I recall being fascinated early on in my graduate studies in labour law to learn about “Export Processing Zones” (EPZ) that existed in many developing countries. These are geographical spaces within countries where designated laws that protect workers or the environment or that otherwise impose costs or just bother business folks are exempted. Crushing any possibility of workers in EPZ joining unions and engaging in collective bargaining was a fundamental objective of many governments that introduced EPZ, but guaranteeing very low wages, ignoring gender and racial discrimination and abuse, and restricting the application of annoying health and safety protections were (and still are) part and parcel of the EPZ economic growth strategy in many economically developing countries.
EPZs were what poor, developing countries did in a desperate attempt to attract investment in countries with few domestic economic prospects for job creation. Mexico’s maquiladoras were aimed at “sucking” jobs south from Canada and the United States by promises of low wages and lax regulations. The idea that a Canadian government would look at the use of the EPZ model in developing countries and decide, “YES! THAT IS EXACTLY WHAT WE NEED HERE!”, was not on my Bingo card.
What Does the Special Economic Zones Act Do?
The first thing to note is that the Act is a mere 9 sections long, and several of those sections are just legislative housekeeping and definitions. The true power of the law is squeezed into a few short sections.
[Probably my favourite is Section 7, which extinguishes ALL causes of actions by anyone adversely effected by anything done by the government under Bill 5, including any claims for loss revenues or profits. When I’m Premier, my first act will be enacting the Ending Tolls on Highway 407 to Eliminate the Need to Build Any More Highways in the GTA Act. That law will eliminate Highway 407 tolls and incorporate Bill 5’s Section 7 to prevent lawsuits against the government for lost toll revenues. But I digress].
· Section 2 of Bill 5 grants authority to Cabinet to “designate an area of the province as a special economic zone.” We know that the Tories intend to declare the so-called Ring of Fire region in northern Ontario as a special economic zone so they can rush through mining projects. But the law permits Cabinet to declare any place a special economic zone. Toronto, for example.
· Section 4 grants Cabinet authority to designate any “project” or “class of projects” as designated project(s). Therefore, the law applies to both geographic “areas” and “projects” designated by the government.
Now things get crazy. Section 5 grants authority to Cabinet to exempt any designated project in a designated zone from any “requirements under provisions of an Act or regulation.” For example, the law permits Doug Ford to declare “Northern Ontario” a “special economic zone” and all mining there a “designated project”. Once those steps are taken, he can with the stroke of pen (a regulation), declare that the Employment Standards Act doesn’t apply to mining projects in the Northern Ontario. Section 6 makes clear that government can also just “modify” the application of some parts of legislation to a designated project, so rather than exempt the entirety of ESA, Doug Ford could just declare that overtime and hours of work laws don’t apply to the project. So fun!
What About the Charter of Rights and Freedoms?
Now, in theory, there are still some limits on Cabinet’s power to just brush aside whatever law it wants. We still have a Charter of Rights and Freedoms, and Bill 5 does not, YET, include a “notwithstanding clause” provision that would permit Cabinet to override fundamental human rights. I say “yet” because the Tories could always circle back and invoke the notwithstanding clause later and they have already shown a willingness to trample over Charter rights and freedoms by using this clause on several occasions. It would be naïve to dismiss the possibility that the Tories would use the notwithstanding clause again under the guise of responding to an “economic emergency.”
However, for now, the use of Bill 5 to override statutory collective bargaining protections could (and likely would) be challenged by unions as a violation of freedom of association. Whether a Charter challenge would succeed is not obvious in the abstract. We need more facts. For example, imagine the Tories designate all mining projects in the Ring of Fire and then introduce a regulation declaring that the Labour Relations Act (or parts of it) does not apply to those projects. Is that a violation of freedom of association under Section 2(d) of the Charter? Does the Charter require that workers employed in the designated area be covered by the Labour Relations Act?
These are the sorts of questions that the Supreme Court of Canada has wrestled with in cases like Dunmore, Fraser, and Société des casinos du Québec inc. They raise the fundamental question of whether governments have a constitutional duty to enact and extend statutory collective bargaining provisions to all workers. A fun labour law class question is whether governments could just repeal all collective bargaining legislation and, if so, what happens then. Maybe Bill 5 is a first step to exploring this possibility in peace meal form. We have templates to assist the Tories. Look at Sections 73.1 of the Ontario Works Act, 1997 (a lovely piece of legislation introduced by the Mike Harris led Conservatives), which states simply that “the Labour Relations Act does not apply” to workers participating in “workfare” (and states further that these workers do not have a right to join a trade union, to engage in collective bargaining, or to strike).
There would also be presumptive limitations on the ability of the Tories to override human rights legislation under Bill 5 powers, because Section 15 of the Charter protects equality rights. For example, a Bill 5 regulation declaring that Section 5 of the Ontario Human Rights Code does not apply to work performed in a designated zone would surely be met with a Section 15 Charter challenge.
However, there is nothing in the Charter that prevents the Tories from using Bill 5 to override worker protection statutes that do not engage collective bargaining and equality rights. For example, employment standards or health and safety legislation can be waived in whole or part in a designated area. The fact that some workers are covered by labour standards protections but not others does not violate the Charter, at least the courts have not found so to date.
At this point, there is no clear indication of whether the Tories intend to use Bill 5 powers to override labour protections as an economic growth strategy. Maybe the intention is “only” to trample over environment and Indigenous rights! I suspect that stripping labour protections is a risky political strategy because Canadians aren’t likely to take kindly to the idea that Canada should compete based on weak labour protections. But who really knows with these guys. The Tories certainly don’t seem bother by the big protests by Indigenous and environmental groups that are no doubt in our future. Maybe the labour movement and workers advocates will be out there too. One thing is clear, other Canadian governments are watching the Bill 5 “special economic zone” experiment closely. It may provide a road-map for undermining all sorts of legislative protections moving forward. Fun times indeed.