The Supreme Court of Canada has clarified the relationship between general employment standards legislation and collective agreements. In Isidore Garon ltée v. Tremblay, two unions filed grievances alleging that two employers who had closed their businesses in Quebec had not provided sufficient notice as required by the Quebec Civil Code. The grievances ultimately made their way to the Supreme Court on the issue of whether arbitrators had jurisdiction to hear the disputes.
The majority decision of the court recognised two trends in the case law. One line of cases has concluded that individual negotiation and the general law have no place in matters relating to conditions of employment under collective agreements. The second line, culminating in the Supreme Court of Canada’s decision in Parry Sound, says that provisions of general law are not necessarily excluded. Under the principles in Parry Sound, certain norms, such as employment standards minimums, human rights provisions and the Charter, are implicitly included in collective agreements.
The court held that, on closer analysis, these two lines of cases can be reconciled. In the first line of decisions, the right relied on is incompatible with the collective scheme, while in the second, the norm is not only compatible with the collective agreement, but also incorporated into it. The court held that Parry Sound did not reverse the decisions in the first line of cases. Rather, the principle that emerges is that if a rule is incompatible with the collective labour relations scheme, it cannot be incorporated and must be disregarded. However, if the rule is compatible and if it is a supplementary or mandatory norm, the arbitrator will have jurisdiction to apply it.
Applying those principles to the relevant clause of the Civil Code, the majority held that the notice provisions were not compatible with the collective labour relations scheme, for three reasons:
- Conditions of employment in unionized environments are bargained for collectively, while the right to notice under the Civil Code is agreed on as an individual matter at the time of termination;
- Dismissal of unionized employees is limited and reinstatement is a common remedy, but where there is an individual employment relationship, an employer has a right to unilaterally dismiss an employee, with notice; and
- The legislative history indicated that the legislature did not intend all the rules relating to individual contracts of employment to be applicable to collective schemes.