



COURT OF APPEAL FOR BRITISH COLUMBIA




Citation:



Langley (Township) v. Canadian Union of Public
  Employees, Local 403,









2017 BCCA 1




Date: 20170103

Docket: CA42610

Between:

Township of
Langley

Appellant

And

Canadian Union of
Public Employees, Local 403

Respondent






Before:



The Honourable Madam Justice D. Smith

The Honourable Madam Justice Bennett

The Honourable Mr. Justice Goepel




On appeal from: An
award of an arbitrator sitting as an arbitration board under the

Labour Relations Code
, R.S.B.C. 1996, c. 244 dated February 4,
2015,
Langley (Township) v Canadian Union of Public Employees, Local 403
.




Counsel for the Appellant:



D. Demerse
J.S. Russell





Counsel for the Respondent:



R.L. Edgar
T. Ramusovic





Place and Date of Hearing:



Vancouver, British
  Columbia

September 14 and 15,
  2016





Place and Date of Judgment:



Vancouver, British
  Columbia

January 3, 2017









Written Reasons by:





The Honourable Madam Justice D. Smith





Concurred in by:





The Honourable Madam Justice Bennett





The Honourable Mr. Justice Goepel








Summary:

The employer appeals from an
arbitrators decision upholding a grievance alleging that the terminations of
three out of twelve employees were discriminatory, contrary to s.13 of the
Human Rights Code. The employees were on long-term disability for an extended
period of time and none were able to return to work. The employer terminated
the employees for non-culpable absenteeism. The union grieved the terminations.

Held: appeal quashed. The
law with respect to non-culpable absenteeism was settled in Hydro-Qu
é
bec. Arbitrators have
discretion to consider labour relations principles under s. 82 of the
Labour Relations Code. In the application of the settled law, the arbitrator in
this case applied labour relations principles and found arbitrariness, randomness
and differential impact had undermined the BFOR put forward by the employer that
the employment relationship requires that employees work for pay. Although the
HRC is a matter of general law, the arbitrators reliance on labour relations
principles to determine the grievance meant that the real basis of the award
was about labour relations principles implied from the Labour Relations Code. Accordingly,
this Court is without jurisdiction to hear the appeal.

Reasons for Judgment of the Honourable
Madam Justice D. Smith:

Overview

[1]

On June 13, 2013, the appellant Township of Langley (the Employer)
terminated three employees who had been absent from work and on long-term
disability for just under 10, 8 and 7 years respectively. Each was totally
disabled from any occupation. Years earlier it had been determined that none
would be able to return to work. Their positions were posted and filled in June
2005, December 2005 and November 2008, respectively.

[2]

The terminations were the result of a review by the Employer in the
spring of 2013 of those employees who were on long-term disability (LTD) and
receiving employment benefits. At the time, there were 12 employees in that
category. The three employees in this case, along with a fourth employee, were
identified as having been absent from work for the longest period of time. The
first had been off work since 2003 and had three months of LTD remaining; the
second had been absent since 2004 and had 15 months of LTD remaining; and the
third had been away since 2007 and had 38 months left on the LTD plan. At the
Unions request, the Employer agreed not to terminate the fourth employee
because of her personal circumstances. That employee had 50 months of LTD
remaining.

[3]

The effect of the employees terminations was the loss of employment
benefits, including Medical Service Plan (MSP), extended health, dental and
group life insurance (the Employment Benefits). The Employment Benefits are co-paid
75% by the Employer and 25% by the employee. The terminations did not, however,
affect the employees receipt of LTD under a plan that their bargaining agent,
the respondent Canadian Union of Public Employees, Local 403 (the Union), selects
and administers for its members. The LTD plan provides coverage for 60% of a
members wages for up to 10 years or until age 65, whichever comes first. The
employees are members of the Union and will continue to receive LTD after their
terminations in accordance with the Unions plan.

[4]

The Employer and the Union are parties to a collective agreement (the
Collective Agreement). The Collective Agreement does not address when an
employees absence from work for illness or disability will be deemed
unreasonable for the purpose of termination. Consequently, the Union filed
grievances on behalf of the three members who were terminated contending,
inter
alia
, that their terminations were improper because the denial of the
Employment Benefits discriminated against the employees on the basis of
disability. The Employer conceded that the terminations were
prima facie
discriminatory,
but submitted they were justified on the basis of non-culpable absenteeism.

