T-9206-82
Public Service Alliance of Canada (Plaintiff)
v.
The Queen in right of Canada as represented by
Treasury Board and Attorney General of Canada
(Defendants)
Trial Division, Reed J.-Ottawa, February 20 and
March 21, 1984.
Public service - Public Sector Compensation Restraint Act
- Whether Act denying freedom of association guaranteed by
Charter - Whether rights to bargain and strike protected by
freedom of association - Whether Charter s. 7 right to liberty
including liberty to bargain terms and conditions of employ
ment; if so, whether such right denied by Act and whether
denial contrary to principles of fundamental justice
Assuming Charter right or freedom infringed, whether reason
able limit demonstrably justified in free and democratic socie
ty - Whether Act depriving plaintiff of enjoyment of property
without due process, contrary to Bill of Rights s. 1(a)
Whether Act denying equality before law and protection of
law, contrary to Bill of Rights s. 1(b) - Canadian Charter of
Rights and Freedoms, being Part I of the Constitution Act,
1982, Schedule B, Canada Act 1982, 1982, c. 11 (U.K.), ss. 1,
2(d), 7, 8, 9, 10, 12, 33 - Public Sector Compensa
tion Restraint Act, S.C. 1980-81-82-83, c. 122, ss. 2(1),
4(1)(a),(b), 5, 6, 7, 8(1), 9(1),(2), 10, 16 - Public Service Staff
Relations Act, R.S.C. 1970, c. P-35, ss. 49(2)(b), 63, 77, 101
- Canadian Bill of Rights, R.S.C. 1970, Appendix III, s.
1(a),(b) - Constitution Act, 1867, 30 & 31 Vict., c. 3 (U.K.)
[R.S.C. 1970, Appendix II, No. 5] (as am. by Canada Act
1982, 1982, c. 11 (U.K.), Schedule to the Constitution Act,
1982, Item 1), ss. 91, 92.
Anti-inflation - Public Sector Compensation Restraint Act
- Whether Act denying freedom of association guaranteed by
Charter - Whether rights to bargain and strike protected by
freedom of association - Whether Charter s. 7 right to liberty
including liberty to bargain terms and conditions of employ
ment; if so, whether such right denied by Act and whether
denial contrary to principles of fundamental justice
Assuming Charter right of freedom infringed, whether such
infringement reasonable limit demonstrably justified in free
and democratic society - Whether Act depriving plaintiff of
enjoyment of property without due process of law, contrary to
Bill of Rights s. 1(a) - Whether Act denying equality before
law and protection of law, contrary to Bill of Rights s. 1(b) -
Canadian Charter of Rights and Freedoms, being Part I of the
Constitution Act, 1982, Schedule B, Canada Act 1982, 1982, c.
11 (U.K.), ss. 1, 2(d), 7, 8, 9, 10, 12. 33 - Public Sector
Compensation Restraint Act, S.C. 1980-81-82-83, c. 122, ss.
2(1), 4(1)(a),(b), 5, 6, 7, 8(1), 9(1),(2), 10, 16 - Public Service
Staff Relations Act, R.S.C. 1970, c. P-35, ss. 49(2)(b), 63, 77,
101 — Canadian Bill of Rights, R.S.C. 1970, Appendix III, s.
1(a),(b) — Constitution Act, 1867, 30 & 31 Vict., c. 3 (U.K.)
[R.S.C. 1970, Appendix II, No. 51 (as am. by Canada Act
1982, 1982, c. 11 (U.K.), Schedule to the Constitution Act,
1982, Item 1), ss. 91, 92.
Labour relations — Constitutional law — Charter of Rights
— Freedom of association — Not extending to freedom to
bargain collectively and to strike — Ontario Divisional Court
judgment in Broadway Manor Nursing Home case not fol
lowed — "Liberty" in Charter s. 7 concerning physical liberty
of person, not including freedom of contract — That future
wage hikes rolled back by legislation not deprivation of prop
erty without due process contrary to Bill of Rights — Right to
future increases under collective agreement not vested property
right — Canadian Charter of Rights and Freedoms, being Part
I of the Constitution Act, 1982, Schedule B, Canada Act 1982,
1982, c. 11 (U.K.), ss. 2(d), 7 — Canadian Bill of Rights,
R.S.C. 1970, Appendix III, s. 1(a),(b).
Constitutional law — Charter of Rights — Freedom of
association — Whether Public Sector Compensation Restraint
Act infringing freedom — Whether right to bargain and strike
protected by Charter freedom of association — Whether inter
national covenants acceded to by Canada protecting right to
strike and, if so, whether such right necessarily incorporated in
Charter — Canadian Charter of Rights and Freedoms, being
Part I of the Constitution Act, 1982, Schedule B, Canada Act
1982, 1982, c. 11 (U.K.), ss. 2(d), 7 — Public Sector Compen
sation Restraint Act, S.C. 1980-81-82-83, c. 122 — Public
Service Staff Relations Act, R.S.C. 1970, c. P-35.
Constitutional law — Charter of Rights — Limitation
clause — Assuming plaintiffs Charter freedom of association
denied by Public Sector Compensation Restraint Act, whether
abridgment reasonable limit demonstrably justified in free and
democratic society — Determination of reasonableness neces
sarily involving assessment of economic benefit to society,
against cost of infringement to individuals — Benefit to society
as whole not sufficiently substantial to justify abridgement of
constitutionally guaranteed individual rights — Words
"demonstrably justified" requiring more than reasonable
rationale — Canadian Charter of Rights and Freedoms, being
Part I of the Constitution Act, 1981, Schedule B, Canada Act
1982, 1982, c. 11 (U.K.), ss. 1, 2 — Public Sector Compensa
tion Restraint Act, S.C. 1980-81-82-83, c. 122.
Constitutional law — Charter of Rights — Right to liberty
— Whether right to "liberty" in s. 7 including freedom to enter
into contracts relating to terms of employment — Freedom to
contract, being economic right, not included in concept of
"liberty" — S. 7 concerned with physical liberty of person,
right to dispose of own body, of own person — "Principles of
fundamental justice" in s. 7 used in procedural, not substan
tive sense — Canadian Charter of Rights and Freedoms, being
Part I of the Constitution Act, 1982, Schedule B, Canada Act
1982, 1982, c. 11 (U.K.), ss. 1, 2 — Public Sector Compensa
tion Restraint Act, S.C. 1980-81-82-83, c. 122.
Canadian Bill of Rights — Enjoyment of property —
Whether Public Sector Compensation Restraint Act depriving
plaintiff of enjoyment of property without due process of law
— Right to wage increase under collective agreement not
vested and enforceable property right — "Due process of law"
in s. 1(a) used in procedural, not substantive sense — Due
process clause not applicable to protect property rights affect
ed by federal expropriation and nationalization laws —
Canadian Bill of Rights, R.S.C. 1970, Appendix III, s. 1(a) —
Public Sector Compensation Restraint Act, S.C. 1980-81-82-
83, c. 122.
Canadian Bill of Rights — Equality before law — Whether
infringed by Public Sector Compensation Restraint Act as civil
servants allegedly singled out in capricious and arbitrary
manner — Employer-employee relationship between govern
ment and union sufficient for Act to meet test of "valid federal
objective" as used in case law — Canadian Bill of Rights,
R.S.C. 1970, Appendix III, s. 1(b) — Public Sector Compen
sation Restraint Act, S.C. 1980-81-82-83, c. 122 — Constitu
tion Act, 1867, 30 & 31 Via., c. 3 (U.K.) [R.S.C. 1970,
Appendix II, No. SJ (as am. by Canada Act 1982, 1982, c. 11
(U.K.), Schedule to the Constitution Act, 1982, Item 1), ss.
91, 92.
Evidence — Explanations of Minister sponsoring Bill before
Joint Parliamentary Committee — Weight to be given to such
comments.
In 1982, the Parliament of Canada adopted the Public
Sector Compensation Restraint Act by which collective agree
ments in the public sector were extended for a period of two
years. The Act rolled back wage increases in the agreements to
6% for the first year and provided for an increase of 5% for the
second year. Since the Public Service Staff Relations Act
prohibits strikes when a collective agreement is in force, the
right to strike was therefore abrogated for the period of exten
sion. The Public Sector Compensation Restraint Act also per
mitted changes to collective agreements, but only if agreed to
by the Treasury Board or the Governor in Council.
The plaintiff seeks a declaration that the Act is invalid as
inconsistent with the Charter of Rights or that it is inoperative
as inconsistent with the Bill of Rights. More precisely, the
contention is that the Act deprives the plaintiff and its mem
bers of (a) the fundamental freedom of association guaranteed
by section 2 of the Charter; (b) the liberty to bargain their
terms and conditions of employment, contrary to the principles
of fundamental justice, in violation of section 7 of the Charter;
(c) the enjoyment of property without due process of law,
contrary to paragraph 1 (a) of the Bill of Rights; (d) equality
before the law and of protection of the law, contrary to
paragraph 1(b) of the Bill of Rights.
Held, the action should be dismissed.
Even though the Act provides for the possibility of making
changes to collective agreements, the right to collective bar
gaining cannot be said to be preserved since there is no right to
collectively withdraw services. As for the argument that the
right to collective bargaining is not destroyed, but merely
suspended for a certain period, the fact is that a suspension is a
denial for a certain period. While the right to collective bar
gaining, if constitutionally entrenched, would not carry with it
a duty on the employer to bargain in good faith or the right to
have operating all the mechanisms of arbitration and concilia
tion of the Public Service Staff Relations Act, it would, in spite
of a Minister's comments to the contrary before a Joint Parlia
mentary Committee, carry with it the right to strike.
