An attack on the right to strike

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In recent years, there’s been concern about the unprecedented use of section 107 of the Canada Labour Code to end labour disputes and plenty of questions about the unfettered power it gives the federal labour minister.

Now that the federal government has moved to codify the use of section 107 in its latest omnibus bill, the Building Canada Strong Act, which gives the minister the power to use their discretion to end a strike rather than needing to use back-to-work legislation, critics are calling it an attack on the right to strike.“It goes against what the right to strike means in Canada. We have huge concerns about that,” says Siobhán Vipond, executive vice-president of the Canadian Labour Congress.

Putting up guardrails

The federal government says it’s making changes to the Canada Labour Code to “ensure that workers have strong protections, safe workplaces, and a modern labour framework that supports constructive labour relations and economic security.” Jobs Minister Patty Hajdu insists the changes are giving unions more protections and putting up guardrails around the use of section 107. 

So far, that has not mollified unions across the country. That’s in part because the way the provision has been used in recent years remains legally uncertain. 

Section 107 states that the labour minister, where expedient or necessary to secure industrial peace, may refer questions to the Canada Industrial Relations Board or direct the board to take such action as the minister deems necessary. It has been part of the Code since 1984 and largely went unused until 2011, when former minister Lisa Raitt used it after Air Canada flight attendants twice voted down collective agreements.

In 2024, former federal labour minister Seamus O’Regan unsuccessfully attempted to use it to pre-empt a WestJet strike. However, his successor, Steven MacKinnon, used it to end a lockout and potential strike by the country’s two main railway companies, to end strikes and lockouts at Vancouver, Quebec, and Montreal ports, and to put off a weeks-long strike by Canada Post workers.

Labour unions have challenged its use in the courts, and Vipond would rather wait for the Supreme Court of Canada to weigh in before the government decides that its interpretation of its powers is correct.

“Let’s let the court decide on that,” she says. 

“We think it hasn’t been used the way it was intended.”That’s why the government’s move to allow the minister to use their opinion to end a strike isn’t sitting well. 

Given how section 107 has been used, some labour lawyers acknowledge that the proposed legislation would put guardrails in place where none exist, considering the minister has been able to do what they want.

Bill C-39 proposes new timelines to ensure that negotiations begin six months before the end of a collective agreement in federally-regulated workplaces. It also introduces more mediation and dispute resolution tools and extends the conciliation period from 60 to 90 days. It includes plans to introduce the regulatory authority to establish monetary penalties for bad-faith bargaining.

As for section 107, before the minister can invoke it, the bill requires that a special mediator be appointed and complete a report for the minister that is made public. The minister has to “consider the report” and have “formed the opinion that a strike or lockout would have a significant adverse national impact.”

Once the minister invokes the provision, they can direct the Canadian Industrial Relations Board to order the resumption of operations or services, extend the terms of the existing collective agreement on an interim basis, or establish a binding dispute-resolution mechanism such as binding interest arbitration.

There would also be provisions requiring post-dispute mediation within six months of a labour disruption.

From reactive to proactive 

Not everyone is concerned about the proposed changes, however. Craig Munroe, an employer-side labour and employment lawyer with Crawford Munroe Thomson LLP in Vancouver, says some employer organizations don’t think the legislation goes far enough, nor does it address the existing uncertainty.

While the bill makes the government’s process for considering and responding to these disputes more proactive and transparent, critics say the ministerial discretion granted in the proposed legislation is not as good as tabling back-to-work legislation in the House.

“Back-to-work legislation is fundamentally reactive, and it ends up happening after all sorts of other things have happened, and it tends to be tailored to that specific situation,” Munroe says, noting parties don’t know at the start of bargaining if there will be back-to-work legislation, or how the government will account for the conduct of the parties or how they got there if it is introduced.

While invoking back-to-work legislation isn’t a transparent process and lacks mechanisms to ensure things don’t reach that point in the first place, he says it still has to go to the House of Commons and face political pressure.

