Report in which the committee requests to be kept informed of development - Report No 234, June 1984

Case No 1235 (Canada) - Complaint date: 22-SEP-83 - Closed

1. 316. The Canadian Labour Congress (CLC) presented a complaint of violations of trade union rights in a communication dated 22 September 1983. The Government supplied its observations in a communication dated 17 April 1984.
2. 317. Canada has ratified the Freedom of Association and Protection of the Right to Organise Convention, 1948 (No. 87); it has not ratified the Right to Organise and Collective Bargaining Convention, 1949 (No. 98) or the Labour Relations (Public Service) Convention, 1978 (No. 151).

A. The complainant's allegations

1. 318. In its communication of 22 September 1983, the CLC alleges that the Government of British Columbia has infringed Conventions Nos. 87, 98 and 151 by introducing, on 7 July 1983, five legislative texts which seriously threaten the collective bargaining rights of all unionists in the province; the texts are Bill 2 (The Public Service Labour Relations Amendment Act), Bill 3 (The Public Sector Restraint Act), Bill 11 (The Compensation Stabilisation Amendment Act) and Bill 26 (The Employment Standards Amendment Act).
2. 319. First, the CLC alleges that section 13 of Bill 2 violates Articles 3, 8 and 10 of Convention No. 87. Under section 13, "no collective agreement shall affect the powers and duties of the public service commission ... respecting the recruitment or employment of employees to the public service ... any matter included under the Pension (Public Service) Act, the organisation, establishment and administration of the ministries and branches of the government, including the right of the government to establish and eliminate positions, to assign duties to positions, to establish work scheduling and to determine programmes and services and the method of their delivery, the right of the Government to establish and administer systems of job evaluation and classification, and the procedures and methods of training or retraining all employees ... Any provision in an collective agreement that is expressed to affect any of the matters referred to above is without effect". According to the complainant, the negotiation of a collective agreement is a significant aspect of the activities of a union and it points out that the Committee on Freedom of Association has decided on numerous occasions that conditions of employment should not be regarded as outside the scope of collective bargaining, only those matters which clearly appertain primarily or essentially to the management and operation of government business can be so excluded. The CLC points outs that section 13's prohibition on the negotiation of many of the terms and conditions of employment affects not only provincial public employees but also semi-public employees. Moreover, in view of the fact that there is no definition of what shall constitute "the organisation, establishment and administration of the ministries and branches of government", possibly all working conditions even if primarily related to an individual employee could be excluded from a collective agreement. The CLC also considers that this section violates Articles 4 and 6 of Convention No. 98 and Articles 7 and 8 of Convention No. 151 since the exclusion of public servants engaged in the administration of the state under Article 6 has been held by the ILO supervisory bodies to cover those whose functions are directly engaged in the administration of the state, for example deputy-ministers and their administrators. Since Convention No. 151 is considered as supplementary to Convention No. 98, the CLC argues that Bill 2 violates both Conventions. In this connection, the CLC alleges that Bill 2 does not allow public service employees to participate in the determination of their terms and conditions of work and does not create a fair mechanism to settle disputes arising from disagreement over the terms and conditions of employment.
3. 320. Secondly, the CLC alleges that the original draft of Bill 3 gave the employer the right to dismiss any employee without cause, but due to public outcry this wide power was amended to remove the without cause condition and to introduce widely defined reasons for termination. According to the CLC the new wording still provides virtually unlimited scope of power to dismiss employees, irrespective of length of service, employment functions or qualifications. In particular the CLC points out that section 1 of Bill 3 defines termination to include lay-off, this change allowing an employer to ignore lay-off and recall provisions in a collective agreement. Section 2 reads as follows: "where a public sector employer considers that there is insufficient current work, or are insufficient operating funds budgeted to maintain current levels of employment, makes a change in the organisational structure of the employer, discontinues a programme, activity or service of the employer or reduces the level of an activity or service of the employer, it may terminate the employment of an employee in accordance with the regulations". The CLC considers that the broad powers to dismiss due to a change in the organisational structure of the employer is particularly onerous and subject to abuse. The CLC points out that any disagreement with a unilateral management decision in this respect would require recourse to the least accessible and most expensive tribunal - the courts - before which the dismissed employees may have to wait up to two years for review of their terminations. Moreover, the CLC alleges that new subsection 3 of section 2, by providing that the Act shall supersede collective agreements whose dismissal provisions conflict with the Act, ensures that the Act will supersede virtually every collective agreement in the public sector. It points out that the exemption section (new section 2.]) does not permit a collective agreement to prevail, but leaves the decision to the Compensation Stabilisation Commissioner (a government appointee who is responsible for the administration of the Compensation Stabilisation Act) and not the parties to the collective agreement. Section 2.] reads as follows: "where a written contract of employment or collective agreement contains provisions that enable a public sector employer to terminate the employment of employees in the circumstances described in section 2 (1), provide fair and equitable procedures which are consistent with efficient management by which those terminations of employment will be implemented, and provide fair and equitable compensation to be paid to those employees whose employment has been terminated, the Compensation Stabilisation Commissioner ... may, on the application of a party to that contract or agreement, order that section 2 (1), (3) and (5) does not apply to the parties to that contract or agreement". The commissioner may impose any conditions he considers necessary in respect of an order made under this section and reconsider and revoke, amend or vary any order he has made. According to CLC, these criteria for exemption are so wide that no collective agreement is likely to meet the commissioner's requirements, and seniority and lay-off and recall provisions can be overruled if they are, in the commissioner's view alone, inconsistent "with efficient management".