[5]

Non-culpable absenteeism can be a defence under s. 13(4) of the
Human
Rights Code,
R.S.B.C. 1996, c. 210 (the 
HRC
) to a finding of
prima
facie
discrimination under s. 13(1) of the
HRC.
Section 13(1)
prohibits a person from refusing to continue to employ a person because of a
prohibited ground, including physical or mental disability; such conduct is
prima
facie
discriminatory. Section 13(4) provides that s. 13(1) does not
apply if the refusal to continue a persons employment is based on a
bona fide
occupational requirement (BFOR).

[6]

In order to maintain the employment relationship an employee must work
for pay. The dismissal of an employee with an illness or disability, while
prima
facie
discriminatory, will be held to be non-discriminatory if an employer
establishes that the employee remains unable to work for the foreseeable
future even though the employer has tried to accommodate him or her:
Hydro-Qu
é
bec v. Syndicat des employ
é-e-s de techniques professionnelles
et de bureau dHydro-Québec, section locale 2000 (
SCFP-FTQ),
2008
SCC 43 at para. 18 [
Hydro-Qu
é
bec
].

[7]

The grievances filed by the Union on behalf the three employees were
heard by Arbitrator McPhillips (the Arbitrator). At the hearing, the Employer
acknowledged that the cost of continuing the Employment Benefits for these
employees was a significant consideration in its decision to terminate them.
However, the Employer maintained that the determining factor for its decision
was the permanent breakdown of the employment relationship with the employees.

[8]

On February 4, 2015, the Arbitrator found the terminations were discriminatory,
contrary to s. 13(1) of the
HRC.
He ordered the employees be
reinstated and made whole. During the course of his analysis, the Arbitrator
applied the well-established test from
British Columbia (Public Service
Employee Relations Commission) v. BCGSEU,
[1999] 3 S.C.R.

3 [
Meiorin
].
Having conceded there was
prima facie
discrimination, the
Meiorin
test
sets out the criteria by which an employer may justify the standard as a BFOR.
Those criteria include (at para. 54):

(i)         that
the employer adopted the standard for a purpose rationally connected to the
performance of the job;

(ii)        that
the employer adopted the particular standard in an honest and good faith belief
that it was necessary to the fulfilment of that legitimate work-related
purpose; and

(iii)       that the standard is
reasonably necessary to the accomplishment of that legitimate work related
purpose. To show that the standard is reasonably necessary, it must be
demonstrated that it is impossible to accommodate individual employees sharing
the characteristics of the claimant without imposing undue hardship upon the
employer.

[9]

The Arbitrator concluded that the Employer did not act in good faith in adopting
the requirement that these three employees attend work  the alleged BFOR. He
found that the manner in which the employees were terminated was (1) arbitrary;
(2) randomly applied; and (3) resulted in the disparate or
differential treatment of the employees.

[10]

On March 3, 2015, the Employer filed a notice of appeal to this Court
from the Arbitrators decision. The Employer submits the Arbitrator erred by:
(1) failing to apply the relevant authorities and the correct legal test to
the facts before him; and (2) failing to apply the well-established
Meiorin
test by adding extra criteria to the test. On the same date, the Employer
also filed an application to the Labour Relations Board (the Labour Board) for
a review of the Arbitrators decision in order to preserve the jurisdiction of
the Labour Board over this matter in the event this Court declined to take
jurisdiction.

[11]

These parallel streams for reviewing the decision of an arbitrator are mutually
exclusive, not concurrent jurisdictions. The vexing issue of which is the
proper forum for an appeal/review of an arbitrators decision is determined by
ss. 99 and 100 of the
Labour Relations Code,
R.S.B.C. 1996,
c. 244, Part 8 [
LRC
]. They provide:

99
(1) On application by a party affected by the
decision or award of an arbitration board, the board may set aside the award,
remit the matters referred to it back to the arbitration board, stay the
proceedings before the arbitration board or substitute the decision or award of
the board for the decision or award of the arbitration board, on the ground
that

(a) a party to the arbitration has
been or is likely to be denied a fair hearing, or

(b) the decision or award of the
arbitration board is inconsistent with the principles expressed or implied in
this code or another Act dealing with labour relations principles.



