Judgments

[1995] 3 F.C. 354

A-333-94

Byers Transport Limited (Appellant)

v.

Dorothy Kosanovich and Clint S. Mellors (Respondents)

Indexed as: Byers Transport Ltd. v. Kosanovich (C.A.)

Court of Appeal, Marceau, Strayer and Linden JJ.A.—Edmonton, June 20; Ottawa, July 18, 1995.

Labour relations — Respondent fired ostensibly to reduce costs, but believed due to perceived support of unionization of office staff — Filing unjust dismissal complaint under Canada Labour Code, s. 240, unfair labour practices claim under s. 97, but discontinuing latter — S. 242(3.1)(a) prohibiting consideration of complaint where lay-off due to discontinuance of function — S. 242(3.1)(b) prohibiting consideration where procedure for redress provided elsewhere — Adjudicator finding no discontinuance of function as redistribution of work made in bad faith — Finding of unjust dismissal based on jurisdictional finding — Trial Judge holding Adjudicator’s decision not “patently unreasonable” — Disagreeing s. 242(3.1)(b) applied — Although Judge applied wrong standard of review of jurisdictional decision, no reviewable error as to application of s. 242(3.1)(a) — Redistribution of work discontinuance of function only if done in good faith — Evidence supporting finding improper motive for redistribution — As limitation on jurisdiction, s. 242(3.1)(b) had to be considered — S. 97 alternative procedure for redress even if remedies not same — Part III procedure residual — Should be pursued only if unable to establish unfair labour practice.

Practice — Costs — Adjudicator finding unjust dismissal, awarding reinstatement, costs against employer — Trial Judge dismissing judicial review application, upholding award of costs, awarding solicitor-client costs on judicial review application — Employer reversing position before Court of Appeal re: reason for termination — Greatly contributing to costs, necessity for judicial review — Solicitor-client costs on judicial review, appeal awarded employee though unsuccessful in F.C.A.

This was an appeal from the dismissal of an application to set aside the Adjudicator’s finding of unjust dismissal. The respondent, Kosanovich, was fired when the Teamsters Union was trying to unionize the office staff where she worked. Management’s position was that her job had been eliminated to “reduce costs”, but the respondent believed that she was fired because of perceived union sympathy. She filed a complaint of unjust dismissal under Canada Labour Code, section 240 (in Part III of the Code). She also filed a complaint under section 97 (in Part I) that the appellant had committed an unfair labour practice in dismissing her for perceived union activities. The employer and the union agreed on a settlement of the latter complaint, but Kosanovich rejected it and eventually withdrew the section 97 complaint. At the section 240 hearing the employer took the position that the dismissal was part of a cost-cutting, down-sizing process. This gave rise to a question as to whether the Adjudicator had jurisdiction to deal with the complaint in view of subsection 242(3.1) which prohibits an adjudicator from considering a complaint if the lay-off was due to a lack of work or discontinuance of a function. Paragraph 242(3.1)(b) prohibits consideration of a complaint where a procedure for redress has been provided elsewhere under an Act of Parliament. The employer did not raise any issue based on paragraph 242(3.1)(b) before the Adjudicator and the Adjudicator made no mention of it in his decision. The Adjudicator found that there had been neither “lay-off” nor discontinuance of the respondent’s function because the redistribution of her work was made in bad faith, namely for perceived union activity. The Adjudicator ordered reinstatement, payment of outstanding wages and benefits, and costs. He treated the determination of the jurisdictional issue as determinative of the fact of unjust dismissal. Thus the ground for the unjust dismissal finding was that the respondent had been fired for perceived union activity. The Trial Judge held that the Adjudicator’s decision was not “patently unreasonable”, confirming that the Adjudicator had applied the correct test as to “lay-off” and “discontinuance of a function”. His Lordship disagreed with the employer’s argument that paragraph 242(3.1)(b) ousted the Adjudicator’s jurisdiction. He upheld the award of costs and awarded costs on a solicitor-client basis on the judicial review.

The issues were: whether patent unreasonability or correctness is the test for review of jurisdictional decisions; whether the Adjudicator lacked jurisdiction by virtue of paragraph 242(3.1)(a) or (b); and whether the respondent was entitled to the award of costs before the Adjudicator and solicitor-client costs before the Trial Judge.

Held (Marceau J.A. dissenting), the appeal should be allowed.

Per Strayer J.A. (Linden J.A. concurring): The standard of review of a finding as to the existence of jurisdiction is that of correctness, notwithstanding the privative clause in section 243.

There was no reviewable error as to the application of paragraph 242(3.1)(a) even when the proper standard of review, correctness, was applied. The Trial Judge correctly concluded that the Adjudicator’s conclusion that there was no “discontinuance of a function” disclosed no reviewable error. Redistribution of the former work of a person laid off is a discontinuance of function only if done in good faith for proper purposes such as down-sizing and economy. There was substantial evidence supporting the Adjudicator’s finding that the motive for the redistribution was to get rid of the respondent because of her perceived support for the unionization of office workers. He applied the correct legal principles to that proper finding of fact and found that there was no discontinuance of a function within paragraph 242(3.1)(a).

Paragraph 242(3.1)(b) constitutes a limit on the Adjudicator’s jurisdiction. The Adjudicator had an obligation to consider whether he was barred by paragraph 242(3.1)(b) from considering the complaint. He was not excused from considering that question by the silence or consent, expressed or implied, of the parties. The fact that he did not consider it did not preclude, or excuse, this Court from determining whether he was acting within his jurisdiction.

The Trial Judge erred in denying the paragraph 242(3.1)(b) objection. Section 97 provides a “procedure for redress” of a complaint of dismissal for perceived union activity under subsection 94(3) which prohibits prejudicial treatment of employees “because” of their union activity. The complaint (i.e. the factual situation complained of) must be essentially the same in the other “procedure for redress”, but the remedies do not have to be as good or better under the other provision to oust the jurisdiction of the adjudicator under paragraph 242(3.1)(b). That paragraph does not require that the same redress be available under another provision of the Canada Labour Code or some other federal Act, but that there be another procedure for redress. That procedure must be capable of producing some real redress which could be of personal benefit to the same complainant.

