Labour Code Reform

On May 15, 2001, Labour Minister Jean Rochon tabled Bill 31, An Act to amend the Labour Code, to establish the Commission des relations du travail and to amend other legislative provisions (the "Bill"), in the Quebec National Assembly.

The Bill makes some major structural changes in that it provides for the:

• abolition of the two-tiered decision-making system (labour commissioner and labour court) and its replacement by just one authority, the Commission des relations du travail (la "CRT");
• granting of new decision-making powers to the CRT comparable to those already vested with the Canada Labour Relations Board;
• transfer to the CRT of jurisdiction over recourses against unlawful and wrongful dismissals resulting from various Quebec statutes.

The Bill amends the current statutes by:

• enacting new rules applicable to processing certification applications;
• striking out the judicial sale exception under Section 45 of the Labour Code (the "Code");
• setting up a prior notice mechanism by the employer in the event of the sale or total or partial transfer of an undertaking;
• defining the terms and conditions surrounding the application of a partial transfer of an undertaking in Section 45.2 of the Code.

Furthermore, the Bill breaks new ground compared to the current statute by:

• obligating an employer to give the union prior notice of his intention to make changes to working methods that would cause some of his employees to lose the status of employee;
• implementing a mechanism allowing for CRT recognition and the transfer of certification and a collective agreement made under federal authority where the undertaking falls under provincial jurisdiction;
• empowering the CRT to order, only once during the bargaining period and at the request of the employer that a ballot vote be held under its supervision, allowing employees to vote on management's latest offer.

In setting up the CRT, the legislator's intention is to simplify and accelerate the processing of applications and proceedings set out in the Code and in some related statutes.

The acceleration in application processing will result in the elimination of proceedings brought before the Labour Court which, according to the Minister, add on average six months to the processing of files. Furthermore, in the case of certification petitions, the CRT’s decision must be rendered within 60 days of filing.

The CRT will have exclusive jurisdiction over any complaint, proceeding or application made pursuant to the provisions of the Code. Thus, the CRT will rule, in particular, on:

• petitions for certification and any other matter relating to the scope of the certification, including the question of knowing if a person is an employee or if this person is included in the bargaining unit (Secs. 25, 32 and 39 of the Code);
• complaints lodged pursuant to Sections 12 and 13 of the Code (interference in an association of employees or of employers);
• complaints for dismissal for union activities and other disciplinary measures or repraisals (Secs. 15 and following of the Code);
• pursuant to Section 20 of the Code, the determination of an indemnity payable to an employee dismissed or suspended without cause;
• any petition involving decertification (Sec. 41 of the Code);
• any request concerning the effects of the sale or partial or total transfer of an undertaking on the certification and collective agreement (Secs. 45, 45.1, 45.2, 45.3 and 46 of the Code);
• proceedings based on Sections 47.2 and following of the Code (lack of equitable representation by a certified association);
• the review or revocation of one of its decisions (old Section 49, new Section 128 of the Code).

The legislator also provided that the CRT would exercise the jurisdiction currently vested in the labour commissioner pursuant to various statutes. In this respect, the CRT will have jurisdiction to hear the complaints, applications and proceedings listed in Schedule I of the Bill, which, in particular, include the following proceedings:

• complaint for dismissal, suspension and illegal transfer pursuant to Sections 122 and 122.2 of the Labour Standards Act and complaint for dismissal without just and sufficient cause pursuant to Section 124 of the Labour Standards Act;
• complaint pursuant to Section 45 of the Charter of the French language (Chapter C-11) for dismissing, laying off, demoting or transferring an employee simply because he is exclusively French speaking and a complaint pursuant to the second paragraph of Section 46 because the employer, without any right, requires the knowledge of a language other than the official language;
• complaint for dismissal or removal of an executive pursuant to the Cities and Towns Act (Chapter C-19), the Municipal Code of Quebec (Chapter C-27.1) and various statutes governing the Quebec City and Montreal urban communities. All these complaints have fallen under the jurisdiction of the Labour Commissioner since December 20, 2000 further to the adoption of Bill 150 on municipal reform;
• proceedings against a suspension without pay or the dismissal of any municipal employee in default within the meaning of sub-paragraph 48g) of the Act respecting the Commission municipale (Chapter C-35);
• proceedings against a dismissal, suspension or transfer of an employee having asserted his rights pursuant to a decree under the first paragraph of Section 30.1 of the Act respecting collective agreement decrees (Chapter D-2);
• proceedings against a sanction imposed upon a municipal employee who is an election officer pursuant to Sections 88.1 and 356 of the Act respecting elections and referendums in municipalities (Chapter E-2.2);
• complaint for sanction taken against an employee in violation of the provisions of the Act respecting school elections (Chapter E-2.3);
• complaint for sanction against an employee in violation of the provisions of the Election Act (Chapter E-3.3);

In exercising its quasi-judicial powers, the CRT must allow the parties to be heard subject to three exceptions:

• in certification matters, where there is no disagreement on the description of the bargaining unit or whether or not certain persons are included in the bargaining unit;
• in certification matters, where the labour relations agent grants a certification pursuant to paragraphs d) or d.1) of Section 28 of the Labour Code;
• if it deems it appropriate and if the parties concur, it may proceed with the file.