100
On application by a
party affected by a decision or award of an arbitration board, the Court of
Appeal may review the decision or award if the basis of the decision or award
is a matter or issue of the general law not included in section 99(1).

[12]

The legislative scheme, in effect, directs this Court to determine both
its jurisdiction and that of the Labour Board. The Labour Board will defer to
the Courts decision on jurisdiction in order to avoid concurrent jurisdictions
resolving the dispute:
Pinette & Therrien Mills Ltd. v. I.U.E.C., Local
82, B.C.L.R.B.
124/87. On May 7, 2015, the Labour Board granted the
Employers application that it be permitted to defer the adjudication of its
s. 99 application before the Labour Board pending the outcome of this
appeal:
Corporation of the Township of Langley and the Canadian Union of
Public Employees, Local 403,
[2015] B.C.L.R.D. No. 84.

[13]

The three-prong test for determining the question of jurisdiction under
ss. 99 and 100 of the
LRC
was summarized in
Kemess Mines Ltd. v.
International Union of Operating Engineers, Local 115,
2006 BCCA 58 at para. 17
[
Kemess Mines
], based on the judgment in
Health Employers Assn. of
B.C. v. B.C. Nurses Union,
2005 BCCA 343 [
Health Employers 2005
].
At paras. 49-50 the Court set out the analytical approach to be adopted on
this issue:

1.         Identify the real basis of the award;

2.         Determine whether the basis of the award is a
matter of general law;

3.         If the
basis of the award is a matter of general law, determine whether it raises a
question or questions concerning the principles of labour relations, whether
expressed in the Labour Relations Code or another statute.

If the answer to the third
question is affirmative, then review of the award lies within the jurisdiction
of the Labour Relations Board. If it is negative, review lies within the
jurisdiction of this Court.

[14]

For the reasons that follow, I am of the view that the jurisdiction to review
the Arbitrators decision falls to the Labour Board. The Arbitrators decision includes
a human rights analysis with respect to the nature and scope of an employers duty
under the
HRC
. That issue is clearly a matter of general law. I am persuaded,
however, that the real basis of his award concerns the layering of labour
relations principles (including the concepts of arbitrariness, randomness, and
differential impact) to his application of the well-settled human rights
principles from
Meiorin
and
Hydro-Qu
é
bec
for the purpose of addressing the honest
and good faith belief of the Employers work for pay standard. The basis of
the award involved an analysis of how, in the circumstances of these employees
and the process used by the Employer in this case, the labour relations
principles should interact with well-established general law on human rights. In
the result, the jurisdiction to review this issue must fall to the expertise of
the Labour Board and not the Court. Accordingly I would quash the appeal for
want of jurisdiction.

The Arbitrators Reasons

[15]

The Arbitrator addressed a number of issues that are not the subject
matter of this appeal. He then turned to the issue of whether the Employers
actions contravened s. 13 of the
HRC
,

noting that the
Employer conceded the terminations were
prima facie
discriminatory under
s. 13(1). He correctly articulated the three-step
Meiorin
test for
establishing a BFOR and then considered the Employers motivation for
terminating the employees in order to determine if the Employer had
demonstrated an honest and good faith belief that the BFOR standard in the
circumstances of this dispute was necessary.

[16]

The Arbitrator noted a number of concerns about the standard which
was applied by the Employer, including: (1) the absence of a
pre-determined measure or standard policy as to when the employment
relationship would be considered as ended; (2) the absence of any finding
with respect to the characteristics or circumstances of the individual
employees; (3) the motivation to save money from the payment of the
Employment Benefits, which he also found did not automatically constitute bad
faith or malice in the application of the BFOR; (4) the arbitrariness of
the Townships actions in deciding to terminate all three employees at a random
point in time; (5) the absence of a frustrating event in the Spring of
2013 that had altered the situation that had existed for years; and (6) the
differential or disparate treatment of the employees. Based on these factors,
the Arbitrator concluded that the Employer had not established an honest and
good faith belief that the BFOR was necessary. Therefore he held that the termination
of the three employees in June 2013 for non-culpable absenteeism was discriminatory.