Where Parliament has established specialist tribunals, whether under the Canada Labour Code or elsewhere, to deal with certain aspects of employer-employee relationships, it should not be taken to have conferred concurrent jurisdiction on ad hoc adjudicators to deal with the same matter. The procedure in Part III for the filing of complaints by non-unionized employees for unjust dismissal, for hearing by an adjudicator, is a residual procedure intended to provide some redress where such redress was not otherwise available. As the Part III remedy is residual, the Part I complaint should be prosecuted first. Only if unable to establish an unfair labour practice as the cause for dismissal should the Part III complaint be pursued. The respondents herein failed to pursue the Part I complaint to its conclusion.

Costs on the judicial review and this appeal should be awarded against the employer on a solicitor-client basis. The appellant’s reversal of its position since the beginning of the adjudication, which greatly contributed to the respondent’s costs and the necessity for judicial review, warranted this award.

Per Marceau J.A. (dissenting): The Trial Judge correctly found that the Adjudicator’s jurisdiction to deal with the respondent’s complaint of unjust dismissal was not ousted by either paragraph 242(3.1)(a) or (b). As to the former, the Adjudicator’s findings of fact were decisive. It is the interpretation given to a provision of law by the tribunal which is subject either to the “patent unreasonability” or “correctness” test, depending upon whether the provision is determinative of jurisdiction. On pure questions of fact, the deference due by a reviewing court to the finder of fact below remains, regardless of the nature of the proceedings, and it can only be made more compelling by the presence of a privative clause protecting the decision of the lower tribunal. Mere findings of fact were under attack before the Trial Judge on the branch of the Adjudicator’s decision dealing with paragraph 242(3.1)(a), i.e. that there had been no lay-off for economic or administrative reasons, but termination for the employee’s perceived sympathy for the union. Such findings were unimpeachable if there was some evidence to support them.

The limitation contained in paragraph 242(3.1)(b) was not applicable since there was no other available procedure for redress considering the complaint as it was presented and sustained.

The application of the interdiction contained in paragraph 242(3.1)(b) is dependent on an allegation of unfair labour practice made at the outset or apparent from the initial allegations. The revelation by the employee of a mere suspicion to that effect, flatly denied by the employer, does not have the same effect. The provision prevents a hearing from taking place. If the adjudicator is to be prevented from hearing the complaint, the determination regarding his jurisdiction must be made at the outset. The Code does not require the adjudicator to make a finding regarding the employer’s motives. Section 240 is meant to protect non-unionized employees against dismissal for no valid reason. That is all that is required to be alleged and proved in order to find the complaint justified. A finding that the only reason given by the employer is not to be believed is complete and final and puts an end to the inquiry.

Section 94 did not offer the respondent another “procedure for redress”. Subparagraph 94(3)(a)(i) prevents an employer from punishing an employee because that employee proposes to join a trade union or participate in its activities. It does not say “have mere sympathy for a trade union”, as was the case here. Punishment for a “platonic” sympathy for anything is wrong. The labour oriented Part I of the Code was not meant to sanction wrongful punishment of an employee. The Canada Labour Relations Board was specifically assigned jurisdiction to deal with unfair labour practices because these were matters thought to be appropriate for determination by a specialized tribunal. Its expertise in labour legislation and activities is not required to determine that the firing of an employee because of his or her intellectual sympathy for the union is unacceptable.

STATUTES AND REGULATIONS JUDICIALLY CONSIDERED

An Act to amend the Canada Labour Code, S.C. 1972, c. 18, s. 1.

An Act to amend the Canada Labour Code, S.C. 1977-78, c. 27, s. 21.

Canada Labour Code, R.S.C., 1985, c. L-2, ss. 8, 94, 97 (as am. by S.C. 1991, c. 39, s. 2), 98(1), 99(1) (as am. idem, s. 3), 240 (as am by R.S.C., 1985 (1st Supp.), c. 9, s. 15), 241(2), 242(3.1) (as enacted idem, s. 16), (4), 243, 246.

Canadian Human Rights Act, R.S.C., 1985, c. H-6.

Civil Service Act, S.N.B. 1984, c. C-5.1, s. 26(1).

Federal Court Rules, C.R.C., c. 663, R. 1618 (as am. by SOR/92-43, s. 19).

Industrial Relations and Disputes Investigation Act (The), S.C. 1948, c. 54, s. 4.

CASES JUDICIALLY CONSIDERED:

APPLIED:

Canada Post Corp. v. Pollard, [1994] 1 F.C. 652 (1993), 161 N.R. 66 (C.A.); affg [1992] 2 F.C. 697 (1992), 53 F.T.R. 113 (T.D.); Fleiger v. New Brunswick, [1993] 2 S.C.R. 651; (1993), 104 D.L.R. (4th) 292.

CONSIDERED:

Sagkeeng Alcohol Rehab Centre Inc. v. Abraham, [1994] 3 F.C. 449 (1994), 79 F.T.R. 53 (T.D.).

REFERRED TO:

Sedpex, Inc. v. Canada (Adjudicator appointed under the Canada Labour Code), [1989] 2 F.C. 289 (1988), 34 Admin. L.R. 23; 25 F.T.R. 3 (T.D.).

APPEAL from the dismissal of an application to set aside an Adjudicator’s finding of unjust dismissal ((1994), 81 F.T.R. 110 (F.C.T.D.)). Appeal allowed.

COUNSEL:

Michael W. Hunter for appellant.

Wendy A. Danson for respondents.

SOLICITORS:

Russell & DuMoulin, Vancouver, for appellant.

McCuaig Desrochers, Edmonton, for respondents.

The following are the reasons for judgment rendered in English by

Marceau J.A. (dissenting): I have had the advantage of reading the reasons for judgment prepared by my brother Strayer. Unfortunately, I cannot agree with him. With respect, I see no error in the judgment of the Trial Division [(1994), 81 F.T.R. 110] and I would uphold it. Here, briefly, are my reasons for taking that view.

