Legal News

Labour Board Clarifies Section 54 Notice Requirements
November 4, 2003

On May 15, 2003, the British Columbia Government issued a request for proposals for the purchase of BC Rail Ltd. On August 15, 2003, the Government announced that it had short-listed four potential purchasers.

The Council of Trade Unions of BC Rail applied to the Labour Relations Board for an order directing BC Rail to comply with its obligations arising under section 54 of the Labour Relations Code as a result of the “impending sale of BC Rail.”

Section 54 of the Code requires an employer to provide sixty days notice to a trade union of any measure, practice or policy which affects the terms, conditions or security of employment of a significant number of employees represented by the union.

The Council argued that section 54 required BC Rail to provide it with sixty days notice of any agreement for the purchase and sale of BC Rail.

In rejecting this submission, the Labour Relations Board concluded that the Council’s position was an unreasonable and unrealistic interpretation of an employer’s obligations under section 54. Most employers will not know precisely when they will be entering into an agreement for the sale of their business and therefore will not be in a position to provide sixty days notice of any such agreement. More importantly, the sixty day notice requirement could shatter any secrecy in the negotiation process. This could adversely impact the employer and the employees.

The Board dismissed the Council’s complaint and determined that BC Rail was not required to provide sixty days advance notice to the Council of any agreement respecting the sale of BC Rail.

This decision confirms an earlier decision of the Board in Canada Safeway Limited, BCLRB No. B75/97. The effect of both decisions is that, in order to satisfy its obligations under section 54, an employer need only ensure that the effective or closing date of an agreement of sale is sufficiently far into the future so as to be able to provide sixty days notice of these events to the union representing the affected employees.

BC Rail Ltd. v. Council of Trade Unions of BC Rail BCLRB No. B351/2003.

(click here for full text of the judgment)