The plaintiff's arguments to the effect that the freedom to
bargain is encompassed by the concept of freedom of associa
tion are heavily based on the Broadway Manor case. In that
case, the judge relied on the Minister's interpretation of that
concept. Ministers' comments before Parliamentary Commit
tees should not be given too much weight: they have an
advocacy character and are meant to convince the members of
those committees. Secondly, the judge found that the history of
freedom of association at common law encompassed a right to
bargain collectively and strike, but the cases relied on only deal
with the history of the right to strike. Thirdly, it was found that
international covenants to which Canada has acceded protect
this right. Most of the conventions do not expressly mention the
right to strike, but even if some do, that does not mean that the
Charter of Rights intended to incorporate all rights contained
in those conventions. The fourth argument is that if the pur
poses for which an association is organized are not protected by
the right to freedom of association, there is a danger that the
freedom itself can be undercut. However, there is nothing in
Anglo-Canadian or American case law or in the international
law context which would lead to the conclusion that the use of
the term "freedom of association" is meant usually to include a
freedom to bargain. Furthermore, it would not have been
intended in a section of the Charter dealing with fundamental
rights to include a right that is essentially economic in nature
without some more express wording. "Freedom of association"
guarantees unions, inter alia, the right to join together, to
solicit members and to advocate their views, but not the right to
strike.
In view of this conclusion, it would not be necessary to
examine whether the Act is a reasonable limit demonstrably
justified in a free and democratic society within the meaning of
section 1 of the Charter. But since this case was expected to be
appealed, the evidence and arguments on this point were
reviewed. While the determination of whether the Act is a
"reasonable limit" is not an economic question, economic evi
dence may well be a starting point in a case such as this. There
must be an assessment of the economic benefit to society
against the cost of the infringement to individuals. At the time,
it was a reasonable economic judgment to have concluded that
inflation was a problem which needed government intervention.
But the evidence is clear that monetary policy and not wage-
price controls is the primary tool by which to combat inflation.
The evidence clearly indicates that the decline in inflation was
due to the world recession and not the government's 6 and 5
program. It seems reasonable to conclude that it played little
part in the reduction of inflation. The Act was designed to have
a demonstrative effect, not to serve as a direct economic lever
to combat inflation. At most, it seems to have been conceived to
create some psychological effects, some dampening of expecta
tions. Such a measure would not meet the test of section 1 of
the Charter. If freedom to bargain collectively was a constitu
tionally guaranteed right, the Restraint Act would not be a
"reasonable limit ... demonstrably justified". The test is more
than the requirement that the legislation have a reasonable
rationale. If that were the case, there would be no scope left for
section 33. While the test may vary from case to case, it must
be very substantial, and in this case the benefit accruing to
society is not sufficiently substantial to justify an abridgment of
constitutionally guaranteed individual rights.
In arguing that the Act was contrary to the principles of
fundamental justice because of its discriminatory nature, coun
sel raised the issue of whether section 7 of the Charter extends
to substantive due process. Upon examination of case law and
the leading Canadian texts on the question, the better view
seems to be that section 7 relates only to procedural fairness. In
any event, the term "liberty" in section 7 does not encompass
freedom of contract. Section 7 is concerned with physical
liberty of the person, the right to dispose of one's own body, of
one's person.
The argument that the persons whose prospective wage
increases under collective agreements were rolled back by the
Act were deprived of property without due process of law, in
violation of paragraph 1(a) of the Bill of Rights, is without
foundation. A right to a wage increase at a future date under
an existing collective agreement is not a property right vested
and enforceable. In any event, "without due process of law" has
not been interpreted as including substantive due process.
It is also argued that the right of the individual to equality
before the law recognized in paragraph 1(b) of the Bill of
Rights has been violated because the Act singles out federal
civil servants for restrictive treatment without rational grounds.
The issue is whether the Act meets the test of a "valid federal
objective". In this case, the employer-employee relationship
between the government and those challenging the Act is such
as to constitute a sufficient justification to meet that test as
defined in case law.
CASES JUDICIALLY CONSIDERED
APPLIED:
Minister of Home Affairs v. Fisher, [1980] A.C. 319
(P.C.); Attorney-General of Fiji v. Director of Public
Prosecutions, [1983] 2 W.L.R. 275 (P.C.); The Queen v.
Bowen, judgment dated November 10, 1983, Ontario
High Court, not yet reported; Re Alberta Union of
Provincial Employees et al. and the Crown in right of
Alberta (1980), 120 D.L.R. (3d) 590 (Alta. Q.B.); Col-
lymore v. Attorney-General, [1970] A.C. 538 (P.C.);
Hanover Tp. Federation of Teachers, Local 1954 (AFL-
CIO) v. Hanover Community School Corp. C.A.Ind., 457
F.2d 456 (1972) (7th Cir.); Smith v. Arkansas State
Highway Employees, 441 U.S. 463 (1979) (8th Cir.);
Dolphin Delivery Ltd. v. Retail, Wholesale and Dept.
Store Union, Loc. 580, [1984] 3 W.W.R. 481 (B.C.C.A.);
R. v. Hayden, [1983] 6 W.W.R. 655 (Man. C.A.); Re
Mason; Mason v. R. in Right of Can. (1983), 35 C.R.
(3d) 393 (Ont. S.C.); The Queen v. Drybones, [1970]
S.C.R. 282; Attorney-General of Canada v. Lovell,
[1974] S.C.R. 1349; R. v. Burnshine, [1975] 1 S.C.R.
693; Prata v. Minister of Manpower and Immigration,
[1976] 1 S.C.R. 376; MacKay v. The Queen, [1980] 2
S.C.R. 370.
NOT FOLLOWED:
Re Service Employees' International Union, Local 204
and Broadway Manor Nursing Home, et al. and two
other applications (1983), 44 O.R. (2d) 392; confirmed on
appeal: 1086-83, judgment dated October 22, 1984,
Ontario Court of Appeal, not yet reported.
DISTINGUISHED:
Crofter Hand Woven Haris Tweed Co., Ltd. v. Veitch,
[1942] 1 All E.R. 142 (H.L.); C.P.R. v. Zambri, [1962]
S.C.R. 609; 34 D.L.R. (2d) 654.
CONSIDERED:
Schmidt and DahlstrOm v. Sweden (1976), 1 E.H.R.R.
632 (Eur. Court H.R.); Reference re Section 94(2) of the
Motor Vehicle Act (1983), 147 D.L.R. (3d) 539
(B.C.C.A.); R. v. Stevens (1983), 145 D.L.R. (3d) 563
(Ont. C.A.); Duke v. The Queen, [1972] S.C.R. 917.
REFERRED TO:
Allman et al. v. Commissioner of the Northwest Territo
ries (1983), 44 A.R. 170 (N.W.T.S.C.); Edwards v.
Attorney-General of Canada, [1930] A.C. 124 (P.C.);
British Coal Corporation v. The King, [1935] A.C. 500
(P.C.); Attorney-General for Ontario and Others v.
Attorney-General for Canada and Others and Attorney-
General for Quebec, [1947] A.C. 127 (P.C.); Attorney-
General of Quebec v. Blaikie et al., [1979] 2 S.C.R.
1016; Law Society of Upper Canada v. Skapinker,
[1984] 1 S.C.R. 357, reversing (1983), 40 O.R. (2d) 481
(C.A.); Curr v. The Queen, [ 1972] S.C.R. 889.
COUNSEL:
Maurice W. Wright, Q.C. and Peter W. Hogg,
Q.C. for plaintiff.
Eric A. Bowie, Q.C. and Robert Cousineau
for defendants.
SOLICITORS:
Soloway, Wright, Houston, Greenberg,
O'Grady, Morin, Ottawa, for plaintiff.
Deputy Attorney-General of Canada for
defendants.
The following are the reasons for judgment
rendered in English by
REED J.: This is a claim for a declaration that
the Public Sector Compensation Restraint Act
(S.C. 1980-81-82-83, c. 122) is invalid as incon
sistent with the Canadian Charter of Rights and
Freedoms (Part I of the Constitution Act, 1982,
Schedule B, Canada Act 1982, c. 11 (U.K.)), or is
inoperative as inconsistent with the Canadian Bill
of Rights (S.C. 1960, c. 44 [R.S.C. 1970, Appen
dix III]).
More precisely the plaintiff claims that the
Public Sector Compensation Restraint Act
deprives the plaintiff and the federal public ser
vants whom it represents of
(a) the fundammental freedom of association
contrary to section 2 of the Canadian Charter of
Rights and Freedoms;
(b) the liberty to bargain their terms and condi
tions of employment contrary to the principles
of fundamental justice as provided in section 7
of the Canadian Charter of Rights and
Freedoms;
(c) the enjoyment of property without due pro
cess of the law contrary to paragraph 1(a) of the
Canadian Bill of Rights; and
(d) equality before the law and of protection of
the law contrary to paragraph 1(b) of the
Canadian Bill of Rights.
The plaintiff is an "employee organization"
within the meaning of the Public Service Staff
Relations Act, (R.S.C. 1970, c. P-35). It has
approximately 180,000 members of whom approxi
mately 168,000 are federal public servants.
Public Service Compensation Restraint Act
For the purposes of this action evidence was
given of the effect the Public Sector Compensation
Restraint Act had on five groups of employees for
whom the plaintiff is certified as bargaining agent:
the clerical and regulatory group (CR) in the
administrative support category; the education
group (ED) in the scientific and professional cate
gory; the education support group (EU) in the
technical category; the administrative services
group (AS) in the administrative and foreign ser
vices category; the program administration group
(PM) of the administrative and foreign service
category.
The first three groups all had collective agree
ments in existence at the date the Public Sector
Compensation Restraint Act became effective.
