Canada: RockTenn Sets Aside Bowater Maritime: End Of Active Employment In The Context Of Plant Closures In Quebec

On February 16, 2015, arbitrator Denis Provençal issued an important decision1 affecting pension plans in Quebec. He found that the active employment of employees affected by a plant closure ends on the day the plant closes permanently. This decision sets aside previous rulings of the New Brunswick courts,2 including that province's Court of Appeal, which had determined that active employment for such employees continues until the end of their recall privileges.


On February 29, 2012, RockTenn announced that it was permanently closing its Matane plant. In April 2012, the union and the employer signed a permanent closure agreement. In accordance with this agreement, all employees were paid a few weeks' notice and their pensions were calculated. Inventories and raw materials on the site were sold, and the plant equipment was partly dismantled. Some parts were sent to other plants, and the paper-machine boilers were pierced so that cardboard could no longer be produced at the Matane location.


In April 2014, three plant employees, two of whom continued working after February 29 to ensure an orderly closure, filed grievances claiming the benefit of an early retirement, pursuant to the plan in place. They argued that they had already accumulated 20 years of service when the plant closed and had reached the age of 55 during the period covered by their recall privileges set out in the applicable collective agreement. The employees claimed that they had continued to be actively at work until the expiry of their recall privileges – in this instance, a period of 36 months after their last day of work.


The union argued that under the collective agreement, employees lost their seniority only if they had not been hired back after being on layoff for more than 36 consecutive months. Again according to the union, in view of such recall privileges providing that an employee has the right "[translation] to be rehired as jobs open up," a layoff could only become a termination, and thus end active employment, after the 36-month period had expired. Employees who turned 55 during the 36-month period following the plant closure should therefore be considered as having been actively at work on their birthday and thus eligible for early retirement. This was the position taken by arbitrator Brian Bruce in a decision involving a pension plan that was substantially identical to RockTenn's3 – a decision that was subsequently upheld by both the Court of Queen's Bench (superior court)4 and the Court of Appeal5 of New Brunswick, giving it significant precedential value.

The employer argued that, in Quebec, an employee's active employment should end when it has become clear that there is no possibility of a return to work. In this case, because the end of work for the employees was permanent, it could in no way be considered a layoff, in whatever form, giving rise to recall privileges, as their active employment ended in 2012.

The decision

The arbitrator begins by noting that the February 2012 closure was permanent, leaving the employees with no hope of being called back to work. It therefore remained to be determined whether, as a result of having turned 55 during their recall period, they could receive the pension benefits they were seeking.

Upon reviewing the relevant wording of the collective agreement, the pension plan and the Supplemental Pension Plans Act6 (SPPA), the arbitrator states that he cannot ignore applicable Quebec law and consequently draws on sections 36 and 54 of the SPPA and its interpretation by the Quebec courts7 to conclude that "[translation] [...] it is the real possibility of a return to work and not simply the existence of recall privileges that must be considered in determining whether the three employees are correct in claiming that they were continuing their active employment at RockTenn."8 He also points out that it is necessary to consider the situation as a whole "[translation] [...] to determine if the closure was a permanent closure and whether the recall privileges provided for in the collective agreement, the SPPA and a pension plan became theoretical and whether they can be exercised."9

Addressing an additional argument from the union that the sale of the plant could have given rise to the application of section 45 of the Labour Code,10 which would have bound the acquirer to comply with the recall privilege provisions of the collective agreement, the arbitrator, noting that there was no evidence of a possible resumption of operations, states that "[translation] in Boucher, the T.A.Q. (the Administrative Tribunal of Quebec) ruled that the Régie des rentes du Québec (Quebec's pension board) could not rely on subsequent events to identify a new possibility of a return to work."11

The arbitrator, finding that the three employees had no real and reasonable possibility of being recalled after their last day of work at the Matane plant, therefore dismissed the three grievances.


This decision has the merit of clearly rejecting the principles adopted by the New Brunswick courts, which had raised serious doubts among employers and pension plan administrators since 2008. It serves as a reminder of how important the events surrounding a business closure decision are, underscoring the need for employers to act in a manner consistent with a closure decision by, among other things, settling all the details with the unions, paying the amounts due to the affected employees and making sure there is no longer any real possibility for them to return to work. Otherwise, the door will always be open to employees claiming that they were actively at work during the recall period provided for in their agreement.

An application for judicial review has been filed concerning this decision. We will keep you up to date on any developments.


1. Unifor Section Locale 414 v Emballages RockTenn, 2015 Can LII 6880 (QC SAT).

2. Bowater Maritime Inc. v Communication, Energy and Paperworkers Union, Locals 117, 146, 164 and 263 and International Longshoreman's Association, Local 1433, [2011] NBJ No 69.

3. Communication, Energy and Paperworkers Union, Locals 117, 146, 164 and 263 and International Longshoreman's Association v Bowater Maritime Inc., Local 1433, Brian D. Bruce, QC Arbitrator, December 15, 2008.

4. Bowater Maritimes Inc. v Communication, Energy and Paperworkers Union, Locals 117, 146, 164 and 263 and International Longshoreman's Association, Local 1433, [2010] NBJ No 121.

5. Supra note 2.

6. CQLR c R -15.1.

7. Bowater Pâtes et papier Canada c Régie des rentes du Québec et Claude Boucher, SAE-M-051464-9908, August 28, 2000, Tribunal administratif du Québec AZ-50079293; Boucher c Tribunal administratif du Québec [2002] RJQ 2785.

8. Supra note 1 at para 56.

9. Ibid at para 57.

10. CQLR c C-27.

11. Supra note 1 at para 61.

Norton Rose Fulbright Canada LLP

Norton Rose Fulbright is a global legal practice. We provide the world's pre-eminent corporations and financial institutions with a full business law service. We have more than 3800 lawyers based in over 50 cities across Europe, the United States, Canada, Latin America, Asia, Australia, Africa, the Middle East and Central Asia.

Recognized for our industry focus, we are strong across all the key industry sectors: financial institutions; energy; infrastructure, mining and commodities; transport; technology and innovation; and life sciences and healthcare.

Wherever we are, we operate in accordance with our global business principles of quality, unity and integrity. We aim to provide the highest possible standard of legal service in each of our offices and to maintain that level of quality at every point of contact.

Norton Rose Fulbright LLP, Norton Rose Fulbright Australia, Norton Rose Fulbright Canada LLP, Norton Rose Fulbright South Africa (incorporated as Deneys Reitz Inc) and Fulbright & Jaworski LLP, each of which is a separate legal entity, are members ('the Norton Rose Fulbright members') of Norton Rose Fulbright Verein, a Swiss Verein. Norton Rose Fulbright Verein helps coordinate the activities of the Norton Rose Fulbright members but does not itself provide legal services to clients.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.