Report in which the committee requests to be kept informed of development - Report No 243, March 1986

Case No 1350 (Canada) - Complaint date: 08-OCT-85 - Closed

1. 293. The World Confederation of Organisations of the Teaching Profession (WCOTP) presented a complaint against the Government of Canada/British Columbia in a communication dated 8 October 1985 on behalf of its affiliate, the B.C. Teachers' Federation. It supplied further information in a letter dated 18 December 1985. The Goverment supplied its observations in a communication dated 20 January 1986.
2. 294. 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. 295. The WCOTP, in its letter of 8 October 1985, alleges that teachers employed by school boards in British Columbia are denied collective bargaining rights. It states that the Government has disregarded the Committee's recommendations in Case No. 1173 and has taken further measures to limit the revenue of school boards, to restrict the school boards' right to negotiate the salaries of their employees, to determine in advance the outcome of negotiations and arbitration, and to impose the principle of ability to pay as the sole determinant of the outcome of bargaining leaving arbitration boards powerless.
2. 296. More specifically, the WCOTP refers to the following legislative restrictions:
3. (1) School Act 1979 (which governs teachers' collective bargaining) limits the scope of bargaining to monetary "salary and bonus" matters;
4. (2) Education (Interim) Finance Act 1982, as amended, alters unilaterally the fiscal year of school boards so that a board must establish its final budget for approval by the Minister of Finance before collective bargaining can be concluded or the findings of arbitration boards are known;
5. (3) Treasury Board Directive No. 1/86 of 4 April 1985, issued under the Financial Administration Act, imposes severe penalties - in the form of grant reductions - on school boards which attempt to free funds for salary increases by reducing the number of teachers employed;
6. (4) amendments to the Compensation Stabilisation Act 1982, as amended, empower the Commissioner to over-rule any collective agreement or arbitration award that is considered not to be consistent with the outcome desired by the Government.
7. 297. The WCOTP attaches to its complaint a copy of several arbitration awards (Board of School Trustees of Vancouver District v. Vancouver Elementary/Secondary School Teachers' Associations, dated 28 June 1985, Sunshine Coast and Powell River Teachers' Associations v. Boards of School Trustees of Sunshine Coast and Powell River School Districts, dated 30 May 1985, and another) from which it appears that arbitrators, while recognising that they are bound by the ability to pay criterion of the Compensation Stabilisation Act, consider the present restrictions on the arbitral process unacceptable. The following extract from one of the awards sums up the complainant's criticism of the present situation of teachers' collective bargaining in the province:
   • We have referred earlier to the legislation, regulations and directives now in force. The fact is that it is pursuant to the scheme represented or created by this mishmash that the budgetary provisions outlined are now in effect, the hands of the (School Board) Trustees with respect to ability to pay are tied, and this Arbitration Board is powerless to do anything effective to award an increase otherwise justly due. The teachers have asked us to disregard these fetters and to make an award which will both recognise the merits of their position and assert our independence from such governmental restrictions and/or directives. Having in mind the traditional independence of arbitrators, and the desirability of making an award on the merits, the temptation to do so is strong, but the reality is that it would be but an empty gesture, resulting in further references to the Commissioner, references back, and expenditure of time and money by all parties to no practical effect.
8. 298. In its letter of 18 December 1985, the WCOTP explains that the B.C. Teachers' Federation had challenged Treasury Board Directive No. 1/86 as being unauthorised by law. In the lower court the Chief Justice of British Columbia found the Directive valid. The Court of Appeal (whose judgement of 21 November 1985 is supplied) found it invalid since a directive cannot overturn the School Act, which alone gives school boards the right to decide on the number of teachers employed and governs the salary negotiation process. The judgement contains strong criticism of the legislative interference in the arbitration process.

B. The Government's reply

1. 299. In its communication of 20 January 1986, the Government recalls that the evolution of the compensation stabilisation programme - the subject of Case No. 1173 referred to by the WCOTP - is linked directly to the difficult economic conditions that have plagued British Columbia since 1981. It cites unemployment, loss of revenues and public-sector wage increase settlements running at 14.4 per cent in 1981. The Government's detailed reply to the allegations concerning the programme are reproduced in the context of Case No. 1329 at paragraphs 173 to 181 of this report.
2. 300. In rely to the WCOTP's specific allegations concerning teachers' collective bargaining, the Government points out that the BCTF has recently challenged the provisions of the School Act governing the scope of collective bargaining before the courts. It consequently considers it inappropriate to discuss them until the court case is resolved. It does state, however, that the allegation concerning the Government's non-response to requests for amendment of the Act is misleading. These requests are quite recent and are linked to dissatisfaction that the teaching sector is covered by the compensation stabilisation programme. It points out that alternative - and wider - legislative coverage (e.g. under the Labour Code) was favoured by only a small majority of voting delegates at a 1983 BCTF convention. According to the Government, the School Act denies the right to strike but provides the alternative of compulsory arbitration of teachers' salaries where the parties are unable to reach agreement.
3. 301. As regards the Education (Interim) Finance Act, the Government states that it was passed to restrain public spending on education during a period of reduced government revenues and serious recession. Through this Act, the provincial government has determined the budget for school boards, but it does not direct them to apportion their budgets in any particular manner. Consequently, the Act does not preclude the possibility of salary adjustments being negotiated. The Act will be automatically repealed on 31 December 1986 (section 61). Moreover, the Government has announced that local taxing authority will be returned to school districts as of 1 July 1986, six months before the expiry of the legislation.
4. 302. The Government admits that there may be some confusion as to the intent and effect of Treasury Board Directive No. 1/86. It states that its purpose is to ensure the quality of education and the maintenance of teachers' jobs. According to the Government, the Directive does not preclude the negotiation of wage increases where those increases will not result in a loss of teachers' jobs. It cites statistics showing an annual average increase of 1.72 per cent in total compensation for full-time teachers over 1985-86. As regards the Court of Appeal's decision on this Directive, the Government considers that the majority decision is based on a legal technicality; it does not invalidate the Government's basic right to establish a formula which limits funding to local school boards which use teacher lay-off as a means of financing wage increases for other teachers.
5. 303. As regards the alleged government interference through ministerial statements (set out in detail by the WCOTP in the context of Case No. 1329, see paragraph 172 of the present report), the Government states that the Minister of Education has merely written to school boards to put them on notice that any negotiated salary increases would have to be funded from the budgets already allocated to the school districts.