[17]

These findings related to the first two steps of the
Meiorin
test,
which the Arbitrator reasoned were determinative of the matter. However, he went
on to consider the third step of the
Meiorin
test, namely whether further
accommodation would impose an undue burden or undue hardship on the Employer. The
Arbitrator relied on the
Hydro-Qu
é
bec
discussion with respect to non-culpable absenteeism, to conclude that the
point of undue hardship is reached when an employee can no longer provide any
labour, with or without accommodation; at that point the duty to accommodate
has been met (at p. 32). In the circumstances of these employees, he
reasoned, the duty to accommodate would have been fulfilled (at page 34). That
is to say, had he accepted that the Employers occupational requirement that
these employees, in their circumstances, had to show up for work, was a BFOR, their
terminations would have been non-discriminatory under the
Meiorin
test.

[18]

Thus, the substantive issue raised by the Employer in this appeal is
whether the Arbitrators consideration of labour relations principles 
including arbitrariness, randomness, differential treatment, the lack of a
frustrating event, and the Employers motivation to save money through these
terminations  in conjunction with his application of the
Meiorin
test,
had the effect of changing or modifying that well-established test.

Jurisdiction

[19]

The cumbersome dual system of mutually exclusive appeal/review processes
under ss. 99 and 100 of the
Code
has attracted a variety of
colourful descriptions. In
Health Employers Assn. of British Columbia v.
British Columbia Nurses Union,
2003 BCCA 608 [
Health Employers 2003
]
Madam Justice Southin characterized it as a brain teaser of the highest order
(at para. 3); in
Health Employers 2005,
Chief Justice Finch
referred to the awkward wording of ss. 99 and 100 (at para. 47); in
Chilliwack School District No. 33 v. Chilliwack Teachers Association,
2005
BCCA 411 [
Chilliwack
], Mr. Justice Esson described the elements
of ss. 99 and 100 as obtuse and notoriously brain-teasing; and in
Okanagan
College Faculty Assn. v. Okanagan College,
2013 BCCA 561 [
Okanagan
College
], Madam Justice MacKenzie described the issue of deciding the
real basis of the award as similar to deciding which leg of a table is the
real leg (at para. 85). Indeed, I think it fair to say that magnums of
ink have been spent on this subject, arguably with limited success in advancing
clarity on the matter. The root tensions would seem to still exist and must be
grappled with in each case.

[20]

While the legislation has not changed, this Courts understanding and
interpretation of its jurisdiction appears to have evolved since the seminal
decision of
Kinsmen Retirement Centre Association v. Hospital Employees
Union, Local 180
(1985), 63 B.C.L.R. 292 [
Kinsmen
]. Much of that
evolution has been animated by the historical concerns about courts adjudicating
on issues from specialized areas of the law where they had limited expertise or
where they were perceived as antagonistic to labour principles:
Chilliwack
at
para. 13; and
Castlegar & District Hospital v. British Columbia
Nurses Union,
2003 BCCA 608 at para. 110 [
Castlegar
]; see also
Castlegar
at paras. 19-26
per
Southin J.A., dissenting.

These
concerns continue to drive a constrained view of this Courts jurisdiction.

[21]

The issue in
Kinsman
was whether the employers requirement that
new employees join a pension plan, when existing employees had the option not
to do so, contravened a provision of the parties collective agreement. The
employees had grieved the issue and an arbitrator held that the collective
agreement did not require the new employees to comply with the employers
direction. The employer appealed, submitting that the arbitrator erred in law
in his interpretation of the collective agreement. The Court allowed the appeal
and set aside the arbitrators decision. Writing for the Court, Mr. Justice
Lambert explained the distinction between what are now ss. 99 and 100 of
the
LRC
:

[16]       the jurisdiction of
this court depends on the basis of the decision or award, and not on bringing
every link in the chain of reasoning leading to the decision of award within
the description a matter or issue of the general law. As was pointed out by
Chief Justice Farris and Mr. Justice Taggart in the A.I.M. Steel case, the
basis must mean the main constituent and not every constituent. In a
similar way, the jurisdiction of the Labour Relations Board depends on whether
the arbitration decision or award is inconsistent with the principles of the
Code or a labour relations statute. It is the real substance and determinative constituent
of the decision or award on which the Labour Relations Boards review
jurisdiction rests. I think that the wording of ss. 108 and 109 [now
ss. 99 and 100 respectively] was carefully chosen by the Legislature in
order to avoid having some parts of an award subject to review by the Labour
Relations Board and other parts of the award subject to review by this court,
with neither body having jurisdiction to consider the entire chain of reasoning
and to grant a remedy.

