Association of Justice Counsel v. Canada (Attorney General), 2017 SCC 55 — Labour relations — Arbitration — Grievances

On appeal from a judgment of the Federal Court of Appeal (2016 FCA 92) allowing an application for judicial review and setting aside a decision of an adjudicator of the Public Service Labour Relations and Employment Board (2015 PSLREB 31).

In the early 1990s, the employer established a standby shift system to respond to urgent immigration matters outside of normal business hours, whereby a lawyer in the Immigration Law Directorate in the Quebec Regional Office of the Department of Justice Canada would be available evenings and weekends to attend on short notice to any urgent stay applications that might arise. Until 2010, the system worked on a volunteer basis. Lawyers who volunteered to cover standby shifts were compensated with paid leave and received the same amount of compensation irrespective of whether they were called into work. In March 2010, the lawyers were informed that they would no longer be paid for time spent on standby. Instead, they would be compensated — through either overtime pay or paid leave, depending on their seniority status — only for the time they spent working if they received an urgent request. With this change in policy, there were no longer enough volunteers to cover the standby periods. In response, the employer issued a directive making after‑hour standby shifts mandatory. The Association of Justice Counsel then filed a grievance on behalf of lawyers working in the Immigration Law Directorate.

The collective agreement at issue is silent on standby duty, but it specifies that the employer retains all management rights and powers that have not been modified or limited by the collective agreement. The labour adjudicator concluded that the directive was not a reasonable or fair exercise of management rights and infringed the lawyers’ right to liberty under s. 7 of the Charter. He ordered the employer to immediately cease applying the directive. The Federal Court of Appeal allowed the government’s application for judicial review and set aside the adjudicator’s decision.

Held (7-2): The appeal should be allowed in part. The adjudicator’s decision that the directive contravened the collective agreement is reasonable and his order that the employer stop applying the directive should be reinstated.

Per McLachlin C.J. and Abella, Karakatsanis, Wagner, Gascon, Brown and Rowe JJ.:

At issue is the interpretation of a management rights clause in a collective agreement, clearly a matter on which labour arbitrators are owed deference. Management’s residual right to unilaterally impose workplace rules is constrained by the collective agreement, as it provides that in administrating the collective agreement, the employer must “act reasonably, fairly and in good faith”. The approach to determining whether a policy that affects employees is a reasonable exercise of management rights is the “balancing of interests” assessment. This approach requires labour arbitrators to apply their labour relations expertise, consider all of the surrounding circumstances, and determine whether the employer’s policy strikes a reasonable balance between management and employees’ interests. Whether the unilateral imposition of a standby period is reasonable and fair will depend on the circumstances and the terms of the particular collective agreement. This determination is highly fact‑based.

The adjudicator applied the appropriate analytical framework to assess the exercise of management rights and the surrounding circumstances of the directive supported his conclusion that the employer’s directive was neither reasonable nor fair. There was no standby clause in the recently finalized collective agreement, no mention of the requirement in the lawyers’ employment contracts or job descriptions, nor were similar policies the norm in the sector. The fact that the directive affects the lawyers’ lives outside of working hours is a significant factor in the assessment of the directive’s impact on employees. Further, there is some apparent unfairness in a policy or directive that unilaterally withdraws compensation for standby duty, when the provision of such compensation had been a long‑standing practice. While an employer does not need to provide evidence that there were no other alternatives, the availability of realistic, but less intrusive, means to meet organizational needs may be a relevant consideration in the balancing of interests assessment. The adjudicator was entitled to note the lack of such evidence. There is also no indication that the adjudicator misunderstood the factual impact of the directive on the lawyers, as set out in the agreed statement of facts. The Federal Court of Appeal therefore erred by substituting its own balancing of the interests involved for that of the adjudicator.

The directive does not violate the lawyers’ s. 7 Charter right to liberty. The directive requires them, as a condition of their employment, to be potentially less available to their families or to forego certain personal activities for, at most, two to three weeks a year. This incursion into the private, after‑work lives of the lawyers does not implicate the type of fundamental personal choices that are protected within the scope of s. 7.

Per Moldaver and Côté JJ. (dissenting in part):

The adjudicator erred in concluding that the mandatory standby duty directive represented an unreasonable and unfair exercise of the employer’s management rights and infringed counsel’s right to liberty guaranteed by s. 7 of the Charter.

The adjudicator’s reasoning was clearly influenced by his erroneous conclusions with respect to s. 7 of the Charter, as he considered the issue of whether the directive represented a reasonable and fair exercise of the employer’s management powers through the prism of those conclusions. For example, in concluding that the directive seemed to him quite simply neither reasonable nor fair, the adjudicator noted, inter alia, that it would instead be fair for counsel to be compensated for the time during which the employer continued to exercise a certain control over their lives. The adjudicator’s conclusions on the violation of the collective agreement with respect to the exercise of the management power and the protection of counsel’s constitutional rights were thus based on the same characterization of the impact of the directive on the lawyers’ lives. This characterization seems flawed in that it disregards key elements of the agreed statement of facts.

Because the grievance should be remitted to another adjudicator, it would not be appropriate to rule on the reasonableness and fairness of the directive. It should be noted, however, that the conclusions of the adjudicator in this case do not seem defensible in respect of either the facts or the law. Regarding the facts, his conclusion that the employer had a certain control over the organizational need underlying the unilateral imposition of standby duty goes against the common evidence submitted by the parties to the effect that a stay application can arise unexpectedly and should be processed on an emergency basis. For this reason, therefore, to the extent that the adjudicator has disregarded certain essential facts in his reasons, his decision does not fall within a range of possible, acceptable outcomes which are defensible in respect of the facts.

Nor does the adjudicator’s decision seem defensible in respect of the law. The analysis of the reasonableness and fairness of a unilaterally imposed directive is based on a balancing of interests approach, not an approach focusing on whether the employer has adopted the least intrusive means of meeting its operational requirements. In considering whether the employer had acted reasonably, fairly and in good faith in issuing the directive, the adjudicator noted that he had not been presented with any evidence establishing that standby duty was the employer’s only way of responding to emergencies on weeknights and weekends. But that is not the applicable legal test in this case. Requiring the employer to prove that there were no other alternatives to solve its problem imposes on it the far too onerous burden of proving a negative. As a result, to the extent that the adjudicator’s decision is based on a test that differs from the one applicable in law and that has the effect of imposing an excessive burden on the employer, it does not fall within a range of possible, acceptable outcomes which are defensible in respect of the law.

Reasons for judgment: Karakatsanis J. (McLachlin C.J. and Abella, Wagner, Gascon, Brown and Rowe JJ. concurring)

Reasons Dissenting in Part: Côté J. (Moldaver J. concurring)

Neutral Citation: 2017 SCC 55

Docket Number: 37014