It would serve no purpose to go through the facts again. The recital in my colleague’s reasons is adequate and I simply refer to it. It could be useful, however, in order to give a complete picture of the context, to note that the respondent filed her complaint under Part I of the Canada Labour Code[1] (the Code) more than two months after she had filed her first one under Part III, and that she did so at the instigation of the union which then, without her participation, negotiated a settlement with the employer that she promptly refused, obviously because she felt her personal predicament was not properly addressed. To review the two decisions below, the impugned Trial Division order dismissing the application for judicial review and the Adjudicator’s determination, would also be useless; my colleague has properly identified their main aspects and it should be sufficient for me to underscore some of them in the course of my analysis. As to the relevant legislation in the Code, only subsection 242(3.1) [as enacted by R.S.C., 1985 (1st Supp.), c. 9, s. 16] need be reproduced immediately, it being the provision central to the litigation:

242. …

(3.1) No complaint shall be considered by an adjudicator under subsection (3) in respect of a person where

(a) that person has been laid off because of lack of work or because of the discontinuance of a function; or

(b) a procedure for redress has been provided elsewhere in or under this or any other Act of Parliament.

So, I take for granted that the factual, judicial and legislative context in which the issues to be determined arise is established, and I will proceed immediately to set forth my personal views on them.

The first issue is whether the learned Motions Judge erred in law in approving the Adjudicator’s conclusion that he was not denied jurisdiction by virtue of paragraph 242(3.1)(a) of the Code. In giving his approval, the Motions Judge simply stated [at page 114] that it was not “patently unreasonable” for the Adjudicator to conclude as he did, having found that the claimant-respondent had not been laid off following a discontinuance of her function as alleged by the employer, but had been terminated for no apparent reason other than her perceived sympathy for the union. That was, in the appellant’s submission, the wrong test since the standard of review of an inferior tribunal’s conclusion relative to its own jurisdiction is not the “patent unreasonableness” of his finding but the “correctness” thereof. My colleague concedes that the Trial Judge was wrong as to the standard of review but he does not believe that the application of the “correctness” test would have yielded any different result.

I readily agree with my colleague that the Trial Judge’s approval of the Adjudicator’s conclusion with respect to the possible application of paragraph 242(3.1)(a) of the Code was wholly justified. My approach, however, is different from his. The test openly applied by the Motions Judge was not too lenient. In my view, it was not deferential enough. As I understand it, the jurisprudential pronouncements as to the standard of review of an inferior tribunal’s disposition of a preliminary or incidental question arising in the course of exercising its duties are concerned with the legal component of the question, not the factual one. In other words, it is the interpretation given to a provision of law by the tribunal which is subject either to the “patent unreasonability” test or to the “correctness” test according to whether the provision is or is not one which is determinative of jurisdiction.

On pure questions of fact, the deference due by a reviewing court to the finder of fact below remains irrespective of the nature of the proceedings, and it can only be made more compelling by the presence of a privative clause protecting the decision of the lower tribunal. What was under attack before the Motions Judge on that branch of the Adjudicator’s decision dealing with paragraph 242(3.1)(a) of the Code was merely findings of fact, i.e. that there had been no lay-off for economic or administrative reasons, but termination for no apparent reason other than the employee’s perceived sympathy for the union. Such findings were unimpeachable as soon as there was some evidence to support them.

The second issue is the one on which I depart substantially from my colleague’s position. Was the Motions Judge wrong in dismissing, as he did, the appellant’s contention that paragraph 242(3.1)(b) precluded the Adjudicator from dealing with the complaint since the facts, as the Adjudicator himself found them, could form the basis of the “procedure for redress” provided in section 97 [as am. by S.C. 1991, c. 39, s. 2] of the Code?

It is clear that a lack of jurisdiction cannot be cured by the decision maker’s failure to realize that he is acting beyond his powers nor can it be covered by the parties’ silence in regard to it. There is no doubt that the issue had to be dealt with by the Motions Judge. Still, it is important to note that before the Adjudicator there was more than mere silence but a forceful denial on the part of the appellant that it had in any way breached its obligations under Part I of the Code. It is also important to note that the complaint placed before the Adjudicator was for unjust dismissal, that is to say dismissal for no valid reason, the respondent only stating at the inquiry that the sole reason she could think of for her employer’s action was an unfounded suspicion that she was supporting the union. Finally, it is significant that the Adjudicator’s comments throughout his reasons are devoted almost exclusively to refuting the appellant’s contention that the respondent had not been terminated but laid off, and that his reference to the respondent’s perceived sympathy for the union as the only apparent reason for her employer’s unjust behaviour comes at the end of his analysis so as to give a certain positive rationalization to his negative findings.

So the issue had to be dealt with but, put in concrete terms, the question before the Trial Judge was whether the Adjudicator’s final finding that the respondent’s perceived sympathy for the union had been the cause of her termination—a finding, I wish to repeat, that contradicted the employer’s testimony and was based solely on the employee’s stated belief, itself based on two minor, if not totally insignificant, incidents—had the effect of ousting his jurisdiction and requiring him to dismiss immediately, on the authority of paragraph 242(3.1)(b), the complaint brought pursuant to section 240 [as am. by R.S.C., 1985 (1st Supp.), c. 9, s. 15] of the Code. Contrary to my colleague, I think, with respect, that the Trial Judge could not but answer the question in the negative.

On the one hand, as I read paragraph 242(3.1)(b), the application of the interdiction contained therein is dependent on an allegation of unfair labour practice made clearly at the outset or apparent from the initial and open allegations of the parties. The revelation by the employee of a mere suspicion to that effect flatly denied by the employer even if found probable by the Adjudicator at the end of his inquiry would not have the same effect.

My conviction in that respect is essentially grounded in the wording of the provision, in particular that of the opening phrase “[n]o complaint shall be considered by an adjudicator”, in French “[l]’arbitre ne peut procéder à l’instruction de la plainte”. The effect of the provision is to prevent a hearing from taking place. This is a very striking, and to my knowledge, unusual feature in a jurisdictional provision which can hardly be accidental. If the adjudicator is to be prevented from hearing the complaint, the determination regarding his jurisdiction must be made at the outset. It seems to me illogical to infer from the wording of the provision that an adjudicator could lose jurisdiction based on information which arises during the course of a hearing. The Code does not even require the adjudicator to make a finding regarding the employer’s motives. Section 240 of the Code is meant to protect ununionized employees against unjust dismissal, that is to say dismissal for no valid reason. That is all that is required to be alleged and proved in order to find the complaint to be justified. A finding that the only reason given by the employer is not to be believed is complete and final and puts an end to the inquiry.