That Act was assented to August 4, 1982 but its
effective date was June 29, 1982.
The collective agreement applicable to the CR
group was for a two-year period which would have
expired January 11, 1984. It provided for, among
other things, an increase in wages of 12 to 12 1 / 4 %
effective December 12, 1982. The collective agree
ments applicable to the ED and EU groups were
both for two-year periods to expire August 31,
1983. They provided for, among other things,
increases in wages of a similar order effective
September 1, 1982.
The Public Sector Compensation Restraint Act
extended the life of collective agreements in force
on June 29, 1982. The extension was for a two-
year period from the date of the next wage
increase contemplated in the respective agree
ments (that is from December 12, 1982 for the CR
group and from September 1, 1982 for the ED and
EU groups). Also, the Act "rolled back" the wage
increases in the agreement to 6% for the first year
and provided for an increase of 5% for the second
year to which the agreement had been extended.
4. (1) Every compensation plan that is in effect on June 29,
1982 for employees to whom this Part applies, including every
compensation plan extended under section 5, shall be extended
for the period of twenty-four months
(a) from the day on which the first increase in wage rates on
or after June 29, 1982 would, but for section 8, occur under
the compensation plan; or
(b) where no increase in wage rates is to occur under the
compensation plan on or after June 29, 1982, from the day
immediately following the day on which the compensation
plan would, but for this section, expire.
8. (1) Notwithstanding any other Act of Parliament, any
provision of a compensation plan for employees to whom this
Part applies that provides for an increase in wage rates for the
employees on or after June 29, 1982 shall be of no effect.
9. (1) Notwithstanding any other Act of Parliament, every
compensation plan for employees to whom this Part applies
shall be deemed to include a provision to the effect that
(a) wage rates in effect under the plan
(i) on the day the plan would, but for section 4, expire, or
(ii) on the day immediately prior to the day on which the
first increase in wage rates on or after June 29, 1982
would, but for section 8, occur under the plan,
as the case may be shall be increased for the twelve month
period immediately following that day
(iii) in the case of a collective agreement or an arbitral
award, by six per cent, and
(iv) in any other case, by not more than six percent;
and
(b) wage rates in effect under paragraph (a) shall be
increased for the twelve month period immediately following
the period referred to in that paragraph
(i) in the case of a collective agreement or an arbitral
award, by five percent, and
(ii) in any other case, by not more than five per cent.
(2) For the purposes of subparagraph 1(a)(ii), the first
increase in wage rates on or after June 29, 1982 that would, but
for section 8, occur under a compensation plan that is deemed
under subsection 4(2) to be in effect on that date shall be
deemed to be the first increase in wage rates that occurs after
any increase in wage rates that occurs on the day the plan
comes into effect.
Neither the AS nor the PM groups were covered
by collective agreements on June 29, 1982. The
agreements previously applicable to them had
expired June 20, 1982. On June 18, 1982 the
plaintiff on behalf of the AS group had requested
the establishment of an arbitration board pursuant
to section 63 of the Public Service Staff Relations
Act to resolve the outstanding differences respect
ing a new collective agreement. On July 8, 1982 an
arbitration board was established but no hearings
on the merits were held before August 4, 1982, the
date of the passage of the Restraint Act.
The plaintiff, on behalf of the PM group, had
been involved in bargaining with the employer
during the summer of 1982. Notice to bargain,
pursuant to paragraph 49(2)(b) of the Public Ser
vice Staff Relations Act had been given April 21,
1982. On September 16, 1982 the plaintiff, on
behalf of the PM group, asked that a conciliation
board be established pursuant to section 77 of the
Public Service Staff Relations Act.
For groups not covered by collective agreements
on June 29, 1982, the Restraint Act extended the
life of the expired agreement for a year from its
expiry date (from June 20, 1982 for the AS and
PM groups) allowed for a wage increase of no
more than 9% for that year.
5. (1) Subject to subsection (2), where a compensation plan
for employees to whom this Part applies would, but for this
subsection, have expired before June 29, 1982 and no new
compensation plan was established before that date, or on or
after that date in accordance with subsection 4(2), the compen
sation plan shall be extended
(a) where the compensation plan would have expired on or
after June 29, 1981, for the twelve month period immediately
following the day the plan would have expired; or
(b) where the compensation plan would have expired before
June 29, 1981, until June 29, 1982.
(2) A compensation plan for management employees that
would, but for this subsection, have expired before June 29,
1982 shall be extended until June 30, 1982.
10. A compensation plan that is extended under subsection
5(1) shall be deemed to include a provision to the effect that
wage rates in effect under the plan on the day the plan would,
but for subsection 5(1), have expired shall be increased
(a) in the case of the compensation plan referred to in
paragraph 5(1)(a), for the twelve month period referred to in
that paragraph by not more than nine per cent; and
(b) in the case of a compensation plan referred to in para
graph 5(1)(b),
(i) for the period immediately preceding June 29, 1981, by
such amounts as the Treasury Board may authorize, and
(ii) for the period commencing on June 30, 1981 and
ending on June 29, 1982, by not more than nine per cent.
The Act then extended these agreements for a
further two years (i.e. from June 20, 1983 for the
AS and PM groups) with a wage increase of 6%
for the first of these two years and a wage increase
of 5% for the second.
The extension for the further two years is pro
vided for by subsection 4(1) (supra). It applies to
compensation plans in effect on June 29, 1982
including compensation plans extended under
section 5.
Needless to say, the settling of disputes, arising
in the negotiation of new collective agreements, by
means of a binding decision of an arbitration
board, or by means of non-binding recommenda
tions through a conciliation process, was no longer
possible. Thus the arbitration board which had
been established to deal with the outstanding
issues concerning the AS group rendered a deci
sion on August 31, 1982 stating that it was no
longer authorized to determine the matters in dis
pute between the parties. The conciliation board
asked to consider the outstanding issues respecting
the PM group rendered a similar decision on Octo-
ber 6, 1982.
Indeed the role of these bodies with respect to
collective bargaining is implicitly overridden by
section 6 of the Restraint Act:
6. (1) Notwithstanding any other Act of Parliament except
the Canadian Human Rights Act but subject to this section and
section 7, the terms and conditions of
(a) every compensation plan that is extended under section 4
or 5, and
(b) every collective agreement or arbitral award that includes
such a compensation plan,
shall, subject to this Part, continue in force without change for
the period for which the compensation plan is extended.
(2) The Treasury Board may authorize any change to any
terms and conditions, including any increase in wage rates of
not more than nine per cent,
(a) of a compensation plan that would, but for section 5,
have expired before June 29, 1982; or
(b) of a collective agreement or arbitral award that includes
such a compensation plan.
(3) The Treasury Board may change any terms and condi
tions, including any increase in wage rates of not more than
nine per cent,
(a) of a compensation plan that would, but for section 5,
have expired before June 29, 1982; or
(b) of a collective agreement or arbitral award that includes
such a compensation plan,
where the parties to the plan fail to agree to change those terms
and conditions.
(4) Nothing in this section affects any work sharing agree
ment that has been approved for the purposes of section 37 of
the Unemployment Insurance Act, 1971.
(5) Employees or groups of employees whose salary range as
of June 29, 1982 has a maximum that equals or exceeds
forty-nine thousand five hundred dollars shall not, for the
twenty-four month period during which their compensation
plan is extended under section 4, be entitled to the merit
increases, incremental increases or performance awards that
would, but for this subsection, form part of their compensation
plan.
During the existence of the restraint period
Treasury Board was given the authority to make
changes to collective agreements or compensation
plans. Also, it should be noted that section 101 of
the Public Service Staff Relations Act prohibits
strikes during the continuance of a collective
agreement. Section 6 of the Restraint Act contin
ues not only the terms and conditions of the com
pensation plan part of a collective agreement, but
also "the terms and conditions of ...(b) every
collective agreement ... that includes such a com
pensation plan...." Thus, by extending the life of
collective agreements for two years, and in some
cases more, the Act removed the right to strike
during that period.
Thus, the plaintiff argued the Restraint Act
destroyed collective bargaining.
Evidence was given showing instances in which
collective agreements covering employees never
before covered by any collective agreement were
negotiated, several instances in which changes to
the non-compensation terms and conditions of col
lective agreements had occurred, and instances in
which new compensation plans were negotiated
and approved by the Governor in Council pursuant
to section 16 of the Restraint Act.
In the first category mentioned above, the
negotiation of completely new collective agree
ments were negotiated with small groups of
employees: the janitorial and maintenance
employees of the National Arts Centre and some
non-public funds employees working in certain
military messes. The first of these groups had
indeed gone on strike for three days in the course
of negotiating the collective agreement.
The second category of negotiations mentioned
above included a two-year agreement negotiated
by the Professional Institute of the Public Service
of Canada for the home economists group whereby
wage increases for the first year were 5.6%, and
for the second year 5%. Other compensation items
e.g., improved vacation leave, were included in the
package so that the total compensation cost would
remain within the 6% and 5% parameters estab
lished by the Act. Similarly, an agreement cover
ing Air Canada's printing bureau employees pro
vided for a 5.5% wage increase for the first year, a
5% increase for the second year but improved
vacation leave benefits, etc. were also included.
These settlements and three others of a compa
rable nature were negotiated pursuant to section
16 of the Restraint Act:
16. The Governor in Council may, by order, terminate the
application of this Act in respect of an employee or a group of
employees to which this Act applies.