The Bill gives broader powers to the CRT, in that:

• its decisions are final and binding and protected by a privative clause;
• it may summarily dismiss any application, complaint or procedure that it deems improper or dilatory;
• it may render any order, including a provisional order that it deems necessary to safeguard the rights of the parties;
• it may decide on any issue of law or fact necessary to exercise its jurisdiction and render any decision that it deems appropriate;
• it may ratify any conciliation agreement if it complies with applicable legislation, whether the Code or the Labour Standards Act or any other legislation falling under the jurisdiction of the CRT.

The Bill also grants the CRT broad powers with regard to a strike, slowdown, concerted action or actual or threatened lock-out. In fact, the CRT may, in such a case:

• order a person, group of persons, association or group of associations to cease performing, not to perform or to perform an act to be in compliance with the Code;
• require any person to redress any act or remedy any omission made in contravention of a provision of the Code;
• order a person or group of persons, in light of the conduct of the parties, to apply the measures of redress it considers the most appropriate;
• issue an order not to authorize or participate in or to cease authorizing or participating in a strike or slowdown within the meaning of Section 108 of the Code or a lock-out that is or would be contrary to the Code or to take measures that it considers appropriate to induce the persons represented by an association not to participate or to cease participating in such strike, slowdown or lock-out;
• order, where applicable, that the grievance arbitration procedure under a collective agreement be accelerated or modified.

The Bill further confers a certain number of inquiry powers upon persons designated by the president of the CRT. For inquiry purposes, these persons are vested with powers and immunity of commissioners appointed pursuant to the Act respecting public inquiry commissions ¹. They may, in particular, have access, at any reasonable time, at any place of work or establishment of a party to obtain information necessary to apply the Code.

CRT decisions will be final and binding. The decisions must be in writing and must be qualified. However, the Bill provides that the CRT may, upon application, review or revoke any decision or order it has made for reasons that are comparable to the retraction of judgments pursuant to the Code of Civil Procedure (that is to say, new facts, new evidence, a party could not be heard or a substantive or procedural defect likely to invalidate a decision).

The Bill initiates a certain number of mechanisms intended to facilitate the settlement of disputes and simplify the hearing of applications. To begin with, a conciliation mechanism is available to parties who agree to it. The content of the mediation is confidential and is not admissible into evidence. Furthermore, any agreement must be signed by the conciliator and by the parties. It may be subject to CRT approval at the request of one of the parties. Second, the commissioner to whom a matter is referred may call the parties to a pretrial conference, the purpose of which is stipulated in Section 137 of the Code.

The CRT will be headed by a president who will be assisted by two government-appointed vice-presidents. The other commissioners will be subject to the same appointment method. The president, vice-presidents and commissioners must all have knowledge of applicable legislation and ten years of relevant experience in matters falling under the jurisdiction of the CRT. However, the president and vice-presidents will be appointed after consultation with the most representative associations of employees and employers. The term of the office of the president and vice-presidents is at least five years. A commissioner’s mandate will be five years and it may be renewed for an additional five-year period. Furthermore, the CRT's president may appoint labour relations agents who will be responsible for verifying, among other things, the representative nature of an association of employees or its right to certification as well as the investigators responsible for conducting an inquiry on any manner falling under the jurisdiction of the CRT.

The goal of the proposed amendments is to grant more powers to the certification agent (the "certification agent") so as to accelerate the certification process. However, the basic criteria governing the right to certification (Section 21 of the Code) remains unchanged. As of the effective date of the Bill:

• the employer must post a copy of the petition for certification in a conspicuous place no latter than the business day following the date of its receipt. As before, he must also post the complete list of the undertaking's employees concerned by the petition within five days of receipt of the copy of the petition;
• the time period to contest the description of the bargaining unit is reduced from 15 to 10 days (Section 28 (c);
• the certification agent may certify a union even where there is no agreement on the description of the bargaining unit, if he concludes that the union maintained its majority notwithstanding the CRT decision on the description of the bargaining unit. The exercise of this power will considerably reduce the waiting periods between the filing and the granting of the certification petition;
• where a certified association already exists, or where there is more than one petitioning association of employees, if the certification agent ascertains that there is agreement on the bargaining unit between the employer and any association concerned, he may certify the association grouping the absolute majority of the employees or, if not, hold a secret ballot in accordance with the provisions of Section 37 of the Code and, consequently, certify the association that has received the greatest number of votes in accordance with the provisions of Section 37.1. If there is disagreement on the bargaining unit or on the persons to whom it applies, the certification agent will table a report on the disagreement with the CRT and send a copy to the parties;
• the CRT must render its decision within 60 days of the filing of the certification petition.