I am all the more convinced that paragraph 242(3.1)(b) is not triggered by a mere finding, at the end of an inquiry, of a possible attack on the basic freedom of the employee to join the trade union of his choice and to participate in its lawful activities (subsection 8(1)), that, if it was otherwise, wholly unacceptable results would necessarily follow. One can imagine a case, similar to the one at hand, where the Board would believe the employer and conclude that, even if there was no just cause for the termination, the real reason had nothing to do with an unfair labour practice. Or of a case, bound to happen on a regular basis, where the adjudicator’s inquiry is completed long after the time limit to file a complaint under Part I. To say that nothing prevents an employee from filing two complaints is no answer since only a complainant who, at the outset, is in possession of facts sufficient to support his suspicion would be expected to do so. Furthermore, this approach presumes that the Minister will be prepared to appoint an adjudicator in spite of the existence of the Part I complaint and that one of the two complaints can be put in abeyance at will. I cannot believe that Parliament would have such an incongruous system in mind. In any event, the suggestion is of no avail for all those situations where no suspicion exists at the outset but comes to the fore during the inquiry. One could even imagine an employer purporting, at the very end of the inquiry, to make a “confession” in order to put an end to the adjudicator’s involvement and have the case closed.

On the other hand, I am of the opinion that section 94 in Part I of the Code did not offer the respondent another “procedure for redress”.

Here again, it is to the purpose of the provision and its wording that I will refer. Part I of the Code, which was enacted, as stated in its preamble, in furtherance of the “long tradition in Canada of labour legislation and policy designed for the promotion of the common well-being through the encouragement of free collective bargaining and the constructive settlement of disputes”, is obviously labour oriented. Section 94 was designed to sanction the employer’s resort to unfair labour practices including practices interfering with the basic freedom accorded to anyone in the employ of another, and solemnly confirmed in section 8 of the Code, “to join the trade union of his choice and to participate in its lawful activities”. The prohibition established by subparagraph 94(3)(a)(i), the breach of which may give rise to a complaint under section 97, prevents an employer from punishing an employee because that employee:

94. (3)(a) …

(i) is or proposes to become, or seeks to induce any other person to become, a member, officer or representative of a trade union or participates in the promotion, formation or administration of a trade union.

It seems to me that neither the purpose of the provision as one central to Part I nor its wording, strictly construed, would support reading in the words “have mere sympathy for a trade union”, irrespective of the absence of any intention to join that union or participate in its activity. This, it should be recalled, is the exact situation here: the respondent denied having had any intention to join the union or having ever participated in its activities. The appellant was adamant that its officers never had that in contemplation. All the Adjudicator determined, on the sole basis of the respondent’s belief, was that the termination appeared to be motivated by a false perception that the respondent sympathized with “the Union’s efforts at organizing”. To punish someone for having some “platonic” sympathy for anything is wrong in any event. It is a personal affront. The object of the sympathy is purely incidental. I cannot believe that the wrongful punishment of an employee in such circumstances was meant to be sanctioned under the labour oriented Part I of the Code.

The Canada Labour Relations Board was specifically assigned jurisdiction to deal with unfair labour practices because these were obviously thought to be matters appropriate for determination by a specialized tribunal. It is quite understandable that Parliament has taken care to carefully protect the exclusivity of that jurisdiction. However, it is obvious that the expertise of the Board in labour legislation and activities is not required to determine that the firing of an employee for his or her intellectual sympathy is unacceptable.

I find support for my understanding of section 94 in the decision of this Court in Pollard[2] wherein it approved, without reserve, the position taken by the Motions Judge to the effect that that section “concerns complaints concerning unfair labour practices defined by statute, all relating to discriminatory behaviour because of participation in union activities” [[1992] 2 F.C. 697(T.D.), at page 725]. I note also that my reasoning is similar to that expressed by the learned Trial Division Judge in Sagkeeng Alcohol Rehab Centre Inc.[3] when he wrote:

While duplication of proceedings should be avoided, and paragraph 242(3.1)(b) appears to have been enacted for that purpose (perhaps among others), I am certain that Parliament did not intend that aggrieved parties should be forced to run the risk of their unjust dismissal claim being prejudiced by application of this provision. For paragraph 242(3.1)(b) to apply, the alternative procedure for redress must be clearly duplicative.

These are the reasons why I feel I must, with respect, disagree with my colleague. In my judgment, the Motions Judge was correct in finding that the Adjudicator’s jurisdiction to deal with the respondent’s complaint of unjust dismissal was not ousted by either paragraph 242(3.1)(a) or paragraph 242(3.1)(b). As to the former, the Adjudicator’s findings of fact were decisive; as to the latter, the limitation contained therein was not applicable since there was no other available procedure for redress considering the complaint as it was presented and sustained.

There remains the question of costs. My colleague expresses the view that the circumstances of this case were such that he would uphold the decision of the Motions Judge to award costs to the respondent on a solicitor-client basis and would order the same on the appeal, even though, at both levels, the appellant was entitled to the remedy it was seeking. While I do not have to express any opinion as to whether my colleague’s reasoning was sufficient to authorize and justify a most exceptional, if not unprecedented, award of costs against a successful litigant, let alone an award of costs on a solicitor-client basis, his reasoning, which I adopt, is undoubtedly sufficient if, as I suggest, the appeal is dismissed. As to the Adjudicator’s award of costs, I am not prepared to criticize the Motions Judge for having thought that such an incidental decision constituted a proper exercise of discretion under paragraph 242(4)(c).[4]

I would therefore dismiss the appeal with costs to the respondent on a solicitor-client basis.

* * *

The following are the reasons for judgment rendered in English by

Strayer J.A.:

Relief Requested

The appellant asks this Court to set aside a judgment of the Trial Division dated June 17, 1994 which had dismissed the appellant’s application for judicial review seeking to set aside the decision of June 30, 1993 of an Adjudicator acting under section 242 of the Canada Labour Code.[5] The decision of the Adjudicator had found that the respondent Dorothy Kosanovich had been unjustly dismissed by the appellant Byers Transport Limited. The Adjudicator ordered her reinstatement, the payment of all outstanding wages and benefits to which she would have been entitled between the date of her termination and her reinstatement, and all costs incurred by her in seeking her reinstatement. The latter has been understood to include legal costs on a solicitor-client basis.

Facts

The respondent had been employed by the appellant for some time as a Stationery File Clerk when on July 3, 1992 she was handed a letter advising her that her position was being eliminated in order to “reduce costs”. She was given two weeks’ pay in lieu of notification and was effectively excluded from the premises.