[22]

Thereafter, the Court appeared to adopt a more nuanced approach to this
issue as greater deference was accorded to the expertise of the Labour Board in
labour relations matters and as the Court engaged with the legislative intent animating
ss. 99 and 100. In
Health Employers 2003,
the Court declined to
take jurisdiction with respect to an appeal of a decision of a labour arbitrator
that it found principally involved the application of the general law as part
of the larger labour relations dispute between the parties concerning the
grievance of an employees dismissal under their collective agreement. Writing
for the majority, Mr. Justice Mackenzie stated:

[154]    In the result, however,
I do not think that the award at issue on this appeal is based on an issue of
general law outside s. 99(1). One must be careful not to bring every link
in the chain of reasoning leading to the decision or award within the description
a matter or issue of the general law:
Kinsmen,
para. 16. The
basis of an award does not mean every constituent:
A.I.M. Steel Ltd. v.
United Steelworkers of America Local 3495
(1975), 111 L.A.C. (2d) 116
(B.C.C.A.). Once the arbitrator found that the grievors conduct was
exclusively non-culpable, I am satisfied that his articulation of the duty to
accommodate was consistent with authority and did not raise any issue of general
law. The arbitrator then considered whether the employer fulfilled its duty to
accommodate, an inquiry that Huddart J.A. in my respectful view correctly
characterized as a factual issue in
Fording Coal
[
Westmin Resources
Ltd. v. C.A.W.-Canada, Local 3019,
1999 BCCA 534, sub nom.
United
Steelworkers of America v. Fording Coal
].

[23]

In
Health Employers 2005,
the Court decided it had jurisdiction
to review an arbitrators award with respect to the interpretation of s. 21
of the
Employment Standards Act,
R.S.B.C. 1996, c. 113 (the 
ESA
)
in circumstances where the employer wanted to recover the overpayment of wages
without filing a grievance under the parties collective agreement. Chief
Justice Finch, writing for a unanimous five-member court, explained that, while
the first two questions posed in
Kinsmen


namely the real basis
of the award and whether the basis of the award is a matter of general law 
were relatively straightforward to answer, the third question  that is
whether the award is inconsistent with principles expressed or implied in the
code or another Act dealing with labour relations  was more problematic. He reasoned
that the Court must (1) give effect to all of the words of the specific provisions
(i.e., ss. 99 and 100), which meant asking whether the award is
inconsistent with principles expressed or implied in the LRC or any other Act
dealing with labour relations; and (2) engage in a purposive
interpretation of the sections resulting in the analytical approach to jurisdiction
set out in
Health Employers 2005
(outlined in para. 13 above). He
concluded that the true basis of the arbitrators award was the interpretation
of s. 21 of the
ESA,
which was a matter of general law as it
affected all employees, whether unionized or not and that such an
interpretation was not inconsistent with any labour relations principle either
expressed in any Act or, in this case the
Employment Standards
Act (at para. 52).

[24]

In
Chilliwack,
the issue on appeal was whether an arbitrator, who
was appointed pursuant to the terms of the parties collective agreement, erred
in law by ordering the employer to disclose detailed notes of the reference
checks and interviews it made with respect to the unsuccessful candidate for
the position of school psychologist. The employer submitted the arbitrator
erred in law in failing to give effect to its obligation under the
Freedom
of Information and Protection of Privacy Act,
R.S.B.C. 1996, c. 165,
to ensure that personal information in its custody or under its control was not
disclosed without that individuals consent. The Court declined to take
jurisdiction. Writing for the majority, Mr. Justice Esson underscored the
narrow jurisdiction the Legislature had conferred to the Court under ss. 99
and 100, stating:

[13]      The legislative history
of sections 99 and 100 of the
Code 
the original provisions which were
proclaimed effective on January 14, 1974   and the general history of labour
relations in this Province in the preceding 75 years support the view that the
legislative intent in enacting sections 99 and 100 was to confer a narrowly
restricted jurisdiction upon the court.