Section 16 was added as an amendment to Bill
C-124, which eventually became the Restraint
Act, and its purpose was explained by the Presi
dent of Treasury Board as follows:
It is important, Mr. Johnston said, that the parties have as
much leeway as possible within the limits of the legislation to
work out their own arrangement. For that reason the wording
of the amendment has been made deliberately simple to allow
for a variety of arrangements. If the parties voluntarily agree to
use, say, one-half of one percent of the 6 percent allowable
wage rate increase to introduce a paid maternity leave provision
in their agreement, and the remaining 5.5 percent to adjust
wage rates, and divide up the second year's 5 percent in a
somewhat similar way, then they will be found to be in keeping
with the spirit and intent of the legislation. Once the Governor
in Council is satisfied that their compensation plan for the two
years of application of the restraint program is in keeping with
the limits of the legislation, it would be allowed to terminate
the application of the legislation for that group of employees.
[Part of a press release quoted in a letter dated September 22,
1982 sent by the defendant to the plaintiff.]
In the third category mentioned above were
changes to three or four collective agreements
allowing for a compressed work week. Also, there
were changes to collective agreements providing
for the incorporation therein of pre-existing health
and safety standards; the standards thereby
became enforceable against the employer through
the grievance procedure of the Public Service
Staff Relations Act while previously they could
only have been enforceable against the employer
by instituting an action in tort in the courts. In
addition, evidence was given that in one instance a
ship's crew had been brought under new terms and
conditions of employment because a vessel (The
Sir Humphrey Gilbert) was being taken out of
service and another (The Bartlett) was substituted
therefor.
Needless to say, counsel for the plaintiff and
counsel for the defendants characterized this evi
dence in diametrically opposite ways. Counsel for /
the plaintiff characterized it as demonstrating that
negotiations which were still possible were essen
tially "de minimis" in nature. Counsel for the
defendants characterized it as demonstrating that
meaningful collective bargaining could still exist.
As I indicated to counsel, while evidence as to
what negotiations actually took place may be help
ful for illustrative purposes, the extent to which
bargaining actually took place under or outside the
Act is probably not too relevant. The issue, rather,
is the extent to which such bargaining was allowed
by the terms of the statute, or outside the statute;
the issue is essentially one of statutory construc
tion.
As noted above, the Act does not cover
employees not previously covered by a collective
bargaining agreement. Counsel for the plaintiff
argued that this was an oversight in the drafting of
the Act. Be that as it may, given the wide scope of
the Act, I do not think that the exclusion of this
small group, be it advertant or inadvertant,
changes the essential character of the disputed
legislation.
Secondly, counsel for the defendants argues that
collective bargaining with respect to compensation
items is still possible, with the approval of the
Governor in Council, through the mechanism of
section 16. I have considerable difficulty with the
idea that allowing for change by approval of the
Governor in Council preserves collective bargain
ing. The Governor in Council is not even the
employer although Treasury Board, a committee
of Council, is.
Counsel for the defendants argues that collective
bargaining, with respect to non-compensation mat
ters, is still possible pursuant to section 7:
7. The parties to a collective agreement, or the persons bound
by an arbitral award, that includes a compensation plan that is
extended under section 4 may, by agreement, amend any terms
and conditions of the collective agreement or arbitral award
other than wage rates or other terms and conditions of the
compensation plan.
What is a non-compensation item was the sub
ject of some disagreement and uncertainty. But, it
should be noted that "compensation" is defined by
the Act, subsection 2(1), as
... all forms of pay, benefits and perquisites paid or provided,
directly or indirectly, by or on behalf of an employer to or for
the benefit of an employee; [Underlining added.]
This is a very broad definition. It was interpret
ed by Treasury Board in a letter dated September
29, 1982 as including: pay, vacation leave, hol
idays, hours of work, rest periods, overtime includ
ing meal allowance, transportation reimbursement,
leave for staff relations matters, acting pay, sick
leave, marriage, bereavement or court leave,
injury-on-duty leave, maternity leave, leave for
family related responsibilities, education and
career development leave, severance pay. The most
significant conditions of employment not falling
within a compensation plan which were brought to
my attention are health and safety standards.
These, according to the evidence of Mr. Pageau,
do not form part of the compensation package.
In any event, I do not find it necessary to delve
unduly into the distinction between compensation
and non-compensation items of a collective agree
ment since I think neither section 7 nor section 16
can be said to preserve a right to collective bar-
gaming. Those sections prescribe ways in which
collective agreements can be changed: under sec
tion 7 by Treasury Board; under section 16 with
the approval of the Governor in Council. But to
prescribe ways by which collective agreements can
be changed is not synonymous with preserving a
right to collective bargaining. I do not see how
collective bargaining can be retained when the
ability to collectively withdraw services is not
retained by the employees. And, this is ruled out
by the operation of section 6 of the Restraint Act
and section 101 of the Public Service Staff Rela
tions Act, as noted above. What the Restraint Act
allows is for employees to make requests for
changes and for Treasury Board to consent to such
requests when they relate to non-compensation
items and for the Governor in Council to consent
to such requests when they relate to compensation
matters. But there is no element of bargaining in
this. Bargaining involves a giving and taking, it
involves more than just the right to make requests.
We would not say that a person was free to
bargain if he were compelled to purchase an
article. We would not say that a person was free to
bargain if he was compelled to sell an article.
Similarly, I do not think one can say that a right to
collective bargaining is preserved if there is no
right to collectively withdraw services.
Counsel for the defendants argued that, in any
event, the Restraint Act should be considered as
merely suspending bargaining rights for a two or
three-year period, and not as denying or destroying
them. A suspension for two or three years is
merely a polite way of describing a denial during
that period of time.
Freedom of association—Charter of Rights and
Freedoms
Having found that the Public Sector Compen
sation Restraint Act limits the right to bargain
which federal public servants would otherwise
have, it must be asked whether this is a right
(freedom) protected by the Canadian Charter of
Rights and Freedoms. The plaintiff argues that
paragraph 2(d) which guarantees "freedom of
association" encompasses, at least as far as trade
unions are concerned, the freedom (right) to
bargain.
In support of this contention counsel relies on
the principle of interpretation that constitutional
documents and particularly constitutional charters
of rights must be given a liberal and generous
interpretation. The cases cited to me were
Edwards v. Attorney-General of Canada, [1930]
A.C. 124 (P.C.), at page 136; British Coal Corpo
ration v. The King, [1935] A.C. 500 (P.C.), at
page 518; Attorney-General for Ontario and
Others v. Attorney-General for Canada and
Others and Attorney-General for Quebec, [1947]
A.C. 127 (P.C.), at page 154; Minister of Home
Affairs v. Fisher, [1980] A.C. 319 (P.C.), at pages
328 and 329; Curr v. The Queen, [ 1972] S.C.R.
889, at page 899; Attorney General of Quebec v.
Blaikie et al., [1979] 2 S.C.R. 1016, at pages 1029
and 1030 and Re Skapinker (1983), 40 O.R. (2d)
481 (C.A.), at page 484, appealed to the Supreme
Court of Canada [[1984] 1 S.C.R. 357].
There is no dispute concerning the proposition
for which reference to these decisions was made: a
constitutional document and particularly a consti
tutional charter of rights and freedoms should
receive
... a generous interpretation avoiding what has been called 'the
austerity of tabulated legalism' ....
(Minister of Home Affairs v. Fisher supra, at p. 328)
That does not mean, however, as counsel for the
defendants pointed out, that one is entitled to read
into a constitutional document or charter of rights
things that are not there. Refer: Attorney-General
of Fiji v. Director of Public Prosecutions, [1983] 2
W.L.R. 275 (P.C.), at page 281 and The Queen v.
Bowen, (unreported, November 10, 1983 (Ont.
H.C.) at pages 8 and 9.)
Counsel for the defendants argued that (1) the
plaintiff's argument respecting the scope of para
graph 2(d) of the Charter rested on a confusion
between a right and a freedom; (2) freedom of
association guaranteed to employees the freedom
to bargain; (3) but this freedom to bargain encom
passed only freedom to associate together, to for
mulate joint proposals and to present those pro
posals to their employer; it did not encompass the
right to strike and it did not obligate the employer
to bargain in good faith.
I accept the concept, inherent in the argument
counsel for the defendants made in drawing a
distinction between a right and a freedom
although I am not convinced that the words right
and freedom are the appropriate labels to use in
describing this distinction. It seems to me right
and freedom are words very often used synony-
mously and to try to separate them in a categorical
way may only create confusion. As I understand
the concept, it is that there is a difference between
a right (or freedom) belonging to someone which
imposes no positive burdens on others and a right
(or freedom) which imposes positive burdens on
others. Thus I agree that the right (or freedom) to
bargain, if constitutionally guaranteed, would not
go so far as to impose on the employer a duty to
bargain in good faith with the employees, or even
to listen to them. He might, with impunity, turn a
deaf ear, just as freedom of speech does not impose
on anyone the duty to listen to what is being said.
Professor Tarnopolsky, as he then was, draws
the distinction in his book The Canadian Bill of
Rights (2nd ed, 1975) at page 1:
It may be that an individual or a group demands non-interfer
ence from the state, at least in certain activities: this is a claim
for freedom or liberty. It may be, however, that the demand is
for state intervention to protect one's way of life against
encroachment by others, or to provide it either as a minimum
living standard or on the basis of equality with others: this is a
claim for the positive assistance of the state in the securing of
certain rights.
See also: Allman et al. v. Commissioner of the
Northwest Territories (1983), 44 A.R. 170
(N.W.T.S.C.) and Re Service Employees' Inter
national Union, Local 204 and Broadway Manor
Nursing Home, et al. and two other applications
(infra).
In any event, I agree that a right (or freedom)
to bargain, if constitutionally entrenched would
not carry with it a duty on the employer to bargain
in good faith or the right to have operating all the
mechanisms of arbitration and conciliation as pro
vided for in the Public Service Staff Relations
Act.