The model proposed by C-39 is the opposite—it’s proactive, sets out a process in advance so the parties know what it entails, and puts in place mechanisms to ensure the process doesn’t result in a back-to-work order. 

The devil is in the details

Brenda Comeau, a partner at Pink Larkin in Fredericton and chair of the CBA’s labour law section, says the legislation is an indication the federal government plans to use section 107 more. 

As for the effectiveness of the proposed “guardrails,” the devil will be in the details of how they’re implemented, since the test of “significant impact on the Canadian economy” is a low bar for rail or aviation.

Comeau says that the imposition of binding interest arbitration is the only recognized alternative to a strike and is likely the mechanism that makes the legislation constitutional.

“Police officers, firefighters, anyone that is deemed essential—usually they don’t have a right to strike, but they have access to interest arbitration, so it’s almost second-best."

Arbitration generally entails reviewing comparator groups to determine what their collective agreements contain and working from there. She says unions generally tend to do well in this process, but it ultimately comes down to the details.

Munroe doesn’t think most employers want to be in a situation where the minister would invoke section 107 to send the matter to arbitration.

“I know lots of employers who are not fans of binding arbitration, and if [unions] think that’s the outcome that they’re trying to get to, I don’t think that’s accurate in a lot of cases,” he says. 

“It is inherently uncertain for both parties, and I think it’s too simplistic [to assume] that it’s what employers are trying to push toward.”

Employers are also concerned about the legislation’s timelines for earlier negotiation, as they could significantly extend the freeze period, which bans employers from unilaterally changing wages, benefits, working conditions, or past practices during bargaining.

Monroe says employers need to continue managing their businesses, so extending the freeze period places significant restrictions on their ability to respond to a rapidly changing global economy. 

“That in and of itself provides incentive for the deal to get done as soon as possible, because it’s a long time not to be able to make any changes to their business.” 

Comeau says that while earlier intervention by mediators can be beneficial, it’s not always the case.

“Sometimes you do need to at least threaten to go on strike, and then parties have a way of getting to a table to figure it out.”

Vipond agrees. There’s often so much movement in the last few hours of a negotiation, as the parties work things out, that mediation earlier in the process might be more challenging.

She’s also skeptical of appointing a special mediator ahead of any contemplation of section 107 because they can only give advice to the minister and are not independent decision-makers. Monroe, however, sees it as a way to discourage parties from “ragging the puck” or engaging in bad-faith negotiations in hopes of ministerial intervention. The legislation allows a special mediator to assess the parties’ conduct and make the assessment public, which can serve as a name-and-shame mechanism.

“That’s not a small thing,” he says, describing it as a new and unusual dynamic.

“Any special mediator that has significant experience with labour negotiations, it’s going to become pretty clear to them if one party is playing games.”

If a mediator points the finger at a party for playing games, that will have political ramifications and fallout, Monroe says. Ultimately, it may play a role in how the minister exercises discretion or influence the binding arbitration process, particularly if one side has rejected a tentative agreement.

He reiterates that it doesn’t make sense for employers to create a situation that would prompt the government to invoke section 107.

“Employers don’t like uncertainty,” he says. “A back-to-work order can only occur once the strike or lockout has commenced, and no employer wants to have a strike. There are a lot of disincentives for either party to be playing games.”

Lack of a problem to solve

Vipond returns to the fact that the purpose of a strike is to put pressure on an employer. She says the legislation undermines workers’ ability to withdraw their labour. It opens the door for an employer to come to the table without being ready to reach an agreement, with the aim of calling the minister to say that a strike is not in the national interest. 

As part of its justification for the bill, the government says that more than 95 per cent of bargaining results in an agreement. Vipond says that’s an indication there isn’t a problem the feds are trying to solve. Instead, intervening in and undermining the process looks like an attempt to prevent strikes altogether, which undermines the right to strike.

“It would be great if we didn’t have strikes,” she says.“But there is a solution to make sure that strikes and lockouts don’t happen, and that’s an agreement.”