   • The CLC states that Bill 3 violates Articles 3, 8 and 10 of Convention No. 87 since workers' organisations are prevented from negotiating clauses which protect their members against discrimination and dismissal, and they threaten their ability to represent the members.
   • It also considers that this Act violates Article 4 of Convention No. 98 and Articles 7 and 8 of Convention No. 131 since it does not allow any clauses in collective agreements which relate to dismissal seniority rights, lay-off and recall rights or any other protection which concerns separation from work which would conflict with the Act. This nullifies any concept of voluntary negotiations between employers and employees and denies the right of workers to participate in the determination of their conditions of employment. Moreover, the CLC points out that the Act does not provide for the establishment of an independent mechanism to settle disputes arising from a termination.
4. 321. Thirdly, the CLC alleges that Bill 11 violates Convention No. 87, Article 4 of Convention No. 98 and Articles 7 and 8 of Convention No. 151 since it limits any change in any form of compensation to certain strict minimums, even if the compensation levels had been decided by an independent dispute mechanism such as an arbitration board. According to the CLC, Bill 11 also ensures that there will be no pay rises without increases in productivity, a subjective concept which, for the Government, implies longer working hours. The CLC points out that section 1 of the Act severely limits the authority of independent arbitration boards by requiring them to make initial awards within the guide-lines and regulations laid down by the Act. It also alleges that section 2.] (which reads. "the purpose of this Act is to establish a programme that will encourage productivity and restrain and stabilise compensation in the public sector while ensuing that the paramount consideration for determining compensation is the public sector employers ability to pay") severely limits if not destroys the collective bargaining rights of public sector employees in the Province. In this connection, the CLC refers to new section 12.] which reads as follows: "in reaching or establishing a compensation plan for public sector employees, the parties to the plan or the public sector employer or arbitrator establishing the plan shall give paramount consideration to the ability of the public sector employer to pay that compensation". The CLC point out in particular that this Bill is now permanent. While noting that under section 17 the Compensation Stabilisation Commissioner is empowered to introduce reductions in wages, the complainant points out that regulations have been issued imposing settlements of minus 5 per cent to plus 5 per cent; it observes that under new section 24.] a decision or order made by the commissioner is final and binding. As regards the Government guide-lines and regulations authorised under Bill 11, the CLC points out that public sector unions in British Columbia are socially and economically responsible and do recognise the difficult times confronting the Province. It claims that the Government has refused to take note of the union's efforts to take account of the economic situation in voluntary negotiations. Again the CLC concludes its comments on this Act by stating that the imposition of settlements on public sector employees results in a denial of their right to participate in determining the terms and conditions of their employment and removes the freedom of arbitrators to make fair and just settlements based upon the evidence received, thereby violating Article 8 of Convention No. 151.
5. 322. Fourthly, the CLC alleges that Bill 26 violates Articles 3, 8 and 10 of Convention No. 87 by allowing collective agreements (in both public and private sectors) to set standards for employment which are less than the minimum working standards set by the Government on issues such as maternity leave, vacation, overtime, special clothing and hours of work. According to the CLC Bill 26 also gives the Director of Employment Standards (a Government appointee), the authority to nullify a collective agreement once it has expired. The CLC alleges that Bill 26 severely limits the rights of workers and their organisations to negotiate with employers their terms and conditions of employment to further their interests. The particular section complained of reads as follows. "section 2(2). Where a collective agreement contains any provision respecting a matter set out in column 1 of the following table [hours of work, overtime or special apparel, annual vacation or vacation paid, termination of employment or lay-off, maternity or pregnancy leave], the Part of this Act [which deals with that particular matter] does apply in respect of employment pursuant to that collective agreement ... (5) Where the period for which a collective agreement is expressed to be made expires and the agreement is not renewed or replaced by a succeeding collective agreement, but employees who were covered by it continue in their employment, an interested party may apply to the Director for a declaration that it is no longer appropriate for the provisions of the collective agreement to continue to subsist or bind the employers or employees. (6) The Director may ... make enquiries he considers necessary to ascertain what progress has been made towards the conclusion of a new collective agreement, and where he considers that an appropriate time has passed without reasonable progress towards the conclusion of it, he may declare that the continued application of the provisions of the agreement is no longer appropriate. (7) On the making of a declaration referred in subsection (6), no provision of the expired collective agreement is binding on the employer or employees, notwithstanding any provision to the contrary in the agreement, and the provisions of this Act apply". According to the CLC section 2(2) means that the employment standards within the Act will no longer be minimum standards for all workers since a collective agreement is considered an agreement to waive the provisions of the Act if the minimum standards or higher cannot be achieved at the bargaining table. Moreover, section 2(5), (6) and (7) provides that where a collective agreement has expired and an interested party has applied to the Director, the latter can order that the minimum standards of the Act be imposed on the parties. According to the CLC, the union's prospects of furthering and defending the interests of its members are severely undermined by the action of a government appointee (the Director) who may nullify the expired collective agreement and impose weaker standards than those in the expired collective agreement. As regards Article 4 of Convention No. 98, the CLC states that Bill 26 does little to promote the concept of voluntary negotiations and collective bargaining and in fact severely undermines the ability of a union to negotiate since it is no longer on an equal bargaining position at the beginning of negotiations and, moreover, if that balance is upset during the negotiation process by interference by the Government the basic principles of collective bargaining will be undermined.

