10, section 145). The others will become employees of the MHSS (Bill 10, section 144). Since this change is likely to affect the application of a certain number of rules applicable in the area of labour and employment law6, it will be advisable for the new employers (i.e. the CISSS) to prepare themselves properly.
  2. Concomitantly with its coming into force: Once reorganized, the Regional Agencies and institutions will undoubtedly be obliged to establish the "optimization" measures announced by the MHSS and to rationalize their human resources (in this regard, sections 130 and 147 respectively provide for the power of the Minister, on the one hand, to prescribe rules for organizing the management structure of public institutions and measures to foster their improved organization and the sound management of their resources, and, on the other hand, the obligation for institutions to carry out an administrative reorganization within six (6) months of the coming into force of the first regulation adopted for that purpose). In the latter regard, the disappearance of a large number of senior management, senior administrative and support positions can be expected. Abolishing those positions will have to be carried out within the quite rigorous contractual and legislative constraints of the HSSN, where, in particular, the holding of consultations, etc. is required, where some rather elaborate bumping and job security-related processes will have to be applied.7 Implementing these "optimization" measures will therefore be complicated. In order to avoid matters become overly litigious, it will be essential that the reorganization be carried out according to a clearly defined and properly structured plan.
  3. In the months following its coming into force: The amalgamation of the Regional Agencies and institutions will entail a complete re-arrangement of the bargaining units within the HSSN8 and consequently will usher in a tumultuous period, in which the different unions concerned will argue over whom they represent.9 At the same time, the CISSS will be required to negotiate new collective agreements concerning certain subjects negotiated locally -- an exercise that will be rendered more complex by the need to harmonize working conditions on a regional basis and to manage, region by region, a pool of personnel that will be both larger and more geographically dispersed.

As at the date of drafting of this newsletter, Bill 10 was still at a very preliminary stage of the legislative process, although its projected coming into force date is April 1, 2015. The scope and real impact of the amendments proposed will, however, be confirmed only at the conclusion of the process launched on September 25.

Taking account of the importance of this Bill, special "enlarged" consultations have already been announced in the House on September 25 which were initiated on October 20. Any significant developments relating to this bill, with its major implications for Québec's HSSN, will be followed attentively by the members of BLG's Health Law Group and its Labour Law Group specializing in health-related matters. They will be in a position to keep you informed of the Bill's progress and to advise you about the coming changes.

In the long run, the implementation of Bill 10 will assuredly be followed by changes in the institutional cultures of the institutions affected, giving rise, in particular, to substantial challenges in the management of human resources. BLG's professionals, who have gone through many restructuring processes involving major HSSN institutions and several other large organizations in Québec, both public and private, will be pleased to assist you in responding to the many challenges heralded by Bill 10.


1 Bill 10, An Act to modify the organization and governance of the health and social services network, in particular by abolishing the regional agencies, 1st session, 41st Legislature, Québec, 2014 (introduced on September 25, 2014) [Bill 10].

2 RSQ c S-4.2 [AHSSS].

3 Moreover, that "exclusivity of functions", as well as the rules sanctioning non-compliance will henceforth be imposed on senior administrators and senior management officers of the HSSN, with only one exception, namely, that they may " carry out any mandate the Minister entrusts to them" (Bill 10, section 52).

4 And in particular by the Organization and Management of Institutions Regulation, RSQ, c S-5, r 5 (applicable to public institutions by virtue of section 619.41 AHSSS), the Regulation respecting the designation procedure for certain members of the board of directors of a public institution, RSQ, c S-4.2, r 21, and the Regulation respecting the election by the public of certain members of the board of directors of a public institution, RSQ, c S-4.2, r 11.

5 An Act respecting bargaining units in the social affairs sector and amending the Act respecting the process of negotiations of the collective agreements in the public and parapublic sectors, 1st session, 37th Legislature, Québec, 2003 (sanctioned December 18, 2013), SQ 2003, c 25.

6 For example, Bill 10 deals with the question of the application of the Charter of the French language, RSQ, c C-11, to the new CISSS (Bill 10, section 157). That having been said, the application of several other statutes is likely to be affected by this regrouping of employers.

7 Bill 10 provides that the regroupings will constitute "amalgamations" within the meaning of the AHSSS, and consequently, for the purposes of certain collective labour agreements, the Normes et pratiques de gestion – conditions de travail des personnes salariées syndicables mais non syndiquées and of the Regulation respecting certain terms of employment applicable to officers of agencies and health and social services institutions, RSQ, c S-4.2, r 5.1, it will be the rules on amalgamations of institutions that will be applied. Because those rules were not really designed for the regrouping of several major institutions, their application in this context may well pose various challenges.

8 On a strictly regional basis, the legislator has ensured, via section 108 of Bill 10, that the bargaining units will include only employees whose home base is in the same region. Applying that rule is likely to give rise to particular challenges in the Montreal region.

9 In this respect, Bill 10 refers to the Act respecting bargaining units in the social affairs sector, RSQ, c U-0.1 and, at its section 146, provides that the deemed date of the amalgamation will be 30 days after the date of the signing of national agreements. Since the collective agreements expire on March 31, 2015, and since Bill 10, in principle, is to come into force on April 1, 2015, it can be anticipated that, taking into account the time demands of the bargaining process, the amalgamations will actually take effect only in the following months.

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