But there is a leap in counsel for the defendants'
argument from that proposition to the proposition
that freedom to bargain includes only the right to
associate together, to formulate common proposals
and to present these proposals to the employer.
The place of the freedom (right) to strike, or to
withdraw services collectively, (which is perhaps a
less emotional way of describing the activity) has
not been dealt with. A (freedom) right to collec
tively withdraw services does not place any positive
burden on the employer or on the state. It is action
entirely within the hands of those alleged to have
that freedom (right). As noted above, it is my view
that the very notion of a right to bargain must
carry with it more than merely the three elements
identified by counsel for the defendants.
Counsel for the defendants based his argument
that freedom to strike is not part of freedom to
bargain and his argument that freedom to bargain
is part of freedom of association on the comments
of Mr. Kaplan before the Special Joint Committee
of the Senate and the House of Commons on the
Constitution: Minutes of Proceedings and Evi
dence of the Special Joint Committee of the
Senate and of the House of Commons on the
Constitution of Canada, January 22, 1981, p. 43:
69-70.
At one time records of such debates were not
even admissible as relevant to the interpretation of
legislation. Now that the rule has become more
liberalized, we must not go too far the other way in
terms of assuming that such comments should
always be given significant weight. It should not be
forgotten that statements made in such circum
stances have an advocacy character. An attempt is
being made to convince the members of the com
mittee of the soundness of the Minister's
proposals.
Accordingly, I am not willing, in this case, to
give much weight to the Minister's interpretation
of the section unless there are other indicia leading
to the same conclusion. As noted above, I think the
Minister's position that freedom to bargain collec
tively does not include freedom to collectively
withdraw services flies in the face of the ordinary
meaning of the word bargain.
Finding that freedom to strike comes within the
concept freedom to bargain does not, however, end
the matter. One must also determine that freedom
to bargain is encompassed by the concept of free
dom of association.
Counsel for the plaintiffs arguments to this
effect were heavily based on the as yet unreported
decision, dated October 24, 1983, of the Ontario
Divisional Court in Re Service Employees' Inter
national Union, Local 204 and Broadway Manor
Nursing Home, et al. and two other applications
(1983), 44 O.R. (2d) 392. (That decision is pres
ently under appeal.) [Appeal dismissed: 1086-83,
judgment dated October 22, 1984, Ontario Court
of Appeal, not yet reported.] One can summarize
those arguments as: (1) it was the intention of the
drafters that this be the case as is evident from the
statements of Mr. Kaplan to the Joint Parliamen
tary Committee, (2) the history of freedom of
association at common law included the freedom
to bargain and strike; (3) the international cove
nants to which Canada has acceded protect this
right and (4) freedom of association must encom
pass protection for the fundamental purposes for
which an association is formed or else the freedom
could be rendered a hollow one. In the words of
Galligan J. in the Broadway Manor case, at page
409 of his decision:
I cannot imagine that the Charter was ever intended to guaran
tee the freedom of association without also guaranteeing the
freedom to do that for which the association is intended. I have
no hesitation in concluding that in guaranteeing workers' free
dom of association the Charter also guarantees at the very least
their freedom to organize, to choose their own union, to bargain
and to strike.
With respect to counsel's first argument, which
is supported by O'Leary J., at page 46 of his
judgment in the Broadway Manor case, I have
already indicated that I do not find it convincing.
Just as I am not willing to accept Mr. Kaplan's
interpretation of the concept of bargaining equally
I am not willing to accept his interpretation of the
concept of freedom of association.
With respect to the second argument, O'Leary
J. in the Broadway Manor case, at pages 47 and
following of his judgment, purported to find that
the history of freedom of association at common
law encompassed a freedom (right) to bargain
collectively and strike. He relied on Crofter Hand
Woven Harris Tweed Co., Ltd. v. Veitch, [1942] 1
All E.R. 142 (H.L.), at pages 158-159, and C.P.R.
v. Zambri, [1962] S.C.R. 609, at pages 619-621;
34 D.L.R. (2d) 654, at pages 656-657. But neither
of these cases deal with the history of the freedom
of association. Rather they deal with the history of
the right to strike.
The third argument, that based on the interna
tional covenants is found at pages 49-54 of
O'Leary J.'s decision. I do not draw the same
conclusion from a review of the international cove
nants as he does. The U. N. Universal Declaration
of Human Rights provides in article 20:
1. Everyone has the right to freedom of peaceful assembly
and association.
and in article 23:
4. Everyone has the right to form and to join trade unions for
the protection of his interests.
The U. N. International Covenant on Civil and
Political Rights acceded to by Canada on May 19,
1976 provides in article 22:
1. Everyone shall have the right to freedom of association
with others, including the right to form and join trade unions
for the protection of his interests.
The European Convention for the Protection of
Human Rights and Fundamental Freedoms pro
vides in article 11:
1. Everyone has the right to freedom of peaceful assembly
and to freedom of association with others, including the right to
form and to join trade unions for the protection of his interests.
I do not find that the wording of any of these
conventions carries with it a right to strike. They
seem to do no more than to accord to employees
the right to join together in association, to organ
ize and to advocate their common interests without
reprisal. See Schmidt and Dahlstrom v. Sweden
(1976), 1 E.H.R.R. 632 (Eur. Court H.R.), at
page 636, where Swedish legislation denying retro-
activity of benefits to employees who had engaged
in a strike, while granting retroactive benefits to
those who did not strike was held not to infringe
Article 11 of the European Convention.
The U.N. International Covenant on Economic,
Social and Cultural Rights to which Canada
acceded on May 19, 1976 and the I.L.O. Conven
tions do go further. The first of the above expressly
provides for a right to strike:
Article 8
1. The States Parties to the present Covenant undertake to
ensure:
(a) The right of everyone to form trade unions and join the
trade union of his choice, subject only to the rules of the
organization concerned, for the promotion and protection of his
economic and social interests. No restrictions may be placed on
the exercise of this right other than those prescribed by law and
which are necessary in a democratic society in the interests of
national security or public order or for the protection of the
rights and freedoms of others;
(b) The right of trade unions to establish national federations
or confederations and the right of the latter to form or join
international trade-union organizations;
(c) The right of trade unions to function freely subject to no
limitations other than those prescribed by law and which are
necessary in a democratic society in the interests of national
security or public order of for the protection of the rights and
freedoms of others;
(d) The right to strike, provided that it is exercised in
conformity with the laws of the particular country.
2. This article shall not prevent the imposition of lawful
restrictions on the exercise of these rights by members of the
armed forces or the police or of the administration of the State.
3. Nothing in this article shall authorize States Parties to the
International Labour Organisation Convention of 1948 con
cerning Freedom of Association and Protection of the Right to
Organize to take legislative measures which would prejudice, or
apply the law in such a manner as would prejudice, the
guarantees provided for in that Convention.
Convention 87 of the International Labour
Organization provides in part:
Article 2
Workers and employers, without distinction whatsoever, shall
have the right to establish and, subject to the rules of the
organisation concerned, to join organisations of their own
choosing without previous authorisation.
Article 3
1. Workers' and employers' organisations shall have the right
to draw up their constitutions and rules, to elect their repre
sentatives in full freedom, to organise their administration and
activities and to formulate their programmes.
2. The public authorities shall refrain from any interference
which would restrict this right or impede the lawful exercise
thereof.
Article 4
Workers' and employers' organisations shall not be liable to
be dissolved or suspended by administrative authority.
Article 5
Workers' and employers' organisations shall have the right to
establish and join federations and confederations and any such
organisation, federation or confederation shall have the right to
affiliate with international organisations of workers and
employers.
Article 8
1. In exercising the rights provided for in this Convention
workers and employers and their respective organisations, like
other persons or organised collectivities, shall respect the law of
the land.
2. The law of the land shall not be such as to impair, nor
shall it be so applied as to impair, the guarantees provided for
in this Convention.
Article 3 of this Convention, at least to the
extent that it guarantees a right "to organize their
. activities", seems to have been interpreted as
guaranteeing a qualified right to strike. (It should
be noted, however, that the Judicial Committee of
the Privy Council in the Collymore case (infra)
and the Alberta Court of Queen's Bench in Re
Alberta Union of Provincial Employees et al. and
the Crown in right of Alberta (1980), 120 D.L.R.
(3d) 590 both interpreted Convention 87 as not
including any such right.)
In any event, the fact that Canada has acceded
to international conventions which provide for a
right to strike does not mean that the Charter of
Rights which was intended to place certain rights
above the ordinary laws of the land intended to
incorporate all rights contained in those interna
tional conventions. There are many conventions
which Canada signs, seeing them as in conformity
with the ordinary law of the land, or being willing
to make the ordinary law conform thereto. But it is
an entirely different thing to draw from that the
intention to put such rights in a sense above the
ordinary laws of the land as is done in a constitu
tional charter. This is especially so when the inter
national convention rights in question are condi
tioned expressly to be only "exercised in
conformity with the laws of the particular coun
try" as is the case with the U.N. International
Convention 'on Economic, Social and Cultural
Rights, or implicitly limited as is the case with the
I.L.O. Convention. These two international con
ventions go far beyond what is usually considered
to be fundamental rights, or what can fairly be
said to be encompassed under the rubric "funda-
mental rights" in the Canadian Charter of Rights
and Freedoms.
In this regard, it is important to note that a
complaint was brought against the Government of
Canada by the Professional Institute of the Public
Service of Canada, the Canadian Labour Con
gress, the plaintiff in this action and the Confed
eration of Canadian Unions alleging that the
Restraint Act constituted a violation of trade
union rights as set out in the I.L.O. Conventions
87, 98 and 151: 'Case No. 1147, found in the
222nd Report of the Committee on Freedom of
Association, International Labour Office, Geneva
1-4 March 1983. The Committee on Freedom of
Association did not find that Canada contravened
the conventions.
