Connect

Legal News

Labour Relations Board Rules that Health Sector Employers Not Required to Discuss Alternatives to Contracting Out After Giving Notice of Change Under Section 54 of the Labour Relations Code
December 29, 2004

The Labour Relations Board has issued its reconsideration decision on the impact of section 54 of the Labour Relations Code on decisions to contract out in the health sector. The Board ruled that the employers were not required by section 54 of the Code to discuss alternatives to contracting out when the decision to contract out had already been finalized. However, the Board also held that unions have an avenue to discuss alternatives to planned changes before those changes are finalized, by activating consultation committee provisions that are contained in section 53 of the Code.

Section 54 of the Code requires an employer to provide a minimum of 60 days’ notice and to engage in adjustment discussions with the union when introducing a measure that will affect the terms, conditions or security of employment of a significant number of employees covered by the collective agreement.

In its original decision, the Board had held that the employers were required to discuss alternatives to contracting out with unions as part of workforce adjustment discussions required under section 54 of the Code. The Board stated that the decision to contract out was not “final” at the time section 54 notice was provided, because although the contracts had already been signed, they contained termination provisions which would provide the employers an opportunity to resile from the contracts.

In the reconsideration decision, the Board ruled that when contracts had been entered into prior to the minimum 60 days’ notice under section 54 notice being provided, the employers were not required to discuss alternatives to the decisions to contract out services.

However, the Board also ruled that there is an avenue for discussing alternatives to a planned change where a union activates the consultation provisions in section 53 of the Code.

Section 53 provides that on request by either party, a consultation committee must meet at least once every 2 months for the purpose of discussing issues relating to the workplace that affect the parties or any employee bound by the collective agreement. The Board concluded that under section 53, unions have an opportunity to raise and discuss an employer’s concerns about productivity and other matters before a final decision is made with respect to lay-offs or other measures. Once section 54 notice is provided, however, the employer is not required to discuss alternatives to a final decision on change with the union.

(Click here for copy of full judgment)