Legal — 10

In November, 2003, during the Air Canada CCAA process, the Senate Committee conducting the legislative review released its report entitled Debtors and Creditors Sharing the Burden: A Review of the Bankruptcy and Insolvency Act and the Companies Creditors Arrangement Act. Of key interest to unions and employees are the following three recommendations in this report:

1) Debtor companies should be permitted to “disclaim” collective agreements where they can establish that postfiling negotiations have been carried on in good faith, for relief of too onerous aspects of the collective agreement and where they can show that this is necessary to allow for a viable restructuring. This recommendation is directly contrary to the position taken by organized labour that the current legislation should stand, since unions and debtor companies are in the best position to negotiate the compromise that is necessary to preserve the company as a going concern.

2) Claims for unpaid wages and vacation pay should receive super-priority (over secured claims to inventory and accounts receivable) to a limit of $2,000 CAD or one pay period per employee. This recommendation was in response to submissions that the current regime fails to adequately protect employees. However it falls well short of what organized labour had sought, namely a super-priority for up to $20,000, covering severance and termination pay under the definition of wages, and a federal wage protection program to cover amounts not paid out in the bankruptcy.

3) No amendments should be made to the legislation to alter the treatment of pension plans. Organized labour had sought the introduction of a federal insurance program to protect pension benefits, among other matters.

This Senate review has not yet gone before Parliament, and so it is not yet known what, if any, changes may be made to Canadian insolvency legislation.What is certain, however, is that the government’s ultimate analysis of the success and/or failure of the Air Canada bankruptcy will be enormously influential in directing the future course of the insolvency law in Canada as it relates to employees and collective agreements.

Labour Relations Law
In the 2001 case of Dunmore v. Ontario (Attorney General), the Supreme Court of Canada found that an Ontario law excluding agricultural workers from access to the protections of the Labour Relations Act violated section 2(d) of the Charter, i.e., workers’ right to freedom of association.While the Court noted the important role that unions play in a democracy, it did not go so far as to require governments to compel employers to collectively bargain with such unions.

Pay Equity
In May, 2003, a landmark Court settlement resulted in the Ontario Government agreeing to pay up to $414 million in pay equity adjustments to over 100,000 unionized and nonunionized women working in over 2,300 child care centres, nursing homes, community and home care agencies. This settlement resulted from an April, 2001 Court challenge brought under the Canadian Charter of Rights and Freedoms Charter by 5 unions and 4 individual women workers. This action claimed that the Ontario Government’s 1998 decision to end public sector pay equity funding was unlawful gender discrimination.

On June 26, 2003, the Supreme Court of Canada released its decision in the Communications, Energy and Paperworkers Union v. Bell Canada appeal. This appeal is part of the decades long litigation between Bell and its female employees over pay equity. The Court unanimously rejected all the arguments of Bell Canada, which had challenged the right of the Canadian Human Rights Tribunal to proceed with hearing the case into Bell’s alleged violation of the equal pay provisions of the cCanadian Human Rights Act.

Adopting many arguments made by the Canadian Labour Congress, the Court upheld, among other matters, the power of the Canadian Human Rights Commission to make pay equity guidelines that must be enforced by the Tribunal. The matter is now proceeding again before the Canadian Human Rights Tribunal.

Anti-Discrimination Law
Court, human rights and arbitration decisions continue to deal with the important issue of the duty to accommodate groups seeking equality, such as women workers and workers with disabilities. Decisions applying the precedent setting 1999 Supreme Court of Canada decision, British Columbia (Public Service Employee Relations Commission) v. BC Government and Service Employees Union. (“Meiorin”) [1999] 3 S.C.R 3 have covered a wide and unforeseen variety of factual situations. This has included complainants as diverse as those involving transsexuals in federal penitentiaries, nannies working in a private residence, deaf individuals complaining of closed captioning television, professional workers on stress leave, clerical workers suffering from depression and theatre-goers with mobility- related disabilities. The duty to accommodate applies to unions both in their collective agreement role as representing workers and also in their role as providing services to their members. Adjudicators have held employers to a high onus of showing that a requested accommodation would cause “undue hardship.” They have refused to accept impressionistic evidence and have put the onus on employers, trade unions and service providers to fully investigate all alternative and creative ways to accommodate complaints.

In the case of McKinnon and Ontario Human Rights Commission v. Ontario (Ministry of Correctional Services) et al., a Board of Inquiry dealing with the failure of an employer to protect a worker from racist conduct ordered an employer to carry out a number of systemic remedies to cleanse the workplace environment. In deciding whether to make such a systemic remedial order, the Board considered factors including the following: the promptness of the institutional response to the complaint; the seriousness with which the complaint was treated; procedures in place at the time to deal with discrimination and harassment; resources made available to deal with the complaint; whether the institution took the complaint seriously and then provided a healthy work environment for the complainant; and the degree to which action taken was communicated to the complainant.