Publication
On October 30, 2006, Professor Harry Arthurs, serving as a federally appointed Commissioner, delivered his report entitled "Fairness at Work: Federal Labour Standards for the 21st Century" ("Arthurs Report") to the federal Minister of Labour, the Honourable Jean-Pierre Blackburn. This report is the culmination of a mandate that was given to Commissioner Arthurs in October 2004 to review Part III of the Canada Labour Code ("Code"), to make recommendations for legislative changes in order to modernize federal labour standards and to ensure that Part III of the Code remains relevant and effective into the 21st century.
Although the government is not bound by any of Commissioner Arthurs' findings and recommendations, employers can expect that the Minister of Labour will consult with interested stakeholders and implement the recommendations on which there is consensus.
The Arthurs Report contains over 300 pages of analysis and nearly 200 recommendations for amendments to Part III of the Code or to the administrative procedures applicable to the enforcement of federal labour standards. All the recommendations may be found on our website at http://www.ogilvyrenault.com/en/ResourceCenter/ResourceCenterList.aspx?id=57. Click here for the full text of the Arthurs Report. The most salient of Commissioner Arthurs' recommendations are discussed below.
WHO IS SUBJECT TO FEDERAL LABOUR STANDARDS LEGISLATION
Commissioner Arthurs recommends that Part III of the Code should be amended to provide definitions of key terms including "employee", "independent contractor" and the new notion of "autonomous worker", which he suggests should be defined as a self-employed individual who performs services comparable to those provided by employees and under similar conditions, but whose contractual arrangements do not create an employment relationship.- Although many unions and employee advocate groups urged the Arthurs Commission to extend labour standards protection to all "dependent contractors" (in a manner analogous to the expanded definition of employee contained in Part I of the Code for labour relations purposes), Commissioner Arthurs adopted a more nuanced position on this issue, recognizing its complexity and the competing interests involved - especially in the trucking industry. Commissioner Arthurs proposes that Part III of the Code be amended to give the Minister of Labour jurisdiction to extend the application of all or part of Part III of the Code to "autonomous workers" in a given federally regulated sector of the economy, if this is the recommendation made following a "sectoral conference". (Commissioner Arthurs suggests that before implementing regulations directed to specific classes of employees or sectorally-based employees, the Minister of Labour should convene a sectoral conference to seek the input of interested parties in the sector. The Chair of the sectoral conference would be charged with making recommendations to the Minister of Labour, which the Minister could accept, in whole or in part, or reject.)
- Commissioner Arthurs recommends that all federally regulated enterprises be required to give all who perform services for the enterprise notice of their status as an employee, autonomous worker or independent contractor.
THE CONTRACT OF EMPLOYMENT
Commissioner Arthurs suggests that regulations be adopted under Part III of the Code requiring employers to provide non-unionized employees, when they are first hired and each time a material change to the employment contract occurs, with a written notice setting out the terms of their employment contract with respect to rates of pay, hours of work, general holidays, annual vacations and conditions of work.- The Commissioner recommends broadening the circumstances in which employers can legally set off certain unauthorized personal charges and fines incurred by employees against employees' wages.
- The Arthurs Report recommends broadening the scope of the successorship protection in Part III of the Code to provide continuity of employment, for purposes of Part III, in all situations (including a change of sub-contractors) where an employee continues to work in the business or where the services of an employee of a provincially regulated undertaking are transferred to a federally regulated employer.
HEALTH AND SAFETY AND HUMAN RIGHTS
Many union and employee advocates urged Commissioner Arthurs to recommend that Part III of the Code be amended to extend to employees protection against workplace psychological harassment in a fashion analogous to the provisions recently adopted by Quebec in the Labour Standards Act. Commissioner Arthurs rejected these submissions. Instead, he recommended that Part II of the Code (pertaining to health and safety) and its regulations be amended to define serious workplace abuse, bullying or harassment as an occupational hazard, and to establish appropriate procedures for forestalling and responding to such conduct.- Commissioner Arthurs also recommends that a series of administrative measures be adopted by the Labour Program and the Canadian Human Rights Commission to eliminate overlap and duplicate proceedings between the two regimes. He also recommends that federal labour inspectors be authorized to report violations of the Canadian Human Rights Act to the Canadian Human Rights Commission.