[25]

Shortly thereafter, in
Kemess Mines Ltd. v. International Union of
Operating Engineers, Local 115,
2006 BCCA 58 [
Kemess Mines
], Chief
Justice Finch, writing for the Court, held that where the issue of substance
(a slightly different turn of phrase from the statutory language of s. 100
which states the basis of the decision or award) goes beyond the application
of the general law and concerns its interpretation, the Courts jurisdiction
under s. 100 will be engaged as human rights principles must apply
equally to unionized and non-unionized workplaces (at para. 24).

[26]

In
Communications, Energy & Paperworkers Union of Canada, (CEP)
Local 789 v. Domtar Inc.
2009 BCCA 52 [
Domtar
], the Court elaborated
on this distinction between the interpretation and the application of the human
rights principles. There, the Court had to determine whether it had the
jurisdiction to hear an appeal from an arbitrators decision to dismiss the
grievance of eight employees on LTD, who were denied severance pay when the employer
Domtar closed its paper mill in a manner that was allegedly discriminatory
under the
HRC.
After referring to the distinction between interpretation
and application of a human rights principle from
Health Employers 2005,
Madam
Justice Levine, for the Court observed:

[34]      Thus,
the recent jurisprudence of this Court on
the jurisdiction question has reflected a broad approach where an arbitrator
has interpreted human rights principles
, including the meaning and legal
elements of prima facie discrimination, and the scope and nature of the duty to
accommodate.
Where, however, the arbitrators decision concerned the application
of human rights principles to the facts as found by the arbitrator, the Court
has found that it does not have jurisdiction to review the arbitrators
decision.

[Emphasis added.]

[27]

The high-water mark for deference and restraint by this Court in this
area is found in
United Steelworkers Local 9346 (Elkview Operations) v. Teck
Coal Limited
, 2013 BCCA 485 [
Teck Coal
]. The issue in
Teck Coal
was whether the Court had jurisdiction to hear an appeal by the union from
an arbitrators dismissal of its application for an order preventing Teck from
implementing random drug-testing of its employees. The parties had agreed that
the real basis of the decision is the application of the test for such an
order under s. 92(1)(c) of the
Code
 (at para. 22). This triggered
the issue of whether the application of this test is a matter of general law,
and if so, whether this raises a question or questions concerning the
principles of labour relations (at para. 23).

[28]

Madam Justice Bennett, writing for the Court, stated that an issue of
general law was one that affects the community at large a law that
embraces a class of subjects or places and does not omit any subject or place
naturally belonging to that class,
Blacks Law Dictionary,
4
th
ed. (at para. 24). While injunctive relief was held to be clearly a
question of general law, that finding on its own did not end the analysis. Instead,
relying on
Nor-Man
, Bennett J.A. reasoned that the arbitrators ability
to adapt and apply common law doctrines flexibly cannot be overlooked when
assessing whether the application of the general law principles  falls within
s. 99(1) (at para. 36). Thus, where the arbitrator is applying the
general law in a manner that is adapted to the labour relations context, review
will lie with the Labour Board. Bennett J.A. noted that the Courts
jurisdiction was narrow in scope (relying on
Chilliwack
), and that the
comments of Mr. Justice Fish in
Nor-Man Regional Health Authority Inc.
v. Manitoba Association of Health Care Professionals
, 2011 SCC 59 [
Nor-Man
]
supported this view:

[35]      Justice Fish specifically addresses an arbitrators
ability to adapt and apply common law principles to the labour law context:

[45]       labour arbitrators are authorized by their broad
statutory and contractual mandates and well equipped by their expertise to
adapt the legal and equitable doctrines they find relevant within the contained
sphere of arbitral creativity. To this end, they may properly develop doctrines
and fashion remedies appropriate in their field, drawing inspiration from
general legal principles, the objectives and purposes of the statutory scheme,
the principles of labour relations, the nature of the collective bargaining
process, and the factual matrix of the grievances of which they are seized.

[46]      This flows from the broad grant of authority
vested in labour arbitrators by collective agreements and by statutes such as
the [Manitoba]
LRA,
which governs here. Pursuant to s. 121 of the
LRA,
for example, arbitrators and arbitration boards must consider not only the
collective agreement but also the real substance of the matter in dispute
between the parties. They are 
not bound by a strict legal interpretation
of the matter in dispute.
And their awards provide a final and conclusive
settlement of the matter submitted to arbitration.

[Emphasis in the
original reasons of Fish J.]

