Labour Law in Ontario

labour law ontario

Labour law is the law of the unionized workplace. This means that labour law applies to the relationship between an employer and its union. In other words, if you are an employer with a union, you are subject to labour law. Likewise, if you are an employee in a union, you are subject to labour law. 

Difference between Labour Law and Employment Law

Employment law, on the other hand, is the set of rules regulating the non-unionized workplace.

Employment law and labour law are not the same things. Labour law only applies to unionized workplaces, while employment law only applies to non-unionized workplaces. 

In unionized workplaces, a collective bargaining agreement establishes the terms and conditions of employment in place of employment law legislation such as the Employment Standards Act or individual employment contracts. 

Rather than the Employment Standards Act (which governs non-unionized workplaces), the Labour Relations Act sets out unionized workplace rules in Ontario.

Most importantly, the Labour Relations Act affirms the right of employees to join a trade union. Also, the Labour Relations Act spells out how a union is formed. Thereafter, the Labour Relations Act regulates several different topics, including the content of collective agreements and rules regarding strikes and lock-outs, among others. This blog post will not discuss the Labour Relations Act further as it is outside the scope of the post, but you can read the actual Labour Relations Act here. 

What are the Special Rules in Labour Law?

Labour law governs the “collective bargaining agreement” (“CBA”) between an employer and unionized employees.

There are no CBA’s in employment law. In employment law, workers have individual contracts. Unionized employees do not have individual contracts, rather, they have CBAs which cover many employees.

The employees subject to a CBA are called a “bargaining unit”. 

A collective bargaining agreement is a deal negotiated between the employer and the union regarding almost every term and condition of employment for applicable employees.

How to find a CBA? Check the website of the union for a copy of the CBA. Most union “locals” keep their CBA on their website. 

A CBA will cover most terms and conditions of employment and the rights of employers and employees. Some of the more common terms in a CBA include:

  • hours
  • pay and benefits 
  • scope of work 
  • seniority and promotions 
  • terminations and layoffs
  • discipline
  • strikes and lock-outs

Lastly, arguably the most notable item in a CBA is the “grievance” procedure. This is what really differentiates labour law and employment law. 

Grievance Meaning

A grievance is a process for dealing with an allegation that one of the parties has breached the CBA. Yes, employers can bring grievances.

In employment law, there are no grievances. In employment law, the only recourse analogous to labour law protections is an expensive injunction and even then; the court has limited powers to order employers to do anything. For example, a court generally cannot award an employee his job back, but a grievance can.  

On the flip side, unionized employees generally cannot sue their employer – they have to go through the grievance procedure. In this regard, labour law is unique in that workplace disputes must first usually be settled by dispute resolution, and not the courts, unlike employment law. As such, unionized employees who are wronged by the employer cannot hire a lawyer to write a demand letter or sue. They must complain as per the procedures set out in the collective bargaining agreement, and they must use their trade union’s chosen lawyer. To that effect, for example, a unionized employee cannot launch a negotiation or lawsuit for more severance. Unionized employees are only entitled to a severance amount as per their CBA, which is usually quite low. 

Grievance Procedure

This steps below are an example of a typical grievance procedure, but any collective bargaining agreement may have a different process. 

Step One

The grievance is submitted in writing. A manager will meet with the employee in an attempt to resolve the grievance. 

Step Two

If the grievance remains unsettled after step one, the griever may request an appeal (usually with a supervisor or board of supervisors). 

Arbitration

If a grievance is not settled at step two, either party may proceed to arbitration. However, in some CBAs, the union can decide whether or not to bring a grievance to arbitration. Arbitrations are lengthy and expensive matters. Some unions may not proceed on certain arbitrations that are doomed to fail. However, a union does have a duty of fair representation (discussed below); it cannot arbitrarily deny bringing a grievance on behalf of a member. 

The decision of the arbitrator is final.

Union’s Duty of Fair Representation

In Ontario, unions must fairly represent all employees in the bargaining unit, and a breach of this “duty of fair representation” gives an aggrieved employee the right to file a complaint with the Ministry of Labour

The duty of fair representation requires a union not to act in a manner that is arbitrary, discriminatory or in bad faith. 

In Canadian Merchant Service Guild v. Gagnon[1984] 1 SCR 509, the Supreme Court of Canada determined the following points about the duty of fair representation:

  1. The exclusive power conferred on a union to act as spokesman for the employees in a bargaining unit entails a corresponding obligation on the union to fairly represent all employees comprised in the unit.
  2. When … the right to take a grievance to arbitration is reserved to the union, the employee does not have an absolute right to arbitration and the union enjoys considerable discretion.
  3. This discretion must be exercised in good faith, objectively and honestly, after a thorough study of the grievance and the case, taking into account the significance of the grievance and its consequences for the employee on one hand and the legitimate interests of the union on the other.
  4. The union’s decision must not be arbitrary, capricious, discriminatory or wrongful.
  5. The representation by the union must be fair, genuine and not merely apparent, undertaken with integrity and competence, without serious or major negligence, and without hostility towards the employee. 

If the Ministry of Labour finds that there has been a violation of the duty of fair representation, for example, in processing a grievance, it can only put the griever in the position he or she would have been in if the union had not breached its duty of fair representation. This means the Ministry of Labour cannot deal with the grievance – the Ministry of Labour can only send the matter back to arbitration. 

The above is just a very brief summary of labour law in Ontario. There are many more details not listed above, but these are the most important things to know about labour law in Ontario.

We do not represent unionized employees, but If you are an employer facing a union drive, please contact us; our law group will act for employers in those circumstances.