CONTROL OVER TIME: WORK/LIFE BALANCE
Many union and employee advocates urged Commissioner Arthurs to limit the flexibility federally regulated employers currently possess regarding scheduling to ensure workers can maintain appropriate work/life balance. Commissioner Arthurs rejected the more extreme of these suggestions and proposed the following principal amendments on hours of work issues:- amend Part II of the Code to ensure that no one (including managers, superintendents and professionals) be required to work so many hours as to endanger their health (without, however, recommending any specific limit);
- maintain the current norms of an eight-hour workday, forty-hour work week and a maximum work week of forty-eight hours and reword the statute in clearer terms and correct many of the technical difficulties in drafting;
- incorporate greater flexibility in the process for obtaining variations in the maximum hours of work and for obtaining the right to average hours by allowing four different options: a slightly amended permit-based system; the possibility of variation by the Minister by regulation following the recommendation of a sectorial conference; variation by a collective agreement; or variation in agreements arrived at following consultation with a workplace committee, representing non-unionized employees, and acceptance by more than 50% of the employees who vote on the proposal;
- introduce a cap on mandatory overtime at 48 hours per week or 12 hours per day and recognize individual employees' rights to refuse overtime to meet family obligations, attend scheduled educational commitments, or, in the case of a part-time employee, to work at other employment (unless an emergency exists);
- introduce a mechanism to enable employees and employers to agree on other hours of work (subject to the weekly maximum allowable hours);
- create a number of new unpaid leaves of absence or an extension of existing leaves (including ten days per year for family responsibilities, unlimited court or jury duty leave, five days per year for education leave, an additional four days' unpaid leave for bereavement and unlimited time off for medical appointments);
- increase vacation leave to four weeks for long service employees and provide all employees with the absolute right to schedule all leave in a single block;
- introduce a mandatory meal break, to be granted to all employees after five hours of work (to be paid if the employee is required to remain on the employer's premises);
- introduce mandatory unpaid short breaks for breastfeeding employees to feed their babies or to express milk;
- introduce mandatory time off between shifts of at least eight hours and a weekly rest period of at least thirty-two consecutive hours; and
- afford employers greater latitude to require extra hours of work by broadening the definition of an "emergency".
TERMINATION OF THE CONTRACT OF EMPLOYMENT
Employers' representatives urged Commissioner Arthurs to abrogate the unjust dismissal provisions of the Code or to at least increase the current length of service of one year required to access these protections. Employers also advocated decreasing the notice required for group terminations of smaller numbers of employees. Commissioner Arthurs rejected these proposals and instead made the following recommendations:- create a new adjudication services branch, that would employ permanent full-time hearing officers who would decide all unjust dismissal complaints or appeals from inspectors' orders under Part III of the Code;
- create new unfair labour practices for seeking to coerce or dissuade employees from exercising their rights under Part III of the Code or for dismissals that constitute reprisals for making a complaint under Part III of the Code or participating in its investigation;
- create an obligation for employees to give at least two weeks' notice of resignation; and
- increase severance entitlement to accumulate at the rate of three days per year after ten years' service from the current two days per year.
VULNERABLE WORKERS
Union and employee advocates urged Commissioner Arthurs to regulate terms and conditions of employment for part-time and temporary workers, including those hired through employment agencies. He adopted some of their suggestions and made the following recommendations:- amend Part III of the Code to make federal enterprises jointly and severally liable with temporary employment agencies for non payment of wages or benefits to temporary workers placed with the federal enterprise;
- adopt requirements for employers to offer permanent employment to temporary employees after one year of service on the same basis as probationary employees;
- amend Part III of the Code to require employers to pay part-time workers and temporary workers with at least one year's service the same wages as full-time workers with "equivalent jobs";
- that the Government explore the creation of a "benefits bank" through which smaller employers or individuals could purchase benefits coverage;
- adopt rules through the work permit system to require provincially regulated employers to provide better pay and working conditions for foreign domestic and agricultural workers; and
- adopt a federal minimum wage (that would be indexed to and adjusted automatically with inflation and tied to the low income cut-off or a similar standard).
ENFORCEMENT
Commissioner Arthurs recommends increasing the number of labour inspectors, developing an audit-based compliance process, giving the Labour Program (as opposed to the Department of Justice) authority to employ prosecutors, and increasing maximum fines from $5,000 to $50,000 for a first offence, $100,000 for a second offence and $250,000 for a third or subsequent offence. He also suggests that a very strict reverse onus provision be inserted in the Code.- Commissioner Arthurs proposes providing the Canada Industrial Relations Board with jurisdiction over the new unfair labour practices that he suggests should be introduced and that all other civil disputes under Part III of the Code should be heard by permanent hearing officers, employed by the Department of Human Resources and Social Development, or by grievance arbitrators, for unionized employees.
The Canadian Labour Congress has issued a press release, expressing approval of Commissioner Arthurs' Report. We encourage you to review the Report, and if there are any parts of it you agree with or dispute, to make your views known to the Minister of Labour, who is seeking input from both management and labour representatives.
We would be pleased to discuss any questions or comments you may have about the matters raised in this bulletin.
The purpose of this document is to provide information as to developments in the law. It does not contain a full analysis of the law nor does it constitute an opinion of Ogilvy Renault LLP or any member of the firm on the points of law discussed.
© Ogilvy Renault LLP 2006 - All Rights Reserved
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