As regards the alleged violation of Article 2 of Convention
No. 87, the Committee after a thorough examination of the
Act, considers that the right of workers in the federal public
service to establish and join organizations of their own choosing
without previous authorization would not appear to be adverse
ly affected.
The committee did not find that the Act
infringed article 3 of Convention No. 87:
The denial of the right to strike in the present case, despite
the measures taken to place certain restrictions on wage bar
gaining, is nevertheless accompanied by procedures which allow
not only for bargaining beyond the minimum levels fixed by the
new legislation (i.e. 6 per cent and 5 per cent), but which in
certain cases, allow for exceptions to be made as well as
providing for mediation in case of dispute. [On this point the
Committee's interpretation of the effect of the Restraint Act is
different from my own.]
Article 4 of Convention 98 was also held not to
have been infringed:
As regards the allegation that Article 4 of Convention No. 98
is violated by the suspension of collective bargaining imposed
by the Act, the Committee would recall the criteria established
by I.L.O. supervisory bodies ... namely that stabilization
measures restricting the right to collective bargaining might be
acceptable on condition that they are of an exceptional nature,
and only to the extent that they are necessary, without exceed
ing a reasonable period, and that they are accompanied by
adequate safeguards to protect workers' living standards.
Articles 7 and 8 of Convention No. 151 were held
not to have been violated because:
Article 7 allows a certain flexibility in the choice of proce
dures to be issued in the determination of the terms and
conditions of employment ... some of the parties in the present
case are continuing negotiations on certain issues ... the Com
mittee is unable to conclude that public employees cannot
participate in the determination of their terms and conditions of
employment ... .
As regards the alleged breach of Article 8 of Convention No.
151 concerning the settlement of disputes .... This Article has
been interpreted as giving a choice between negotiation or other
procedures ... in settling disputes. In the present case, the
temporary exclusion of third party arbitration procedures that
are normally available under the Public Service Staff Relations
Act would not conflict with the requirements of Article 8 ....
See also Re Alberta Union of Provincial
Employees et al. and the Crown in right of Alber-
ta (1980), 120 D.L.R. (3d) 590 where the Alberta
Court of Queen's Bench held that provincial legis
lation limiting the right to strike and limiting the
matters which could be dealt with by an arbitra
tion board did not violate Canada's international
obligations under I.L.O. Convention No. 87 or
under the International Covenant on Economic,
Social and Cultural Rights.
The fourth argument found in the Broadway
Manor case is perhaps the most compelling: that if
the purposes for which an association is organized
are not protected by the right to freedom of asso
ciation there is a danger that the freedom itself
can be undercut. While I would not want to be too
categorical in responding to that argument, I think
at least one can say that the right to bargain
collectively (including therein the right to collec
tively withdraw services) is not protected by the
constitutional guarantee of freedom of association.
A useful starting point is the statement by Lord
Wilberforce in Minister of Home Affairs v. Fisher
(supra) cited by the plaintiff [at page 329]:
A constitution is a legal instrument giving rise, amongst
other things, to individual rights capable of enforcement in a
court of law. Respect must be paid to the language which has
been used and to the traditions and usages which have given
meaning to that language. [Underlining added.]
I do not find anything in the traditions and
usages in Anglo-Canadian jurisprudence which
would lead to the conclusion that the usage of the
term "freedom of association" is meant usually to
include a freedom to bargain. Indeed the decision
in Collymore v. Attorney-General, [1970] A.C.
538 (P.C.), indicates quite the contrary. That deci
sion relates to a provision in the Constitution of
Trinidad and Tobago which declared that freedom
of association was a fundamental right which no
law could abrogate. The Industrial Stabilization
Act, 1965, was enacted imposing a system of com
pulsory arbitration by an industrial court and pro
hibiting any trade union calling a strike. The Act
was challenged as an unconstitutional infringe
ment of a guaranteed fundamental right. It was
held that the Act undoubtedly abridged the free
dom to bargain collectively and the freedom to
strike, but these could not be equated with the
right of freedom of association.
Lord Donovan, in coming to his decision, quoted
a passage from the Court below, at page 547:
"In my judgment, then, freedom of association means no
more than freedom to enter into consensual arrangements to
promote the common interest objects of the associating group.
The objects may be any of many. They may be religious or
social, political or philosophical, economic or professional, edu
cational or cultural, sporting or charitable. But the freedom to
associate confers neither right nor licence for a course of
conduct or for the commission of acts which in the view of
Parliament are inimical to the peace, order and good govern
ment of the country."
Equally the jurisprudence in the United States
has found that freedom of association extends only
to the right to join together, to persuade others to
do so, to engage in advocacy on behalf of its
members. In the decision Hanover Tp. Federation
of Teachers, Local 1954 (AFL-CIO) v. Hanover
Community School Corp. C.A.Ind. 457 F.2d 456
(1972) (7th Cir.), it is said at pages 460-461:
... protected "union activities" include advocacy and persua
sion in organizing the union and enlarging its membership, and
also in the expression of its views to employees and to the
public. For that reason, the State may not broadly condemn all
union activities or discharge its employees simply because they
join a union or participate in its activities. It does not follow,
however, that all activities of a union or its members are
constitutionally protected.
Thus, the economic activities of a group of persons (whether
representing labour or management) who associate together to
achieve a common purpose are not protected ....
See also Smith v. Arkansas State Highway
Employees, 441 U.S. 463 (1979) (8th Cir.).
Counsel for the plaintiff argued that the United
States jurisprudence is of limited value because the
freedom of association guaranteed under that
country's Constitution is an outgrowth of the First
Amendment which protects freedom of religion,
speech, the press and assembly but does not
expressly refer to a freedom of association. See
Tribe, American Constitution Law (1978) at pages
576, 702 and 703.
While this is true, the presence of a reference in
section 2 of the Charter to a freedom of associa
tion may do no more than reflect the fact that it
was drafted almost 200 years after the United
States constitutional amendment and at a time
when freedom of association had been interpreted
in that country as an outgrowth of the freedom to
assemble. I note that in the Canadian Bill of
Rights, paragraph 1(e), freedom of assembly and
association are linked as related rights.
In addition, as noted above I do not find any
thing in the international law context which com
pels the broad interpretation of freedom of associa
tion which is contended for. I do not think it would
have been intended in a section of the Charter of
Rights and Freedoms dealing with fundamental
rights to include a right that is essentially econom
ic in nature without some more express wording
indicating this to be the case.
In my view the clause "freedom of association"
guarantees to trade unions the right to join to
gether, to pool economic resources, to solicit other
members, to choose their own internal organiza
tional structures, to advocate to their employees
and the public at large their views and not to
suffer any prejudice or coercion by the employer
or state because of such union activities. But it
does not include the economic right to strike.
After writing the above my attention was called
to a decision of the British Columbia Court of
Appeal, dated March 5, 1984 in Dolphin Delivery
Ltd. v. Retail, Wholesale and Dept. Store Union,
Loc. 580, [1984] 3 W.W.R. 481. That Court came
to the same conclusion as I have on the interpreta
tion of the scope of "freedom of association".
Reasonable Limits ... Demonstrably Justified
It is not necessary for me to deal with the
applicability of section 1 of the Canadian Charter
of Rights and Freedoms because of the conclu
sions I have come to above. Nevertheless, since I
expect that a higher court than this will be seized
of this matter shortly and because an assessment
of the evidence is necessarily involved I will review
the evidence and arguments which were presented
on this point.
Section 1 provides that the rights and freedoms
set out in the Charter are guaranteed.
1. ... subject only to such reasonable limits prescribed by
law as can be demonstrably justified in a free and democratic
society.
Four economists were called to give evidence
about the reasonableness, or lack thereof, of the
government's restraint measure. Professors Ascah,
Watkins, McCallum and Purvis. Whether the test
of section 1 has been met, that is, whether an
abridgment of a constitutional right is a "reason-
able limit ... demonstrably justified ..." , is not
an economic question. But economic evidence may
very well be the starting point in a case such as
this. The task of weighing what constitutes a "rea-
sonable limit", what is a justifiable abridgment of
constitutional rights under section 1 necessarily
involves an assessment of the economic benefit to
society as a whole, resulting from the restraint,
against the cost of the infringement to individuals.
Professor McCallum's description of the role of
economic opinion in this balancing exercise is very
apt:
... economists have no special expertise in deciding whether or
not the overall costs of controls are greater than or less than the
overall benefits. Such a judgment requires one to weigh the
costs of diminished rights or freedoms against the benefits of
lower unemployment.
This is an apples and oranges comparison ... not an issue
that can be resolved on purely economic grounds.
Nevertheless the economist does have a role to play. The
economist may be able to provide an assessment of whether the
potential economic benefits of wage controls are large or small.
If these benefits are large, then the ultimate decision makers
will know that if they rule out controls on non-economic
grounds, they will be doing so at high economic cost. On the
other hand, if these potential economic benefits are very small,
then controls may be ruled out for non-economic reasons at
little cost in terms of economic considerations.
Three of the four economists giving evidence
seemed to agree that at the time the government
introduced the Restraint Act inflation was a seri
ous problem about which the government should
have been concerned. Professor Watkins disagreed;
he argued that unemployment, not inflation was
the problem. In his view, inflation at that time was
coming down and, in any event, the social and
economic costs of unemployment are greater than
those of inflation.
In retrospect, it may have been the case that
inflation was ameliorating but I accept the evi
dence given that it was a reasonable economic
judgment to have concluded, at the time, that
inflation was a problem which needed government
intervention. The evidence was that wage and price
inflation had increased to double digit levels;
Canada's inflation was exceeding that of the
United States; and, the economy was reacting only
slowly to the monetary and fiscal restraint policies
which had been in effect since 1979.
