By David Doorey (York University) and Sandrine Haentjens (University of Toronto)
In early October 2011, Conservative Minister of Labour (MOL) Lisa Raitt was seriously fed up with Air Canada flight attendants. Twice a proposed collective agreement had been put before them and twice they had voted it down in ratification votes. She questioned whether something was wrong with the Canada Labour Code such that this could happen. She was considering legislative reforms.
The usual next move for the Stephen Harper Conservative government was to introduce back-to-work legislation as it had done on many other occasions, including for workers at Air Canada. However, parliament was in recess for another week, and it would be a pain to recall the MP’s early and deal with the annoying NDP, which would no doubt engage in its usual futile attempt to block the legislation. So, Lisa Raitt and her advisors came up with an ingenious plan.
They zeroed in on Section 87.4(5) of the Code, which permits the MOL to refer to the CIRB a question of whether parties engaged in a labour dispute had properly ensured that the health and safety of Canadians was being protected by continuation of essential services. The purpose of bringing this reference was clear: Section 89(1)(e) of the Code required that any work stoppage be suspended until such time as the CIRB dealt with a MOL’s referral. Therefore, the referral would mean that no strike could occur before the House was back in a week and, if necessary, back-to-work legislation could be passed then. Of course, to rely on Section 87.4, the Conservatives had to pretend that Air Canada provides an essential service without which serious and immediate harm would befall Canadians. This was nonsense, but it didn’t matter– simply by making the claim, the Conservatives would block a strike by flight attendants, as explained in this Law of Work blog post from 2011.
Less noticed at the time, MOL Raitt also sent a second referral to the CIRB, this one under Section 107 of the Code, which has been in the news lately for reasons explained shortly. Section 107 reads as follows:
The Minister, where the Minister deems it expedient, may do such things as to the Minister seem likely to maintain or secure industrial peace and to promote conditions favourable to the settlement of industrial disputes or differences and to those ends the Minister may refer any question to the Board or direct the Board to do such things as the Minister deems necessary.
The purpose of the second reference was to ask the CIRB to consider what if anything could be done in a situation in which a bargaining unit votes down a recommended collective agreement twice. The reference also then “directed” the Board to “either impose a new collective agreement or impose final binding arbitration” if it concluded that the rejection of two tentative agreements recommended by the union “created conditions that are unfavourable to the settlement” of the dispute. Ultimately, the parties agreed to refer the outstanding issues to binding arbitration, so the CIRB did not need to deal with the merits of either reference.
The power granting a Minister to “direct” the CIRB to do things to secure industrial peace in s. 107 has been in the Code since 1984. However, the 2011 MOL reference marked the first time a government had floated the possibility of using s. 107 to “direct” the CIRB to end a work stoppage by imposing arbitration. Notably though, MOL Raitt and the Stephen Harper government, as anti-union a government as you will find in Canada, never contemplated that s. 107 empowered a MOL to override statutory and constitutional rights, and the independence of the CIRB, by sending a simple email to the CIRB ordering it to suspend those rights immediately.
The 2011 “direction” to the CIRB to impose arbitration was prefaced by an instruction to first investigate whether the rejection of two recommended settlements had effectively made ratification of a new agreement impossible. If so, the CIRB was directed to resolve the bargaining dispute. This summer, when asked about the Liberals new-found love of s. 107 to override the right to strike, Lisa Raitt was bemused: “If you find a lawyer who can tell you that it’s possible [for the minister to order the parties into arbitration], then I wish I had their advice 15 years ago. But as far as I’m concerned, you aren’t able to do that.” (H/T labour lawyer Lyle Skinner for referring me the story with that quote).
The Liberals Expansive Use of Section 107
The Harper government is long gone, and the more “labour friendly” Trudeau Liberals are hanging onto to power by a thread, dependent on support from the NDP, the Bloc, or even the Conservatives for survival. As it happens, 2024 proved to be a tumultuous year for labour strife in federally regulated industries, including air travel, rail services, Canadian ports, and most recently, the postal service.