At about this time the Teamsters Union, which represented some of the employees of the appellant, was conducting a drive to organize the non-union office staff of which the respondent was a member. Upon receiving the notice of termination the respondent, according to her own evidence before the Adjudicator, told fellow workers that she was being terminated because the employer believed she was connected to the union’s organizing campaign.

On July 7, 1992 the respondent filed a complaint of unjust dismissal under section 240 in Part III of the Canada Labour Code. Her written complaint simply stated that “I feel I was unjustly dismissed”. Before this matter had been proceeded with she filed, on September 21, 1992, a complaint under section 97 in Part I of the Canada Labour Code to the effect that the appellant had committed an unfair labour practice in laying her off or dismissing her for what the appellant believed to be her union activities. In November, 1992 the Teamsters and the appellant agreed upon a settlement of this latter complaint but the respondent rejected that settlement. Instead she sought her own counsel and on January 4, 1993 withdrew her complaint under section 97. Subsequently her complaint under section 240 was processed, with an adjudicator being appointed and a hearing before the Adjudicator being held on June 4, 1993. At that hearing the appellant took the position that the respondent had been laid off as part of a cost-cutting, down-sizing process made necessary by the state of its business. This gave rise to the question of whether the Adjudicator had jurisdiction to deal with the complaint by virtue of subsection 242(3.1) of the Canada Labour Code which provides as follows:

242. …

(3.1) No complaint shall be considered by an adjudicator under subsection (3) in respect of a person where

(a) that person has been laid off because of lack of work or because of the discontinuance of a function; or

(b) a procedure for redress has been provided elsewhere in or under this or any other Act of Parliament.

During that hearing the appellant, which was not represented by counsel, sought to demonstrate through its witnesses that the respondent had been “laid off … because of the discontinuance of a function” within the meaning of paragraph 242(3.1)(a) and thus contended that the complaint should not be considered by the Adjudicator. It is common ground that the employer did not raise any issue at that time based on paragraph 242(3.1)(b) to the effect that there was another procedure for redress under the Code which would preclude the Adjudicator from hearing this complaint. The evidence of the respondent and her witnesses before the Adjudicator was to the effect that she had been terminated and not laid off, that her functions had not been discontinued but simply redistributed, and that she had been singled out for termination because of the employer’s belief that she was assisting the union to organize office staff.

There is a lamentable lack of clarity in the decision of the Adjudicator. The following represents my best understanding of his finding. He seems to have directed his mind to the jurisdictional question involved in paragraph 242(3.1)(a). To this end, he found that there was no “lay-off” as referred to in that paragraph but instead a termination of employment. In his view the method of separation of the respondent from her work did not have the characteristics of a lay-off. Further he found that there was not a discontinuation of her function because there was a redistribution of her work to others—a redistribution which was made in bad faith, namely for perceived union activity. A critical passage from his decision is as follows:

In light of the above I am satisfied that Dorothy Kosanovich was terminated For Cause in the Company’s mind. She was terminated because she sympathized with the Union’s efforts at organizing. As a result, I order the Reinstatement of Dorothy Kosanovich into a position that satisfactorily matches her qualification and at her former salary effective as soon as it can be arranged following the date of this decision.[6]

At this point he also ordered payment of outstanding wages and costs, as noted earlier. The Adjudicator seems to have felt that the determination of the jurisdictional issue under paragraph 242(3.1)(a) was also determinative of the fact of unjust dismissal, the matter which he would have to find in the respondent’s favour in order to grant her these remedies. Thus the ground for the unjust dismissal finding must be taken to be that the respondent was fired for perceived union activity. The Adjudicator did not address a possible paragraph 242(3.1)(b) issue, neither party having raised it.

The appellant sought judicial review in the Trial Division, attacking the decision of the Adjudicator on the grounds that: he erred in applying paragraph 242(3.1)(a) in finding that he had jurisdiction notwithstanding that paragraph; he erred as to jurisdiction in dealing with the complaint of unjust dismissal under section 240 when there was available another procedure for redress for unjust dismissal based on an unfair labour practice, such matter thus being excluded from the Adjudicator’s jurisdiction by virtue of paragraph 242(3.1)(b); and that he had no jurisdiction to award to the respondent her entire costs of her case involving in effect a grant of solicitor-client costs.

With respect to the argument based on paragraph 242(3.1)(a) the Trial Judge applied the standard of review of patent unreasonability and found that the Adjudicator’s decision was not patently unreasonable. He confirmed that the Adjudicator had applied the correct test as to “lay-off” and “discontinuance of a function”, noting in particular that the Adjudicator had found that the respondent’s duties had simply been redistributed and for a purpose other than down-sizing. With respect to the argument based on paragraph 242(3.1)(b), the learned Trial Judge simply said that he disagreed with the argument of the appellant. With respect to the award by the Adjudicator of solicitor-client costs he stated that:

… it was only equitable to require the applicant to pay all costs incurred by Ms. Kosanovich in order to fully compensate her for the unjust dismissal. Under the circumstances, that was a proper and reasonable exercise of the adjudicator’s discretion and I am not prepared to interfere.[7]

Further, he proceeded to grant costs on a solicitor- client basis on the judicial review.

The appellant appeals from this judgment, on the following grounds:

(1) the learned Trial Judge applied the wrong test of patent unreasonability, instead of correctness, for review of the jurisdictional decisions of the Adjudicator;

(2) the learned Trial Judge erred in law in finding that the Adjudicator was not denied jurisdiction by virtue of paragraphs 242(3.1)(a) and (b); and

(3) he should neither have confirmed the Adjudicator’s award of solicitor-client costs nor awarded solicitor-client costs on the judicial review, in both cases the argument being that there is nothing in the way the appellant conducted the litigation such as to justify the award of solicitor-client costs.

Analysis

I shall deal with each of these grounds of appeal.