I accept also the evidence that two options open
to the government to deal with the inflation prob
lem were (1) policies of fiscal and monetary
restraint and (2) wage-price control measures.
With respect to the second option, conflicting evi
dence was given as to whether control measures
with respect to the Canadian economy could ever
be effective. This evidence related to measures of
general control relating to the whole or at least the
major part of the Canadian economy. Professor
Ascah's opinion was that such measures could
never be effective to control inflation because the
Canadian economy is a small open one; a large
part of its production is exported (25.4% in 1982)
and a large part of its purchases are imported
(25.9% in 1982): interest rates are also determined
to a large extent in the international market. He
pointed to the government's A.I.B. program of
1975-1978 as illustrative of the fact that control
programs do not work in Canada. While the A.I.B.
program restrained wages the decline in overall
inflation was not so marked primarily because of
exogenous food price increases and energy price
increases.
Professor McCallum's evidence, on the other
hand, was to the effect that "mainstream Canadi-
an economists, while generally not liking controls
because of a preference for free markets, have at
least acknowledged that they may at times be
needed or useful". Thus, Professor Lipsey, author
of a brief prepared for the Canadian Labour Con
gress in opposition to the Anti-Inflation Board in
1975, by 1981 had changed his view so that he was
willing to advocate controls:
But if present policies do not work, I could be prepared to try
controls as a part of a full policy package ... There could of
course be constitutional problems and labour's hostility would
be understandably strong. The late AIB's philosophy was based
on the assumption that because under normal market condi
tions prices tend to follow wages, the same thing could hapen
under the abnormal conditions of enforced wage restraint. The
AIB had some modest [success] restraining the effect on wages
[sic], but that prices did not follow wages is a good example of
Lucas's warning that the empirical relations of one policy
regime cannot be expected to stand up under another policy
regime ....
R.G. Lipsey, "The understanding and control of inflation: is
there a crisis in macro-economics?" Can. J. Ec., Vol. XIV, no.
3, Aug. 1981, page 545 at page 569.
I accept Professor McCallum's evidence that
... all of the studies conclude that the A.I.B. had a substantial
negative effect on wage inflations typically the estimates sug
gest that the direct effect of the A.I.B. was to reduce wage
settlements by some two to four percentage points in each of
the three years of the program. Furthermore, the more recent
studies ... also tested for a post-controls "bubble" effect. Was
there an unusually high level of wage settlements or a catch-up
effect immediately following the removal of controls? All of the
three studies just mentioned conclude that there was no such
effect.
.... There is a strong consensus among Canadian economists
that the A.I.B. had a substantial negative effect on wage
inflation.
Professor McCallum agreed with Professor
Ascah that the overall effect on inflation generally
had been disappointing because of rises in food
prices and energy prices during the years in ques
tion. But both agreed that without the A.I.B.
program the overall rate of inflation during those
years would have been higher.
The evidence was clear, however that monetary
policy and not wage-price controls is the primary
tool by which to combat inflation. Wage-price
controls, at most, are supplementary measures. I
quote again from Professor McCallum's evidence:
... controls are not a substitute for "monetary restraint" if by
that term we mean a declining rate of growth of the money
supply. Ultimately money growth must come down with infla
tion, but the object of controls is to force inflation down at a
faster rate than could otherwise occur, thereby avoiding or
moderating the recession that would otherwise be required ....
Thus controls may be seen as a substitute for the recessive and
high unemployment that could otherwise occur as the unwanted
by-product of a policy of monetary restraint.
Professor Lipsey, in his article cited above
expressed the same view, at page 570
... wage-price controls can ... be used in an attempt to cut
through the inflationary inertias and accomplish what the
Keynesian view says the free market cannot easily do—get
wage inflation down rapidly in line with the much lower
inflation rate, which is all that is being validated by monetary
and fiscal policy. (We have no experience to tell us how these
controls might work as part of a total package, although we
have ample experience to tell us that on their own they have no
lasting effect on the price level.)
Let me be clear ... incomes policies are useless (as well as
costly) on their own. The package must include higher mone
tary and fiscal restraint to ensure that the expansion of aggre
gate money demand will be consistent with the much lower rate
of inflation temporarily brought about by the controls.
And Professor Purvis:
There is one, and only one way to effect a lasting reduction in
an economy's underlying inflation rate: to slow the rate of
growth of nominal demand in the economy by slowing the rate
of expansion of the money supply ... monetary restrictions.
And of wage-price controls, if it is chosen to use
them, he said:
... such policies must be used in conjunction with monetary
restriction, or they will be doomed to failure
Furthermore, the role of wage-price controls is one
of:
... reducing the costs associated with monetary restriction; that
is, in terms of reducing the amount and duration of unemploy
ment that is incurred during the disinflation.
Thus it seems reasonable to conclude that a
general wage and/or price controls program can be
a reasonable economic policy as an adjunct to or
supplementary measure to, an overall monetary
restraint program. That leaves the question of
whether the government's selective program, appli
cable only to public servants was a reasonable
economic measure.
In many instances one indicia of the economic
reasonableness of such a program would be the
actual effect it had. Thus if it could be shown that
the program actually or even probably lessened
unemployment this could be a significant factor
respecting economic reasonableness. In this case,
however, no such evidence is available. The evi
dence clearly indicates that the decline in inflation
which actually occurred was due to the world
recession and not the government's 6 and 5
program.
The economists called by the defendants testi
fied as follows:
Professor McCallum:
There is no reliable or `scientific' way of saying how much of
the fall in inflation has been due to the recession and how much
to 6 and 5.
... it is possible that the program has had a favourable
psychological effect in terms of lowering people's expectations.
... all that can be said is that 6 and 5 might have had some
effect.
Professor Purvis:
... the policy may have aided in bringing inflation down at a
more rapid rate and at a lower cost in terms of unemployment.
These are the strongest statements found in the
economic evidence about the actual effect of the
government's program. Of course, the evidence of
Professors Watkins and Ascah is very strongly
worded the other way. Indeed Professor Watkins is
of the view that the program made the economic
situation worse because it deepened the recession.
In the light of all the evidence given, it seems
reasonable to conclude that the government's 6
and 5 program played little part in the reduction
of inflation which actually occured.
That having been said, however, it does not
mean that the program could not have been a
reasonable economic judgment at the time it was
made. Reasonableness does not demand clairvoy
ance and ability to foresee exactly what will in fact
happen. It is the time at which the judgment was
made that is relevant.
Professors McCallum and Purvis contend that
at the time the 6 and 5 program was implemented
it could have been characterized as a reasonable
economic measure. Professor Purvis' evidence is as
follows:
In the spring of 1982 when the government was formulating its
6 and 5 program the state of the economy was such that there
was a reasonable expectation that controls could play a con
structive role in helping the economy achieve a lower inflation
rate.
... the 6 and 5 program appears as a reasonable program to
have instituted. By directly controlling some wages in the
economy (i.e., wages in the federal public sector, widely inter
preted) and mounting a substantial campaign to enlist the
voluntary cooperation of the private sector, the program clearly
was potentially a constructive addition to the policy of severe
monetary restrictions and may have aided in bringing inflation
down at a more rapid rate and at a lower cost in terms of
unemployment.
Professor McCallum:
I think, however, that it is fair to say at the time of the
introduction of 6 and 5 there were reasonable grounds for the
belief that the program would assist in reducing inflation.
Professor Watkins and Ascah take the opposite
view. They point out that only 5% of the work
force was covered by the Restraint Act. They point
out that even as part of an overall push to encour
age voluntary wage restraint the Restraint Act
could not have been expected to work to reduce
inflation because voluntary programs do not work.
The conclusion that voluntary programs do not
work, at least in the context of the Canadian
economy and its decentralized labour relations
system, was a conclusion shared by at least Profes
sors Ascah, Watkins and McCallum. Professor
Ascah called attention to the fact that in 1982
Professor McCallum in writing jointly with a col
league had said:
It should be clear that we are not proposing a program limited
to public-sector wage controls of the kind instituted in British
Columbia in 1982.... Public-sector wage controls are not in
themselves sufficient to have much effect on inflation, and also
it seems undersirable to single out civil servants for wage
controls, particularly when the public sector lagged (very
slightly) behind the private sector in terms of wage settlements
in 1981 and early 1982....
Barber and McCallum. "Controlling Inflation." The Canadian
Institute for Economic Policy, 1982, at page 100.
Professor McCallum's response was to explain
that in writing that publication he had been writ
ing as an advocate while in giving evidence in this
case he was trying to take a more objective
approach.
Professors Ascah and Watkins contend that the
Restraint Act was a charade designed to give the
appearance of doing something without any
reasonable expectation that it could in fact do so.
Professors McCallum and Purvis argue that the
Restraint Act might have had some psychological
effect and could reasonably have been expected to
have some psychological effect as an aid to bring
ing down inflation; a psychological effect of break-
ing down inertias and expectations. Professor
Ascah's view was that by its very limited nature
(applicable only to 5% of the labour force) it could
not have reasonably been expected to have had this
psychological dampening effect because it would
not be seen as demonstrating any serious resolve
on the part of the government to control wages
generally. Professor Ascah characterized the pro
gram as a political decision with no economic
rationale. Professor Watkins was of the view that
it was designed for a completely ulterior motive: to
weaken the public service unions.