In late June, mechanics at Westjet represented by the Aircraft Mechanics Fraternal Association (AMFA) were set to strike when news surfaced that MOL Seamus O’Regan had “averted” a Westjet strike by “directing the CIRB to impose final binding arbitration.” This news was met with a collective raised eyebrow within the labour law community. What do you mean, the MOL directed the labour board to impose arbitration? Governments frequently pass back-to-work legislation in parliament that impose arbitration, after going through the democratic process and legislative debate, but how can a MOL just impose arbitration on his own, willy-nilly?
It took some time to sort out that the MOL had dusted off the Conservatives’ old idea of using s. 107 to engage the CIRB in trying to end a work stoppage. The MOL sent a s. 107 referral to the CIRB directing it to “assist the parties in reaching a settlement of their first collective agreement by imposing final binding arbitration to resolve outstanding terms […].” The CIRB heard submissions from the parties about what the referral meant and ultimately decided to refer the dispute to arbitration as directed. However, it permitted the strike to continue until that arbitration process commenced. That decision is explained in this post.
Once Westjet realized that the strike would not end immediately, it returned to the table and a quick settlement was reached. However, the Liberals were furious that the CIRB had not blocked the right of mechanics to strike upon receiving the s. 107 referral given that the clear intention of the MOL was that the strike be prohibited, even if the language used was not explicit in this respect. Therefore, the problem in the Westjet case, the Liberals reasoned, was not that s. 107 does not permit the MOL to order the CIRB to disregard statutory and constitutional rights, but that the wording of the s. 107 referral in that case was sloppy. The Liberals would not make that mistake again.
And so, when the Liberals decided to use s. 107 to end a lockout (and potential strike) involving two railway companies in October, the Liberals fixed the language. This time, the referral very clearly “directed” the CIRB to order the parties to “resume operations” and “impose interest arbitration.” No question was put to the Board as an antecedent to imposing arbitration, as in the 2011 Air Canada case: this was simply the MOL, on his own initiative, ordering the CIRB to end a work stoppage.
The CIRB noted that the use of s. 107 in this manner was unprecedented, but it concluded that “it does not have the authority to review the Minister’s directions or to assess their validity.” The CIRB ruled that any challenge to the Minister’s order, including any argument that the referral violates the Charter or is inconsistent with “Charter values,” must be decided by the federal court. The CIRB therefore ordered the railway work stoppages to end, and it referred the dispute to arbitration. The Teamsters’ Union has launched a challenge in federal court against both the Minister’s Section 107 referral and the CIRB’s decision. No doubt similar challenges will be filed by other unions effected by subsequent s. 107 orders banning strikes and eventually the courts will decide the legality of the Liberal’s referrals and the scope of s. 107.
With the decision in the railway dispute case, the capitulation of the CIRB to the whim of a sitting MOL was complete. The CIRB ruled, in effect, that s. 107 was surreptitiously slipped into the Code in 1984 to introduce a poison pill permitting a MOL to override the Code and even the Charter, subject only to a federal court reviewing the MOL’s referral later on. On this interpretation, s. 107 anoints the MOL King of Labour Rights, lord over the CIRB and the Code, at least until a court says otherwise.
Section 107 Anoints the Minister of Labour “King of Labour Law”
Let’s pause to follow this reasoning to its glorious, logical conclusion. A MOL could direct the CIRB to ban all strikes and lockouts in the federal sector, or even to prohibit workers from unionizing at all. In theory, either of these directions could be justified as “promoting industrial peace.” But it cuts both ways. A MOL could now use s.107 to ban replacement workers and captive audience meetings, for example. Both of those employer practices undermine labour peace by infuriating workers and raising tensions at work. Or imagine that non-union workers have commenced an “recognition strike” to pressure their employer to bargain with their chosen union. Recognition strikes are illegal under the Code, but never mind that detail; as MOL, I could order the CIRB to direct the employer to recognize the union (by-passing the union certification process in the Code) and refer the setting of a first collective agreement to binding arbitration. That would bring an end to the strike, thereby promoting industrial peace in that workplace. It could be so much fun being MOL if we could use s. 107 to override the Code whenever it suits us!