Standard of Review

In reviewing the Adjudicator’s conclusion that he was not precluded from jurisdiction over the claim by virtue of paragraph 242(3.1)(a), the learned Trial Judge applied the standard of patent unreasonability. He found no such unreasonability to exist in the Adjudicator’s conclusion. The appellant argues that the Adjudicator’s finding was one of jurisdiction for which the standard of review should have been correctness. I agree. In its decision in Pollard[8] this Court had occasion to consider the standard of review in respect of the application of subsection 242(3.1). It held that a determination as to whether an adjudicator is precluded by this subsection from considering the unjust dismissal complaint of a person is a finding as to the existence of jurisdiction and the standard for judicial review of such a determination is that of correctness. This is so notwithstanding the provisions of the privative clause which states as follows:

243. (1) Every order of an adjudicator appointed under subsection 242(1) is final and shall not be questioned or reviewed in any court.

(2) No order shall be made, process entered or proceeding taken in any court, whether by way of injunction, certiorari, prohibition, quo warranto or otherwise, to question, review, prohibit or restrain an adjudicator in any proceedings of the adjudicator under section 242.

The Pollard case was decided only a few months before the Trial Judge’s decision in the present case and there is nothing to indicate that it was brought to his attention. It appears, however, that the matter must now be taken as settled that the standard of review is correctness.

Correctness of Application of Paragraph 242(3.1)(a)

Although the Trial Judge tested this decision of the Adjudicator on the basis of whether it was patently unreasonable, I do not believe that the application of the correctness test would have yielded any different result. While some of the criteria applied by the Adjudicator to determine that there was no “lay-off” were highly questionable, and this was recognized by the Trial Judge, I agree with the Trial Judge that the Adjudicator’s conclusion that there was no “discontinuance of a function” discloses no reviewable error. He appears to have applied the correct legal criteria in reaching this conclusion. The Supreme Court of Canada in Flieger v. New Brunswick[9] had occasion to interpret the phrase “discontinuance of a function” as found in subsection 26(1) of the Civil Service Act of New Brunswick.[10] It concluded that a redistribution of the former work of a person laid off may amount to a discontinuance of his or her function, but only if the redistribution is done in good faith for proper purposes such as down-sizing and economy. In the present case the Adjudicator appears to have found that the respondent’s work had been redistributed but that this had been done in bad faith, namely for the ulterior purpose of getting rid of the respondent because the employer believed her to be supporting the unionization of office workers. There was certainly substantial evidence upon which the Adjudicator could find[11] that this was the motive for the redistribution of the respondent’s work, and indeed I am unable to perceive in the evidence as he describes it, nor in any of the submissions of the respondent at that time or subsequently, any other possible improper motive for the elimination of her job. To that proper finding of fact he applied the correct legal principles and found that there was no discontinuance of a function within the meaning of paragraph 242(3.1)(a). Therefore there was no reviewable error even when the proper standard of review, correctness, is applied.

Correctness of Application of Paragraph 242(3.1)(b)

It will be recalled that this paragraph prohibits an adjudicator from considering a complaint of unjust dismissal where

242. (3.1) …

(b) a procedure for redress has been provided elsewhere in or under this or any other Act of Parliament.

The Adjudicator makes no mention of this paragraph in his decision and it is agreed that the appellant never raised this issue before him. The appellant did raise the issue before the Trial Judge who simply said that he disagreed with the appellant’s contention that paragraph 242(3.1)(b) precluded the Adjudicator from dealing with the complaint because the same facts could (and did) form the basis of a complaint by the respondent of an unfair labour practice under section 97 of the Canada Labour Code.

The respondent objected before us to this matter having been raised on judicial review when it had not been raised by the appellant before the Adjudicator. This objection cannot be sustained. It is clear from cases such as Pollard[12] that paragraph 242(3.1)(b) constitutes a limit on the jurisdiction of the Adjudicator. That limit cannot be ignored simply by being disregarded by the parties or the Adjudicator. The Adjudicator had an obligation in the first instance to consider whether he was barred by paragraph 242(3.1)(b) from considering the complaint. He was not excused from considering that question by the silence or the consent, expressed or implied, of the parties. The fact that he did not consider it does not preclude, or excuse, this Court from determining whether he was acting within his jurisdiction.

I have concluded that he was not, and that the Trial Judge erred in dismissing this objection. It will be helpful to set out some of the relevant provisions of Part I of the Code [ss. 94(3), 97(1) (as am. by S.C. 1991, c. 39, s. 2), 99(1) (as am. idem, s. 3)] dealing with unfair labour practices.

94. …

(3) No employer or person acting on behalf of an employer shall

(a) refuse to employ or to continue to employ or suspend, transfer, lay off or otherwise discriminate against any person with respect to employment, pay or any other term or condition of employment or intimidate, threaten or otherwise discipline any person, because the person

(i) is or proposes to become, or seeks to induce any other person to become, a member, officer or representative of a trade union or participates in the promotion, formation or administration of a trade union ….

…

97. (1) Subject to subsections (2) to (5), any person or organization may make a complaint in writing to the Board that

(a) an employer, a person acting on behalf of an employer, a trade union, a person acting on behalf of a trade union or an employee has contravened or failed to comply with subsection 24(4) or 34(6) or section 37, 50, 69, 94 or 95 ….

…

99. (1) Where, under section 98, the Board determines that a party to a complaint has contravened or failed to comply with subsection 24(4) or 34(6) or section 37, 50, 69, 94, 95 or 96, the Board may, by order, require the party to comply with or cease contravening that subsection or section and may

…

(c) in respect of a failure to comply with paragraph 94(3)(a), (c) or (f), by order, require an employer to

(i) employ, continue to employ or permit to return to the duties of his employment any employee or other person whom the employer or any person acting on behalf of the employer has refused to employ or continue to employ, has suspended, transferred, laid off or otherwise discriminated against, or discharged for a reason that is prohibited, by one of those paragraphs,

(ii) pay to any employee or other person affected by that failure compensation not exceeding such sum as, in the opinion of the Board, is equivalent to the remuneration that would, but for that failure, have been paid by the employer to that employee or other person ….

In the present case the respondent has insisted throughout, from the very moment of her termination and before she left the appellant’s premises, that she was terminated because of perceived union activity although she denied she was really supporting the union. The Adjudicator so found in the passage which has been quoted earlier and this was not an idle obiter dictum. It was an essential finding of fact in order for the Adjudicator to find that there had been bad faith in the redistribution of her functions. This finding enabled him to determine that there had not been a lay-off through discontinuance of a function, the kind of lay-off that would have brought the matter within paragraph 242(3.1)(a) and precluded him from jurisdiction. No other improper motive for her termination was ever suggested as far as I can determine. For some time the respondent in fact pursued her complaint under Part I on the basis that she was laid off solely for union activity.