B. The Government's reply

1. 323. In its communication of 17 April 1984, the Government states that Bill 2 (The Public Service Labour Relations Amendment Act) is unlikely to be enacted given the successful conclusion of negotiations between the Government and the British Columbia Government Employees Union. With regard to the allegations concerning Bill 3 (The Public Sector Restraint Act), the Government states that the Act was substantially amended before its passage to make explicit provision for appeal, due process and fairness of treatment, and it includes an option for groups of public sector employees to negotiate an exemption from the termination provisions of the Act. This exemption provision has been widely and successfully embraced. With respect to the allegations regarding Bill 11 (the Compensation Stabilisation Act) the Government states that the main purpose of the Compensation Stabilisation Programme is to ensure that compensation rates remain within the Province's ability to pay. According to the Government, it is its responsibility to determine what the Province can afford and set its fiscal policies and budget accordingly. As regards Bill 26 (The Employment Standards Amendment Act) the Government explains that amendments were subsequently introduced to make it clear that nothing in the Act affects the powers and duties of the Labour Relations Board or impinges upon collective agreements.

C. The Committee's conclusions

1. 324. As regards the complainant's allegation that section 13 of Bill 2 excludes broad issues from collective bargaining, the Committee notes the Government's statement that the Bill is unlikely to be enacted. It accordingly requests the Government to keep it informed of the eventual withdrawal of this Bill and considers that this aspect of the case does not call for further examination.
2. 325. As regards the remaining legislation, Bills 3, 11 and 26 (two of which became law on 26 October 1983, Bill 11 becoming law on the 21st with retroactive effect to 7 July 1983), the Committee notes that, at this present meeting, within the framework of Case No. 1173 (Canada/British Columbia), it has undertaken a detailed examination of the legislation in question and would accordingly adopt the same conclusions in the present case.
3. 326. Nevertheless, with respect to Bill 26, the Committee notes that the complainant in the present case makes further more detailed allegations concerning, in particular, subsections 5, 6 and 7 of section 2 thereof. Since these subsections were not raised in the examination of Case No. 1173, the Committee will proceed to examine them here. The texts of the subsections concerned are reproduced in the analysis of the complainant's allegations. The Committee notes that the Government does not specifically reply to the allegation concerning the wide discretion of the Director of Employment Standards (a government appointee) to impose the provisions of the Act where a collective agreement has expired and is unlikely to be renewed. The Committee concludes that such government intervention is contrary to Article 3 of Convention No. 87 which prescribes that the public authority shall refrain from any interference which would restrict the right of workers and employers organisations to organise their administration and activities and to formulate their programmes. The Committee accordingly requests the Government to consider introducing amendments to reduce the wide powers given to the Director under section 2 (5), (6) and (7), and to keep the Committee informed of developments in this regard.
4. 327. The Committee draws the legislative aspects raised in this case to the attention of the Committee of Experts on the Application of Conventions and Recommendations.

The Committee's recommendations

• The recommendations of the Committee
  328. 328 In these circumstances, the Committee recommends the Governing Body to approve this report and, in particular, the following conclusions:
       • (a) The Committee notes the Government's statement that Bill 2 is unlikely to be enacted and would accordingly request it to inform the Committee of the official withdrawal of this Bill and considers that this aspect of the case does not call for further examination.
       • (b) The Committee notes that it has thoroughly examined Bills 3, 11 and 26 at this present meeting in the context of Case No. 1173 and accordingly adopts the conclusions it reached therein for the present case.
       • (c) As regards one aspect of Bill 26 which was not raised in Case No. 1173, namely the wide powers given to a government official under section 2 (5), (6) and (7), the Committee considers that his power to replace negotiations on collective agreements with the provisions of the Act when, in his opinion, negotiations are not leading to a settlement, is contrary to Article 3 of Convention No. 87; the Committee accordingly requests the Government to consider introducing amendments to this section of the Act and to keep the Committee informed of developments in this regard.
       • (d) The Committee draws the legislative aspects of this case to the attention of the Committee of Experts of the Application of Conventions and Recommendations.