Ontario's austerity measures and the limits of Charter protected bargaining rights 


August 2012

Employment and Labour Bulletin

The recommendations of the Drummond Report , released earlier this year, have guided the Ontario provincial government's recent public sector austerity measures.  After months of unsuccessful negotiation with its teacher unions, on August 16, 2012, Ontario announced the Putting Students First Act, 2012 (PSFA).  The provincial legislature has been recalled for the introduction of this bill on August 27, with the aim to pass it by August 31, when the current collective agreements expire.

The PFSA, if passed, would include an imposed wage freeze and a prohibition against any strikes or lock-outs for a two-year period on virtually all Ontario public sector teachers and support workers.  School boards and local bargaining units of teachers and support staff would have until the end of the year to sign local agreements consistent with the priorities reflected in the Memorandum of Understanding reached between the government and the Ontario English Catholic Teachers' Association (OECTA).

To date, three unions, representing approximately 45,000 workers (the OECTA, and two unions of Francophone teachers and other school support workers) have accepted the agreement, but only three of 72 school boards have signed on.  The largest teacher unions, representing more than 130,000 public educators, the Elementary Teachers Federation of Ontario, and the Ontario Secondary School Teachers Federation, along with the Canadian Union of Public Employees, representing 55,000 school support workers, have refused, vowing instead to launch a constitutional challenge to the Supreme Court of Canada to protect their collective bargaining rights.

The battle lines are drawn:  on one side, an austerity-minded government, with the general support of the public, and on the other, the labour unions, relying upon bargaining rights which they claim are protected by the Canadian Charter of Rights and Freedoms.  The unions look to the failure of similar legislation in British Columbia to survive a Charter challenge to the Supreme Court of Canada, which ruled in favour of the unions.  Similar battle lines have been drawn between the government and Ontario's doctors.  The doctors filed a Charter challenge in July 2012.

However, there are limits to Charter protected bargaining rights.  If the PSFA is passed and there is a Charter challenge, the Ontario government will likely argue that a key distinction between the ill-fated British Columbia legislation and the proposed Ontario legislation is the latter's extended months-long negotiations which preceded its enactment.

The imposition of public sector wage freezes or caps tends to be aligned with public opinion and current austerity measures, but the Charter exists precisely to protect against what may be merely fiscally expedient and reflective of public sentiment.  The teacher unions correctly refer to the right to bargain collectively which is protected under the Charter, and correctly demand that governments must pay heed to those rights.  However, these teacher unions will also have to carefully consider that the right to bargain, while protected, is also limited.

The Supreme Court of Canada has confirmed that the right to collective bargaining is a "limited" right to a bargaining process, and is not a right or guarantee to any certain substantive or economic outcome or to any particular model of labour relations or any specific bargaining method.  Highlights of more recent cases that clarified the limitations on the Charter enshrined right to bargain collectively in the public sector, are as follows:

  • Reliance cannot be placed on section 2(d) of the Charter to achieve or maintain a bargaining process that maximizes or preserves a union's particular collective bargaining interests or existing bargaining structures;
  • Section 2(d) of the Charter is not breached if the requirements of "good faith negotiation and consultation" have been preserved and followed during the process by which the legislation was enacted; even if a breach of section 2(d) is found, the legislation may be reasonably and demonstrably justified in a free and democratic society and thereby saved under section 1 of the Charter; and
  • Although section 2(d) of the Charter may be violated if legislation effectively prevents any meaningful discussion and consultation between the parties where the government's fiscal position is sufficiently serious, a temporary suspension of the full range of collective bargaining "to facilitate a multi-faceted economic response to a crisis affecting the financial well-being of the public" may be justified.

Our view is that the following framework will apply to the current Ontario provincial government's ability to shape bargaining mandates with its teacher unions, or with any other public sector unions:

  • As has long been the case, employer bargaining teams in many situations will continue to be tasked with a restraint mandate.
  • Provided the Charter right to a bargaining process is respected, and subject to prevailing economic conditions, governments can be expected to continue to insist on restraint mandates.
  • The appropriateness of particular bargaining positions and the related justifications for any proposals, will continue to be driven by the unique circumstances of a particular set of labour negotiations.
  • The traditional labour law obligation to bargain in good faith will continue to apply.

No amount of legislation will be effective in doing away with the ongoing obligation to meet with relevant unions, make candid presentations to justify relevant proposals, and consider any union proposals in good faith.  However, if after the appropriate parameters are adhered to in good faith and no agreement is reached, the provincial government's PFSA, if passed, may be justified.  This will be particularly the case if "the deal" is not legislated and instead, government is obliging the parties to bargain a zero cost increase renewal agreement.

by George Waggott and Lai-King Hum

a cautionary note

The foregoing provides only an overview and does not constitute legal advice. Readers are cautioned against making any decisions based on this material alone. Rather, specific legal advice should be obtained.

© McMillan LLP 2012