First of all, the exception pertaining to judicial sale is deleted from the text of Section 45, the effect of which will be to subject forced sales to the application of this section. These could include, among other things, certain sales by trustees in bankruptcy or by secured creditors.

Secondly, the legislator imposes the obligation upon the employer to send a prior notice of his intention to alienate or transfer the operation of all or part of his undertaking. This notice must be remitted to the association of employees which then has 90 days to apply to the CRT for a determination as to the application of Section 45. If the employer did not send any such notice, the union then has 270 days, from the knowledge of the alienation or transfer, as the case may be, to refer the matter to the CRT.

Thirdly, the legislator has just established a certain number of rules in the event of the partial transfer of the undertaking. The new rules provide that:

• where there is a special agreement on the transfer, the parties may elect not to apply to the CRT to request the application of Section 45 of the Code. Such a stipulation will bind the CRT. Notwithstanding the Ministry’s statements, this provision is ambiguous because, as a general rule, the parties to a sale are the buyer and the seller and not the union. Are we to deduce that the buyer and the seller may circumvent the application of Section 45 without the union’s consent? As the union must now be informed of any proposed partial transfer (Sec. 45.1), we must presume that it would probably apply to the CRT for a ruling on the legality of such a clause;
• in the event of a partial transfer, the collective agreement will end on the first of the following dates:

• the expiry of the collective agreement; or
• 12 months after the partial transfer date;

Furthermore, the legislator also amends Section 46 of the Code to clarify the CRT’s powers where it is seized with a petition pursuant to this section. In fact, several difficulties arose in the past, in particular, with regard to corporate mergers involving several associations of employees. Thus, the CRT may:

• grant or amend a certification;
• certify an association of employees highlighted by the application of Sections 45 and 45.3 of the Code after having verified the representative nature of this association by any means it deems expedient, in particular, by holding a secret ballot;
• describe or modify a bargaining unit;
• merge bargaining units and, where several collective agreements apply to employees of the new employer included in a bargaining unit resulting from the merger, determine the collective agreement that remains in force and make any modification or adaptation it considers necessary.

The legislator set up a mechanism allowing for provincial authority recognition of a certification granted under the Canada Labour Code. The collective agreement will be deemed to be a collective agreement concluded and filed pursuant to the Quebec Code. Likewise, pending proceedings will be deemed to be proceedings brought pursuant to the Code. The employer, or the new employer, as the case may be, will be bound by the collective agreement and the proceedings will continue pursuant to the Code.

An employer who intends to make changes to the undertaking’s operations that might result in a change in the status of one or more employees to that of a non-salaried contractor must first notify the certified association in writing. The notice must contain a description of the contemplated changes. The certified association that disagrees with the outcome of the proposed changes with regard to the status of employees may, within 30 days of receipt of the notice, apply to the CRT for a ruling on the consequences of these changes. Note that the employer cannot implement the changes before this 30-day period or before the CRT’s decision if the certified association sought its intervention. The CRT must render its decision within 60 days of the receipt of the request from the certified association.

The employer will now be able to ask the CRT to order the holding of a secret ballot to give a group of employees the opportunity to accept or reject the latest offers made by the employer on any matters forming the subject of a dispute between the parties. This vote, which will be held under the CRT’s supervision and within time frames that it will determine, will only be ordered once during the bargaining phase of a collective agreement.

Bill 31 was adopted and ratified on June 21, 2001. Some provisions of the Bill took effect in July 2001 while others will only come into force once the government enacts a decree in this respect. Both employer associations and unions objected to some aspects of the Bill. According to management, the government did not go far enough to facilitate recourse to outsourcing and fear possible union interference in the employer’s decision to use contractors. On the other hand, unions blame the government for not having given dependent contractors the opportunity to unionize and they object to the changes made to Section 45 regarding recourse to outsourcing in the event of the partial transfer of the undertaking. Notwithstanding the foregoing, the Bill, as it now stands, is expected to come into force.

1) R.S.Q. c. C-37