C. The Committee's conclusions

1. 304. The Committee notes that it made a thorough examination of the 1982 Compensation Stabilisation Act and the 1982 Education (Interim) Finance Act in the context of Case No. 1173, reaching definitive conclusions at its May 1984 meeting (see 234th Report, paras. 75 to 91). The new aspects introduced in the present case consist of (1) allegations that the permanency of the compensation stabilisation programme, in particular the concept of employers' ability to pay and the constraints on arbitration, have almost destroyed teachers' collective bargaining; and (2) 1985 amendments to the Act and Treasury Directive No. 1/86 have worsened the situation.
2. 305. As regards the first of the new aspects listed above, the Committee has undertaken a detailed re-examination of the Compensation Stabilisation Act in the context of Case No. 1329 and would accordingly, in the present case, refer to the conclusions it has reached in that Case (see paras. 183 to 188).
3. 306. Moreover, the Committee had occasion during its examination of Case No. 1173 to examine the Education (Interim) Finance Act enabling the Government to block - through its budget - wage increases which had been previously agreed by the parties to the negotations (see 230th Report, para. 573). In the present case, the Committee can only endorse its previous conclusion that such action is not consistent with the principles of freedom of association. The Committee has stressed in the past the importance it attaches to the principle of the autonomy of the parties to the collective bargaining process, a principle generally recognised in the preparatory discussions that led to the adoption by the International Labour Conference in 1981 of the Collective Bargaining Convention (No. 154). It follows from this that the public authorities should not, as a rule, intervene in order to modify the contents of collective agreements which have been freely concluded. The Committee would also again recall that the exercise of financial powers, attributed to public authorities in a manner that prevents compliance with collective agreements entered into by public bodies is not consistent with the principle of free collective bargaining. It notes that this Act will terminate, in practice, in July 1986 and, in law, in December 1986.
4. 307. Given that Treasury Board Directive No. 1/86 has been overruled by the British Columbia Court of Appeal, the Committee considers that no purpose would be served in examining its compliance with the ILO principles of freedom of association. Likewise, the Committee is of the opinion that the complainant union's allegation of government interference through pressure placed on the employer school boards is insufficiently substantiated and does not call for further examination.
5. 308. As regards the School Act, the Committee would first point out that this legislation, in denying, as it does, the right to strike of teachers is not in conformity with the principle that the prohibition of strike action, which is a legitimate means of defending the economic and social interests of workers, should be limited to civil servants acting on behalf of the public authorities or to essential services in the strict sense of the term, that is, services the interruption of which would endanger the life, personal safety or health of the whole or part of the population. In addition, where strikes are restricted or prohibited adequate protection should be given to the workers to compensate them for the limitation thereby placed on their freedom of action through the provision of adequate, impartial and speedy conciliation and arbitration proceedings in which the parties can take part at every stage and in which the awards, once made, are fully and promptly implemented.
6. 309. The Committee expresses the hope that the Government will reconsider the legislative provisions that have been impugned in this case.
7. 310. As regards the alleged limited scope of teachers' bargaining under the School Act, the Committee notes the Government's statements in relation to this Act and that it is subject to court challenge. It recalls that in past cases (see, for example, 139th Report, Cases Nos. 743 and 744 (Japan), para. 211), with regard to allegations concerning the refusal to bargain collectively on certain matters in the public sector, the Committee has repeated the view of the Fact-Finding and Concliation Commission on Freedom of Association that "There are certain matters which clearly appertain primarily or essentially to the management and operation of government business; these can reasonably be regarded as outside the scope of negotiation." It is equally clear that certain other matters are primarily or essentially questions relating to conditions of employment and that such matters should not be regarded as falling outside the scope of collective bargaining conducted in an atmosphere of mutual good faith and trust. The Committee trusts that the court, in its examination of the case concerning the School Act, will take account of these principles. The Committee requests the Government to transmit a copy of the judgement in this case.

The Committee's recommendations

1. 311. In these circumstances, the Committee recommends the Governing Body to approve this report and, in particular, the following conclusions:
   • a) As regards the public-sector compensation stabilisation review programme, in force since 1982 by virtue of the Compensation Stabilisation Act, the Committee notes that it has re-examined the legislation at this present meeting in the context of Case No. 1329 and accordingly refers to the conclusions it has reached therein.
   • b) As regards the allegations relating to the Education (Interim) Finance Act, it considers that the use of financial powers attributed to public authorities in order to block fulfilment of previously negotiated collective agreements is not consistent with the principles of freedom of association. It notes that this Act will terminate, in practice, in July 1986 and, in law, in December 1986.
   • c) The Committee considers that the allegations relating to Treasury Board Directive No. 1/86 and the Government's interference through pressure placed on school boards do not call for further examination.
   • d) The Committee draws the Government's attention to the principles stated in paragraph 308 above and expresses the hope that the Government will reconsider the legislation.
   • e) The Committee draws the Government's attention to the principle stated in paragraph 310 above concerning the scope of bargaining; it requests the Government to transmit a copy of the judgement in the case concerning the School Act.