[29]

The final decision in this review is
Okanagan College Faculty Assn.
v. Okanagan College,
2013 BCCA 561 [
Okanagan College
]. In
Okanagan
College
the Court declined to take jurisdiction in an appeal by a union
from an arbitrators award dismissing its grievance with respect to the
employers refusal to allow employees on maternity or parental leave to accrue
teaching load units. The union submitted the arbitrators decision was an error
in law as it contravened the collective agreement and/or the
HRC.

[30]

Speaking for the Court, Madam Justice MacKenzie discussed the importance
of the interpretation/application distinction in the jurisprudence. While
characterizing an arbitrators decision as an application or interpretation of
general law remains part of the analysis, MacKenzie J.A. added two further
considerations: (1) an application of the law that required a limited
amount of interpretation with respect to how the general legal principles
should be applied in the context of a given case (at para. 58), would not
convert such an application to an interpretation of the law as contemplated in
Domtar
;
and (2) in any event, the interpretation/application distinction was not
determinative but rather was a useful heuristic, stating:

[57]      It seems to me this application is premised on the
notion that where legal interpretation of the general law has largely been
accomplished in advance of the arbitrators award, it will be the arbitrators
conclusions as to the factual or interpretive context in which the alleged
discrimination took place that will really drive the outcome, and therefore serve
as the basis of the award.

[58]      Of course, any application of the general law, to
some extent, requires an interpretation of what the law requires in that
specific context, and how general principles should be applied in the context
of a given case. It might be said that every case, in the absence of clear and
binding authority on the very point in issue, involve
some
[emphasis in
original] interpretation of what the law requires, if only in finding the case
at hand meets the legal standards established.
I do not take the distinction
between interpretation and application in Domtar as categorical, but rather a
useful heuristic in determining the true nature or basis of an arbitrators
conclusion. The more the assessment undertaken by an arbitrator relies on
settled principles of law, and the more the analysis depended on the particular
context of the case in hand, the more it will be considered an application of
the general law, as opposed to its interpretation.

[Emphasis added.]

[31]

In
Okanagan
, MacKenzie J.A. had to identify which of the multiple
real bases of an award was the true real basis. In doing so, she partially
rested her conclusion on the application/interpretation distinction: paras. 46,
54. Thus, despite expressing caution about the distinction, MacKenzie J.A.
recognized its use as a tool to determine jurisdiction.

Role of the Arbitrator

[32]

Consideration of this Courts jurisdiction on appeal from a labour
arbitrator would not be complete without consideration of the specific goal of
arbitration, and the role of the arbitrator.

[33]

Section 82(1) of the
LRC
sets out the purpose of arbitration. It
provides:

82  (1) It is the purpose of this Part to constitute methods
and procedures for determining grievances and resolving disputes under the
provisions of a collective agreement without resort to stoppages of work.

(2) An arbitration board, to further the purpose
expressed in subsection (1), must have regard to the real substance of the
matters in dispute and the respective merit of the positions of the parties to
it under the terms of the collective agreement, and must apply principles
consistent with the industrial relations policy of this Code, and
is not
bound by a strict legal interpretation of the issue in dispute.

[Emphasis added.]

[34]

A labour arbitrator has a different mission from that of a court. This
difference in roles was explained by Fish J. in
Nor-Man
. In
Nor-Man,
the
arbitrator found the employer had misinterpreted the collective agreement for
many years but concluded the union was estopped from obtaining remedial relief
because of its long-standing acquiescence. On judicial review, the Manitoba
Queens Bench declined to interfere with the arbitrators decision; the Manitoba
Court of Appeal allowed the appeal and reviewed the decision on a standard of
correctness, concluding that the arbitrator had failed to correctly apply the
law of estoppel. The Supreme Court of Canada set aside the Court of Appeals
decision. Fish J. stated that [l]abour arbitrators are not legally bound to
apply equitable and common law principles ― including estoppel ― in
the same manner as courts of law. Theirs is a different mission, informed by
the particular context of labour relations (at para. 5). He explained:

[6]        To assist them in the
pursuit of that mission, arbitrators are given a broad mandate in adapting the
legal principles they find relevant to the grievances of which they are seized.
They must, of course, exercise that mandate reasonably, in a manner that is
consistent with the objectives and purposes of the statutory scheme, the
principles of labour relations, the nature of the collective bargaining
process, and the factual matrix of the grievance.