However, the Adjudicator having come to that conclusion which in my view is correct, failed properly to apply to that finding of fact the relevant law: namely paragraph 242(3.1)(b) which says that he should not consider a complaint where a procedure for redress has been provided elsewhere in the Act.

I fail to understand how it can be said that a procedure for redress of a complaint of dismissal for perceived union activity is not to be found in section 97 of the Canada Labour Code as quoted above. In effect the gravamen of the respondent’s complaint is, paraphrasing subparagraph 94(3)(a)(i), that she was laid off or otherwise prejudicially treated with respect to her employment for having sought to induce other persons to become members of a trade union or for having participated in the promotion of a trade union. I find it inconceivable that, before the procedures for making complaints under section 240 were put in the Canada Labour Code, a person in the position of the respondent would have been told that she had no procedure for redress of her particular complaint under the equivalent of section 94. The matter surely does not turn on whether she had in fact been supporting the union. On this point the evidence is not clear but the Adjudicator himself in a passage which I have already quoted, stated that

She was terminated because she sympathized with the Union’s efforts at organizing.

Whether in fact she was sympathetic to the union, the purpose of the provisions of the Code prohibiting unfair labour practices is surely to prevent employers from discriminating against particular employees simply because they are, or are thought to be, supportive of unionization. Subsection 94(3) prohibits prejudicial treatment of employees “because” of their union activity. This has regard to the anti-union motivation of the employer, whose chilling effect on employees in the exercise of their choice would be the same whether or not the employer might be mistaken in his belief as to a particular employee’s activities.

Further, it will be seen that the procedures for redress are similar in that an employee can file a complaint under both Part I (involving unfair labour practices where the complaint goes to the Canada Labour Relations Board) and Part III (involving “unjust dismissal” where the complaints go to an ad hoc adjudicator). In each case the complaint can ultimately be heard and disposed of by the appropriate tribunal and the remedies may include reinstatement and an order for payment of lost wages during the period of non-employment. In each case the complaint must be filed within 90 days.[13] In both cases there is a procedure for attempted settlements.[14] One difference is that under Part III an adjudicator can by paragraph 242(4)(c) require the employer to

242. (4) …

(c) do any other like thing that it is equitable to require the employer to do in order to remedy or counteract any consequence of the dismissal.

But there is no comparable power for the Board under Part I. In the purported exercise of this power the Adjudicator in this case ordered, in effect, legal costs on a solicitor-client basis be paid by the employer to the employee.

I must conclude that the provisions for the filing and determination of a complaint of dismissal constituting an unfair labour practice under Part I is “a procedure for redress” of a complaint for unjust dismissal where that dismissal is by reason of perceived union sympathy.

I have considered whether the Pollard[15] decision supported the view that the existence of Part I remedies does not oust the jurisdiction of an Adjudicator acting under Part III. It is true that on the facts of that case the Court of Appeal upheld the Trial Judge’s finding that section 94 did not preclude the Adjudicator dealing with a complaint of unjust dismissal. But according to the Trial Judge the complaint there concerned dismissal for alleged misconduct and section 94 provided no remedy for such a dismissal. That is not this case where everyone including the respondent believed redress was available under Part I.

I have also considered carefully the decision of the Trial Division in Sagkeeng Alcohol Rehab Centre Inc.[16] In that case it was argued that because one of the grounds alleged for the complaint of unjust dismissal was discrimination as prohibited by the Canadian Human Rights Act [R.S.C., 1985, c. H-6], there was another form of redress under that Act of Parliament which precluded the Adjudicator from dealing with the complaint by virtue of paragraph 242(3.1)(b). The Trial Judge emphasized that he did not have evidence before him as to the nature of these allegations but he rejected the argument based on paragraph 242(3.1)(b) in part on the basis of his interpretation of the meaning of that paragraph. He held [at page 463] that the other “procedure for redress” referred to therein “cannot be based on a different cause of action or provide a lesser remedy” than the procedure under Part III of the Canada Labour Code. He later stated [at page 465]:

In my view, it must be demonstrated, by the party seeking to rely on paragraph 242(3.1)(b), that under another statutory provision, there exists a procedure for aggrieved parties to pursue a claim for unjust dismissal and obtain a remedy the same as an adjudicator could grant under subsection 242(4) of the Canada Labour Code. The applicant has not demonstrated this to be so.

While duplication of proceedings should be avoided, and paragraph 242(3.1)(b) appears to have been enacted for that purpose (perhaps among others), I am certain that Parliament did not intend that aggrieved parties should be forced to run the risk of their unjust dismissal claim being prejudiced by application of this provision. For paragraph 242(3.1)(b) to apply, the alternative procedure for redress must be clearly duplicative. [Emphasis added.]

While not questioning the result in that case, given the evidence before the Trial Judge, I have some reservations as to his analysis of the meaning of “a procedure for redress” of a “complaint” as referred to in the statute. I believe that the complaint (i.e. the factual situation complained of) must be essentially the same in the other “procedure for redress”. But I doubt that the remedies have to be as good or better under the other provision in order to oust the jurisdiction of the adjudicator under paragraph 242(3.1)(b). That paragraph does not require that the same redress be available under another provision of the Canada Labour Code or some other federal Act. What it requires is that in respect of the same complaint there be another procedure for redress. The point is even clearer in the French version which simply requires that there be “un autre recours”. I do not believe that for there to be a “procedure for redress … elsewhere” there must be a procedure which will yield exactly the same remedies, although no doubt that procedure must be capable of producing some real redress which could be of personal benefit to the same complainant.

In this respect it is useful to look more broadly at the structure of the Canada Labour Code and the apparent intention of Parliament. There have been prohibitions against unfair labour practices in the Code or its predecessors[17] since 1948, and a procedure for employees to lay complaints before the Canada Labour Relations Board against employers with respect to such practices since at least 1972.[18] The Board was specifically assigned jurisdiction to deal with unfair labour practices whether practised by employers or unions. These were obviously thought to be matters appropriate for determination by the specialized Board. It was not until 1978[19] that the procedure was inserted in Part III of the Act providing for those non-unionized employees who had no access to grievances or arbitration under collective agreements to file a complaint of unjust dismissal and to have it heard by an ad hoc adjudicator. In Pollard the Federal Court of Appeal[20] discussed the relative status and functions of an adjudicator as compared to the Board. The much broader powers given to the Board were compared to those of the adjudicator. The Court went on to say [at pages 669-670]:

These differences are a strong indication, in my view, that Parliament did not intend the adjudicator to have a final say as to who could or could not make a complaint.