Of course, nobody believes that s. 107 was intended to give a MOL unrestrained power to essentially rewrite the Code however they “deem necessary”. That would be absurd. Yet, that is the clear outcome of the Liberal’s unprecedented use of s. 107 over the past few months. It doesn’t matter whether anyone agrees with the MOL’s opinion about what is “necessary” to promote labour peace. The CIRB is powerless to refuse to do what the MOL directs. Full stop.
Armed with absolute authority to end all work stoppages in the federal sector, it came as no surprise when the Liberals once again used s. 107 to end strikes and lockouts at ports in Vancouver, Quebec City, and Montreal last week. However, it is important to note that the Liberals were content to permit a 2 years-long lockout of port workers in Quebec City, while the Société des Arrimeurs de Québec (SAQ) used replacement workers to operate the ports. The Liberals passed anti-scab legislation in 2023 (Bill C-58), but inexplicably delayed the effective date of the legislation until 2025, ensuring that SAQ could continue its lockout and use of replacement workers. It took escalating strikes at ports in Vancouver and Montreal for the MOL to send the s. 107 referral to end the work stoppages.
This selective response to intervention in work stoppages leaves the Liberals open to criticism that s. 107 is used selectively, whenever workers have power and a strike could actually be effective. This concern for real and perceived bias was noted expressly by the influential Woods Task Force in 1968 as a reason to avoid granting MOLs authority to intervene in an ad hoc manner to end work stoppages. The Task Force emphasized “the danger of political pressures or accusations of partiality that may jeopardize the settlement of disputes when they arise.”
On that note, will anyone be surprised if s. 107 is used again to end the ongoing work stoppage at Canada Post, which unquestionably comes at a very bad time for Canadian business and therefore when the workers have considerable leverage? Several days into the strike, MOL Steven MacKinnon is insisting that there are no plans to intervene “right now.” However, federal sector employers now expect the MOL to use the newly discovered s. 107 referral to rescue them when workers could inflict economic harm through a work stoppage. Already, Canadian businesses are lining up to demand the MOL intervene and force arbitration. Canada Post can reasonably expect the Liberals to do just that given the government’s recent record.
We can’t say for sure that the expectation of government intervention is affecting how employers negotiate, but it would be naïve to believe that it doesn’t cause them to hold back on tabling their best offers. This is basic labour relations. Don’t show all your cards if you expect that the dispute is heading to arbitration. Therefore, the Liberals’ surprising and aggressive use of s. 107 to thwart the right to strike this year could have lasting impact on collective bargaining. In labour relations, nothing happens in a vacuum.
Litigation challenging the Liberals’ unprecedented use of s. 107 to thwart the constitutional right to strike and override other statutory rights will eventually provide some guidance on this political strategy moving forward. Obviously, a MOL acting alone cannot trample Charter rights through the backdoor of a s. 107 referral any more than a government can do so through the traditional route of back-to-work legislation prohibiting strikes. However, at least the latter approach respects the democratic process while preserving the independence and expertise of labour relations boards.
On the other hand, if the courts uphold the use of s. 107 by MOLs to override labour rights on a willy-nilly, ad hoc basis, expect provincial governments wishing to bypass parliament in dealing with labour disputes to introduce similar poison pill provisions into provincial labour legislation. Such a transfer of statutory enforcement from independent labour tribunals to the sole discretion of sitting MOL’s will not be received kindly within the Canadian labour movement. The irony is that in their purported pursuit of “labour peace” through its expansive use of s. 107 to override labour rights, the federal Liberals may have planted the seeds of conflict for years to come.
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