Supreme Court Confirms Labour Arbitrators Have Exclusive Jurisdiction Over Human Rights Complaints in Unionized Workplaces – JD Supra

Bennett Jones LLPThe Supreme Court of Canada recently confirmed that, subject to express legislative intent to the contrary, where labour legislation provides for the final settlement of disputes arising from a collective agreement, the jurisdiction of the labour arbitrator empowered by that legislation is exclusive.
The Court’s decision in Northern Regional Health Authority v Horrocks, 2021 SCC 42 [Horrocks] provides further clarity and confirms the Court’s previous jurisprudence on exclusivity and jurisdictional disputes between labour arbitrators and statutory tribunals.
The dispute underlying the Horrocks decision arose after Linda Horrocks, a unionized employee, alleged that her employer, the Northern Regional Health Authority (NRHA), failed to adequately accommodate her disability when it terminated her for violating a last chance agreement. After her termination, Horrocks filed a complaint before an adjudicator of the Manitoba Human Rights Commission alleging that her termination violated her rights under the Manitoba Human Rights Code.
The NRHA contested the Commission’s jurisdiction to hear the complaint, arguing that the Court’s previous decision in Weber recognized exclusive jurisdiction in an arbitrator under a collective agreement, and this jurisdiction extended to human rights complaints arising in a unionized workplace. The Commission disagreed and found it had jurisdiction because the essential character of the dispute related to an alleged human rights violation. The Commission then determined the complaint on its merits and found that the NRHA had discriminated against Horrocks.
The Commission’s decision on jurisdiction was set aside on judicial review, where the Court found that the essential character of the dispute was whether the NRHA had just cause to terminate Horrocks’ employment, which, although it included an alleged human rights violation, was within the exclusive jurisdiction of the labour arbitrator.
The Court of Appeal agreed with the Court’s conclusion on judicial review that disputes about the termination of a unionized employee (including alleged human rights violations) are within the exclusive jurisdiction of a labour arbitrator, but found that the Commission had jurisdiction because:
The majority of the seven-member panel of the Supreme Court (Justice Karakatsanis was the sole dissenting judge) allowed the NRHA’s appeal and set aside the judgment of the Court of Appeal. The Court found that the Commission did not have jurisdiction over the complaint as jurisdiction lay exclusively with the labour arbitrator in accordance with the collective agreement and the Manitoba Labour Relations Act.
In reaching its conclusion, the Court reiterated and further refined the two-step analysis previously set out in its decision in Morin to resolve jurisdictional disputes between labour arbitrators and competing statutory tribunals:
STEP ONE: The relevant legislation must first be examined to determine whether it grants the arbitrator exclusive jurisdiction and, if so, over what matters. Where the legislation includes a mandatory dispute resolution clause, an arbitrator has the exclusive jurisdiction to decide all disputes arising from the collective agreement, subject to clearly expressed legislative intent to the contrary.
STEP TWO: If the legislation grants the labour arbitrator exclusive jurisdiction, then a determination must be made as to whether the dispute falls within the scope of the jurisdiction. Such jurisdiction will extend to all disputes that arise, in their essential character from the interpretation, application or alleged violation of the collective agreement. The relevant inquiry is into the facts alleged, not the legal characterization of the matter.
In Horrocks, the collective agreement and the Labour Relations Act mandated the arbitration of “all differences” related to the “meaning, application or alleged violation” of the collective agreement. As the labour legislation provided for the final settlement of disputes arising from a collective agreement, the jurisdiction of the labour arbitrator empowered by the legislation is exclusive. The Court acknowledged that competing statutory tribunals may carve into the sphere of exclusivity, but only where the legislative intent is clearly expressed. The Court found no such intent in the Human Rights Code.
In considering the essential character of Horrocks’s complaint before the Commission, the Court disagreed with the Commission’s characterization of the complaint as arising from “an alleged violation of [Horrocks’s] human rights.” Instead, the Court found that in essence Horrocks’s complaint arose foursquare from the NRHA’s exercise of its rights under, and from its alleged violation of, the collective agreement. While the Court recognized that the complaint involved certain of Horrocks’s statutory rights, such rights were “too closely intertwined with collectively bargained rights to be sensibly separated” and, as such, her claim falls solely to the arbitrator to adjudicate.
While the Horrocks decision specifically concerned Manitoba’s Labour Relations Act, the language at issue under the act is almost identical to that in section 48(1) of the Ontario’s Labour Relations Act, and is substantially similar to other provincial labour relations statutes. As a result, the decision will have broad application to employers of unionized workforces in Ontario, and potentially across the country.
However, the Court was careful to note that certain statutory schemes across Canada may disclose a legislative intention that human rights tribunals do have concurrent jurisdiction over complaints arising under a collective agreement. The Court specifically mentioned that both the Federal and British Columbia human rights statutes empower decision-makers to defer consideration of complaints that are capable of being dealt with through a grievance process, which, according to the Court, necessarily implies that these decision-makers have concurrent jurisdiction over disputes that are subject to the grievance process. Accordingly, employers in unionized workplaces in British Columbia, or in Federally-regulated industries, may not be able to rely on the Horrocks decision where a worker brings a human rights complaint.
The Court did not specifically mention Alberta’s legislative scheme in Horrocks. However, section 22(1.1) of the Alberta Human Rights Act empowers the Director of the Alberta Human Rights Commission to refuse to accept a complaint that could or should be dealt with in another forum or under another Act. Further, section 67.1 of the Labour Relations Code (Alberta) allows any party to a proceeding before the Alberta Human Rights Commission or a human rights tribunal to request that the Alberta Labour Relations Board marshal that proceeding. Taken together, these provisions may suggest that decision-makers under the Alberta Human Rights Act have concurrent jurisdiction to hear disputes arising under collective agreements, similar to the Court’s comments on Federal and British Columbia legislation.
Horrocks is a welcome decision for employers of unionized workforces as it provides additional clarity and confirmation of an arbitrator’s exclusive jurisdiction, subject to clear legislative intent to the contrary, and ensures consistency in approach, adjudication and timeliness of complaints in the grievance procedure. The decision also guards against the risk of a multiplicity of proceedings, confining human rights disputes arising under a collective agreement to the labour arbitration process—a process that allows employers a say in selecting an arbitrator with specific experience and knowledge. However, as discussed above, whether labour arbitrators’ jurisdiction is truly exclusive will depend on the specific statutory scheme that applies to the particular employment relationship, and business owners faced with human rights complaints arising in unionized workplaces would be wise to seek legal advice to determine the effect of the legislative scheme at issue.
While a helpful decision for employers, unions should take warning that the effect of the decision may lead to an increase in duty of fair representation complaints where unions decide not to advance human rights grievances.
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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.
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