Furthermore, the area of expertise of the adjudicator is a rather limited one. He is “any person that the Minister considers appropriate as an adjudicator” (subsection 242(1)), he is appointed on an ad hoc basis and he is to consider complaints made by a limited class of employees (subsections 240(1) and 242(3.1)) with respect to one single issue, namely, unjust dismissal (paragraph 242(3)(a)). His expertise is far less extensive than that of the members of the Canada Labour Relations Board and that of an arbitrator appointed pursuant to Part I of the Code. The Supreme Court, in Bradco, at page 337, and in Mossop, at page 585, was not very much impressed, albeit at a different stage of the review process, with the status of ad hoc bodies which have as restricted powers and expertise as the adjudicator has under the Code. To paraphrase the words of counsel approved by Beetz J. in Bibeault, at pages 1094-1095, it can be seen at the outset that the legislator did not see fit to give the adjudicator a general, exclusive jurisdiction over implementation of and compliance with all the provisions of the Code. He chose instead the approach of conferring a general power to the Canada Labour Relations Board and several specific powers over specific and defined matters to other decision-makers and even then he did not give the same powers to all.

This analysis supports the view that where Parliament has established specialist tribunals, whether under the Canada Labour Code or elsewhere, to deal with certain aspects of employer-employee relationships, it should not be taken to have conferred concurrent jurisdiction on ad hoc adjudicators to deal with the same matter. In my view the procedure in Part III for the filing of complaints by non-unionized employees for unjust dismissal, for hearing by an adjudicator, should be seen as a residual procedure intended to provide some redress where such redress was not otherwise available. It seems to me that that is the clear meaning of paragraph 242(3.1)(b).

Nor need this approach create serious problems for a dismissed employee who is perhaps not sure which procedure for redress to invoke. As far as I can ascertain, one can file complaints under both Part I and Part III of the Code without incurring any expense. The critical deadline in each case is 90 days after the complainant is aware of the cause for complaint. The Part III remedy being residual, it would be prudent for the complainant to prosecute first the Part I complaint. Only if she is unable to establish an unfair labour practice as the cause for her dismissal should she then pursue further the Part III complaint.[21] It will be noted that in the present case the respondent did in fact file complaints under both Parts, but she failed to pursue the Part I complaint to its conclusion by seeking a hearing before the Board. It was she who terminated her Part I redress procedure.

It should also be noted that section 246 provides as follows:

246. (1) No civil remedy of an employee against his employer is suspended or affected by sections 240 to 245.

(2) Section 189 applies for the purposes of this Division.

Thus the employee retains the ultimate right to sue her employer if subsection 242(3.1) does not allow a proceeding before an adjudicator.

Therefore it follows that the learned Trial Judge should have quashed the decision of the Adjudicator on the basis that the Adjudicator had no jurisdiction, being precluded from considering the complaint by reason of paragraph 242(3.1)(b) of the Canada Labour Code.

Costs

As the decision of the Adjudicator must be set aside, it is unnecessary to consider whether his award of costs was proper. We must, however, consider whether the award by the Trial Judge of costs to the respondent on a solicitor-client basis can be upheld and whether costs should be awarded on this appeal.

It should first be observed that the Trial Judge [at page 115] must have found there to be “special reasons” for ordering costs in an application for judicial review, as Rule 1618 [Federal Court Rules, C.R.C., c. 663 (as am. by SOR/92-43, s. 19)] so requires. He justified his award on the basis of “the conduct of the applicant in pursuing this judicial review application” and apparently applied that justification also to granting costs to the respondent on a solicitor-client basis.

Even though the respondent has not succeeded here, I would agree with the Trial Judge that costs on the judicial review and this appeal should be awarded against the appellant employer on a solicitor-client basis. The conduct of the appellant for which I believe this award is warranted is the reversal of its position since the beginning of the adjudication. This has greatly contributed to the costs of the respondent and the necessity for the judicial review. Before the Adjudicator the appellant employer adamantly denied that perceived union activity was the reason for the respondent’s termination. Having lost before the Adjudicator and before the Trial Judge the appellant now takes the position that perceived union activity was the cause for the dismissal. I quote from paragraph 20 of the appellant’s memorandum of fact and law filed in this Court.

20. A review of the material before the Court must lead to the conclusion that Mrs. Kosanovich was dismissed for anti-union reasons:

(a) she said so three times in her Part I complaint (A.B. p. 32);

(b) the Teamsters Union took up the matter and a hearing was scheduled by the Canada Labour Relations Board after an investigation;

(c) a settlement was reached between the Union and the employer, but rejected by Mrs. Kosanovich (this is clearly a “procedure for redress” whether or not the result obtained is agreed to or not by the complainant. Subsection 3.1(b) does not say “… where a procedure for redress satisfactory to the complainant is provided elsewhere.”

(d) the adjudicator found that the reason Mrs. Kosanovich was terminated was because she sympathized with the Union’s efforts at organizing (A.B. p. 24)—this is the “ratio” of his decision.

If the employer had taken this position from the outset the matter would probably have been disposed of satisfactorily pursuant to the Part I complaint. At the very least the appellant should have raised the matter before the Adjudicator and insisted that the complaint could only be dealt with under Part I. Instead the employer kept this alternative position in reserve and having failed before the Adjudicator, now reverses its position and insists that the matter is one for consideration by the Board under Part I only, in the process forcing the respondent to defend the Adjudicator’s award under Part III before both Divisions of the Federal Court.

While there is no basis upon which this Court can order costs before the Adjudicator, costs of the respondent before the Trial Division and before the Federal Court of Appeal should be paid by the appellant on a solicitor-client basis.

Disposition

The appeal should therefore be allowed and the decision of the Adjudicator C. S. Mellors of June 30, 1993 set aside, with costs before the Trial Division and the Court of Appeal to be paid by the appellant to the respondent Dorothy Kosanovich.

Linden J.A.: I agree.

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