[35]

The reasons of Fish J. call into consideration the administrative law
principle of reasonableness from
Dunsmuir v. New Brunswick
, 2008 SCC 9. The
arbitrators different mission from the Court, the requirement that
reasonableness be used in reviewing an arbitrators decision, and the need for
deference to be given to the arbitrators expertise, in my respectful view calls
for a cautionary approach from this Court where an arbitrator may have layered
labour relations principles on top of his or her application of the general
law.

Summary

[36]

This Courts jurisdiction pursuant to s. 100 of the
LRC
will
be satisfied when the appellant establishes that: (1) the real basis of
the decision or award to be appealed involves the application or interpretation
of a matter or issue of the general law; and (2) that the matter or issue does
not include a dispute about whether the decision to be appealed is
inconsistent with the principles expressed or implied in this Code or another
Act dealing with labour relations. When the interpretation/application tool is
factored in, an interpretation of the general law that does not involve a
consideration of labour relations principles will fall to be determined by this
Court and not the Labour Board. However, an application of the general law that
also requires a consideration of labour relations principles applicable to the
circumstances of the dispute will be accorded deference by this Court, and will
fall to the Labour Board for determination. That is to say, this Court may demonstrate
the required deference with respect to an arbitrators application of labour
relations principles by acceding to the jurisdiction of the Labour Board for
the review of an arbitrators decision on those matters.

Application

[37]

The Arbitrators decision involved an application of well-established legal
principles with respect to the interpretation of s. 13 of the
HRC
to
the circumstances of these employees. As a matter of general law, an employer
may terminate an employee for non-culpable absenteeism. Work for pay is a BFOR
that is an essential feature of the employment relationship. Human rights
legislation does not alter this fundamental bargain:
Hydro-Québec
at para. 15.
It is not discriminatory to terminate an employee who is unable to comply with
this fundamental bargain, provided the employer has met its obligation to
accommodate that employee. Those who cannot meet the BFOR of attendance for
work by reason of a protected ground (such as illness or disability) under the
HRC
,
can legitimately be terminated where the duty to accommodate has been discharged
.
The employers obligation in these circumstances continues only to the
point that it may do so without experiencing undue hardship and ends where the
employee is no longer able to fulfill the basic obligations associated with the
employment relationship for the foreseeable future:
Hydro-Québec
at paras. 16
and 19.

[38]

Nothing in these reasons should be interpreted as questioning the
validity of non-culpable absenteeism as it has been recognized by the Supreme
Court of Canada in
Hydro-Québec
. Indeed, the Arbitrator found that in
the circumstances of this case, where the employees had been unable to work because
of their disabilities for almost 10, 8 and 7 years respectively, the Employer
had no further duty to accommodate their disabilities.

[39]

However, the Arbitrator extended his analysis beyond the simple
application of non-culpable absenteeism, as he was entitled to do under
s. 82 of the
LRC.
He examined how the
Meiorin
test should be
applied in the context of this labour relations dispute. In applying the
Meiorin
test, he focused on the process by which the Employer determined that these
three employees should be terminated. Applying labour relations principles, he
concluded that the process followed by the Employer was arbitrary, random, and
resulted in disparate or differential treatment of the employees, implying that
the Employer had acted unreasonably and not in good faith in enforcing the attendance
at work as a requirement of their jobs. In these circumstances, because of questions
concerning the process by which the employees were terminated, the Arbitrator found
that their requirement to attend at work was not a BFOR. Accordingly, he held
the terminations were discriminatory as the Employer had not established a BFOR
to rebut the
prima facie
discriminatory terminations.

[40]

In my opinion, it is not for this Court to wade into the issue of
whether the Arbitrators determination with respect to his application of the
Meiorin
test to the circumstances of the employees terminations was correct or
reasonable, as that determination engages a consideration of labour relations
principles. Those principles as they apply to this dispute are properly left to
the expertise of the Labour Board for review. This conclusion does not in any way
change the general law in
Hydro-Québec,
which remains applicable in both
forums. Deference, however, must be accorded to the Labour Board on the
application of labour relations principles.

[41]

I would quash the appeal for want of jurisdiction.

The
Honourable Madam Justice D. Smith

I AGREE:

The Honourable Madam Justice
Bennett

I AGREE:

The Honourable Mr. Justice
Goepel


