On November 14, 2014, the Supreme Court of Canada issued a three sentence decision that has important implications for Canadian employers who provide “top ups” to employees during pregnancy, parental and adoption leave. This case is significant because it suggests that pregnant employees cannot be denied a parental leave benefit simply because they enjoy a “similar” pregnancy leave benefit. In some cases, this may require employers to provide additional benefits to employees who take both pregnancy and parental leave.

In British Columbia Teachers’ Federation v. British Columbia Public School Employers’ Association, 2014 SCC 70 (“BC Teachers’ Federation”), the Supreme Court endorsed an arbitrator’s decision that required an employer to provide pregnant mothers with two 15-week periods of salary top up (in addition to an initial 2-week top up) under the following provision of a collective agreement:

…The Board shall pay a pregnant employee who takes pregnancy leave pursuant to the pregnancy leave provisions of the Employment Standards Act…(or to a parent who qualifies for Employment Insurance benefits for birth or adoption) 95% of the employee’s current salary for the first two (2) weeks of the leave, [and]

THEREAFTER…

For a further fifteen (15) weeks, the Board shall pay the employee the difference between 70% of the employee’s current salary and the amount of E.I. benefits received by the employee.

On its face, this provision appears to provide one 15-week top up to new parents. However, for reasons summarized below, the Supreme Court endorsed the view that, under this provision, a pregnant employee is entitled to collect the 70% salary top up twice—once for a 15-week period during pregnancy leave, and again for a 15-week period during a parental leave.

The Case

The British Columbia Teachers’ Federation and Surrey Teachers’ Association (the “union”) filed a grievance on behalf of three teachers under the provision of the collective agreement set out above. Each of the three teachers took both pregnancy and parental leave, and collected employment insurance benefits during their leaves. The British Columbia Public School Employers’ Association and Board of School Trustees of School District No. 36 (the “employer”) provided only one 15-week top up to each of the three grievors.

At grievance arbitration, the employer argued that the top up provision simply provided all new parents, including pregnant mothers, with a single 15-week top up, and that this amounted to fair and equal treatment of all its employees. The union, on the other hand, argued that it was discriminatory to deny pregnant mothers who take both pregnancy and parental leave a second top up, contrary to the Human Rights Code and the Canadian Charter of Rights and Freedoms.

The arbitrator sided with the union.

The arbitrator’s reasoning begins with a distinction between pregnancy leave and parental leave. The purpose of pregnancy leave (and a pregnancy leave top up) is to promote the health and well-being of pregnant women and new biological mothers while they undergo the physical and psychological stresses of giving birth. The purpose of parental leave (and a parental leave top up), on the other hand, is to provide income to parents while they are caring for, and bonding with, their child during its critical first year of life.

Because pregnancy and parental leave serve two distinct purposes, the effect of the employer’s interpretation of the collective agreement was found to be discriminatory. Should a pregnant mother be denied a “child care and bonding benefit” simply because she enjoyed a “health and well-being benefit”? According to the arbitrator, no. It is arbitrary and discriminatory to deny a pregnant mother a parental leave benefit simply because she enjoyed an ostensibly similar pregnancy leave benefit.

The Implications

Although BC Teachers’ Federation is an important case, it is important to put it into perspective. The Supreme Court of Canada did not comment on the arbitrator’s reasoning or provide further guidance to employers who administer top up policies. The court merely affirmed the arbitrator’s decision, finding that the arbitrator was “entitled to reach the conclusions that he did” and that there was “no reason to interfere” with his decision.

That said, this case is significant to employers who offer their employees a top up policy. A single top up benefit that is provided “equally” to all employees each time they become a parent should be carefully evaluated to ensure it is not “effectively” discriminatory to employees who take both pregnancy and parental leave.

Moreover, the reasoning that is applied to top ups in this case can be applied to other benefits that are associated with pregnancy and parental leaves, including, for example, health and dental benefits that are continued during such leaves. We will be watching future cases to see whether the reasoning in BC Teachers’ Federation is expanded in this way.

If you have any concerns about the implications of this case for the benefits policies in your workplace, we encourage you to contact a member of our team.

Many thanks to Alex Lemoine for his assistance in drafting this article.