It is clear from all this evidence and from the
statements made by the ministers in the House of
Commons that at the most the government's inten
tion in introducing the Restraint Act was to imple
ment a measure designed for its indirect effect and
not as a direct economic measure to bring down
inflation. The Deputy Prime Minister and Minis
ter of Finance said:
The private sector and the provinces could not be expected to
accept income restraint unless the Government of Canada
showed leadership in the conduct of its own affairs. The
government has therefore decided to lead the way by imple
menting the proposed strategy in the federal public sector for a
period of two years ....
I would like to emphasize that in the government's view federal
public sector employees are no more responsible for inflation
than any other group in the society. They too have been trying
to catch up with rising prices, but their incomes have risen no
more, and often rather less, than those of employees in other
sectors ... If other sectors follow our leadership, federal
employees will fare as well as others .... (Underlining added.)
House of Commons Debates, June 28, 1982, at page 18878.
The Minister's statements that federal
employees could not be said to have contributed to
inflation any more than any other group and that
their wage raises in recent years had lagged behind
the private sector generally were borne out by the
evidence given by Professors Ascah and McCal-
lum. One factor the Minister did not note, but
which came out in evidence is that federal
employees do have greater job security than pri
vate sector employees. Professor McCallum testi
fied that the average level of employment was 3
percent lower in 1982 than in 1981 for the econo
my as a whole, the level of employment in the
general government sector rose by .9 percent be
tween 1981 and 1982.
The President of the Treasury Board, in speak
ing to the legislation said:
All realized that it was imperative for the federal government
to accentuate the anti-inflationary impact of its economic
policies by taking a more determined stand on wage rates. The
federal public service compensation restraint program alone
cannot resolve all the economic problems Canadians are wres
tling with today. It should be seen as a serious and striking
example that all Canadians, employers and employees,
individually and collectively, must follow if they are the least
bit concerned with maintaining their competitive position
abroad and their standard of living at home. (Underlining
added.)
House of Commons Debates, July 9, 1982, at page 19182.
The Restraint Act was thus designed to have a
demonstrative effect, not to serve as a direct eco
nomic lever to combat inflation. At most, it seems
to have been designed to create some psychological
effects, some dampening of expectations.
Having dealt with the economic justification for
the Restraint Act, it is now necessary to consider
the legal question. It is now necessary to ask
whether a measure such as this could be said to
meet the test required by section 1 of the Canadi-
an Charter of Rights and Freedoms. I think it
could not. If freedom to bargain collectively was a
constitutionally guaranteed right I would hold that
the Restraint Act was not a "reasonable limit ...
demonstrably justified" in the sense of section 1.
In argument counsel for the defendants seemed
to define the test required by section 1 as requiring
a legislative measure enacted by Parliament which
had some reasonable rationale. This seems to have
been the test applied by the Ontario Divisional
Court in the Broadway Manor case (supra). I
think a stronger test than that is required, at least,
when one is dealing with limitations on fundamen
tal freedoms set out in section 2. One must not
forget that there is always section 33 which allows
Parliament to expressly override the rights guaran
teed by section 2. If section 1 requires no more
than some reasonable legislative rationale there
would be no scope left for section 33 unless one
assumes that Parliament would deliberately decide
to legislate without a reasonable rationale.
It may very well be that the test to be met in
order to meet the requirements of section 1 will
vary depending upon the type of rights to which a
limitation is being made. But, I think the test
required to justify an abrogation of a fundamental
right is a very substantial one. I do not think in
this case that the benefit accruing to society as a
whole as a result of the government's Restraint
Act is sufficiently substantial to justify an abridg
ment of constitutionally guaranteed individual
rights. In this regard I would note that more than
a "reasonable limit" is required. The words
"demonstrably justified" require more than merely
some reasonable rationale. And they require more
than to show that it was Parliament's judgment
that the limitation was justified—this is provided
for by meeting the test "prescribed by law" set out
in section 1. The limitation in this case being
designed for its demonstration effect, and to play,
at best, an indirect part in the attaining of the
objective sought (the reduction of inflation) does
not meet the requirements of section 1.
One last point respecting the evidence tendered
must be dealt with. Written evidence prepared by
Professor Ascah was tendered as rebuttal evidence.
This was objected to by counsel for the defendants
on the ground that the plaintiff was splitting his
case. I reserved judgment. Having now had an
opportunity to read carefully the text prepared by
Professor Ascah in the light of the expert evidence
that had been given by the defendants' witnesses, I
find that enough of it is properly admissible as
rebuttal evidence to allow the whole text to go in.
The rest tends to be duplication and unnecessary
but it is not so clearly an instance of the plaintiff
splitting his case as to be inadmissible.
Fundamental Justice—Charter of Rights
The plaintiff's second main argument is that the
Restraint Act is invalid as an infringement of
section 7 of the Canadian Charter of Rights and
Freedoms.
7. Everyone has the right to life, liberty and security of the
person and the right not to be deprived thereof except in
accordance with the principles of fundamental justice.
The argument is based on the contention that
"liberty" in section 7 includes the freedom to enter
into contracts particularly contracts relating to the
terms of employment. It is argued that (1) the
Charter as a constitutional document should be
given a liberal and generous interpretation; (2) the
ordinary dictionary definition of the word liberty
extends beyond mere physical liberty and is broad
enough to encompass the right claimed; (3) liberty
in section 7 must include more than physical liber
ty because physical liberty is adequately protected
by other sections of the Charter, for instance,
sections 8, 9, 10 and 12. If this argument is
accepted it would also be necessary to show a
denial of the principles of "fundamental justice" in
order to demonstrate a breach of section 7. Coun
sel for the plaintiff argues that "fundamental jus
tice" in section 7 means more than "natural jus
tice" or "procedural fairness"; that it has a
substantive content. He relies for this proposition
on the decision of the British Columbia Court of
Appeal in Reference re Section 94(2) of the Motor
Vehicle Act (1983), 147 D.L.R. (3d) 539 [at pages
541-542]:
The contention of the Attorney-General was that the phrase
"the principles of fundamental justice" should be equated with
the principles of natural justice and reference was made to de
Smith's Judicial Review of Administrative Action, 4th ed.
(1980) ... at p. 156:
Upon this view of the matter the effect of s. 7 is to enshrine
in the Constitution the principles of natural justice. That is
certainly one view of the matter. It does not, however, give any
effect to s. 52 of the Constitution Act, 1982 which can be
viewed as effecting a fundamental change in the role of the
courts. The Bill of Rights allowed the courts to test the content
of federal legislation, but because the Bill was merely a statute,
its effectiveness was hampered by the equally persuasive "pre-
sumption of validity" of federal legislation. The Constitution
Act, 1982 in our opinion, has added a new dimension to the role
of the courts; the courts have been given constitutional jurisdic
tion to look at not only the vires of the legislation and whether
the procedural safeguards required by natural justice are
present but to go further and consider the content of the
legislation.
The court therefore held subsection 94(2) of the
British Columbia Motor Vehicle Act [R.S.B.C.
1979, c. 288, as am. by S.B.C. 1982, c. 36, s. 19]
ultra vires. That subsection provided that driving
while prohibited from doing so or while one's
licence was suspended was an absolute liability
offence in which guilt was established by proof of
driving whether or not the defendant knew of the
prohibition or suspension. See also R. v. Stevens
(1983), 145 D.L.R. (3d) 563 where the Ontario
Court of Appeal assumed [at page 565] "without
in any way deciding" that s. 7 of the Charter
allowed for judicial review of the substantive con
tent of legislation.
It was argued that the Restraint Act was con
trary to the principles of fundamental justice in
the substantive sense because of its discriminatory
nature. That is, it limited the rights of 5% of the
population, whose wage raises had been trailing in
recent years, and when the likelihood of the
restraint measure being able to accomplish or con
tribute to a diminution of inflation was marginal
at best.
Counsel recognized that his argument that sec
tion 7 encompasses substantive due process was
not an easy one to make. Firstly, the phrase "prin-
ciples of fundamental justice" would appear to
come from paragraph 2(e) of the Canadian Bill of
Rights. Those words were interpreted by the
Supreme Court of Canada in Duke v. The Queen,
[1972] S.C.R. 917, at page 923, as essentially
equivalent to procedural due process. Secondly,
evidence given before the Joint Parliamentary
Committee on the Constitution was to the effect
that, at least in the view of the officials of the
Department of Justice, the words "fundamental
justice" cover only the same grounds as "procedu-
ral due process", "natural justice" or "procedural
fairness". See: Proceedings of the Senate and
House of Commons Committee on the Constitu
tion, January 27, 1981 at pages 46:32 and follow
ing. Counsel for the plaintiff thought that this view
was qualified somewhat by the opinion expressed
at page 46:33:
There is a possibility that in a particular context one could see
it [fundamental justice] as having a somewhat expanded
meaning.
That quotation, however, goes on to say:
... but there is no jurisprudence which would indicate that it is
clearly broader than the principles of fundamental justice that
have been articulated in all of the various common law
decisions.
In addition, there are two cases which have
taken a different view from that of the British
Columbia Court of Appeal in the Motor Vehicle
Act Reference case noted above. In R. v. Hayden,
[1983] 6 W.W.R. 655, the Manitoba Court of
Appeal held that section 7 of the Charter relates
only to procedural fairness; the Ontario Supreme
Court was of the same view in Re Mason; Mason
v. R. in Right of Can. (1983), 35 C.R. (3d) 393. I
would also note that the British Columbia Court of
Appeal in the Motor Vehicle Act Reference case
when referring to de Smith's comments on natural
justice quoted only from page 156 of that text. The
author goes on at page 157 to say that the follow
ing phrases found in the jurisprudence are synony
mous with natural justice: " `substantial justice',
'the essense of justice', `fundamental justice', 'uni-
versal justice', `rational justice' ...". (Underlining
added.) Reference should also be made to Hogg,
Canada Act 1982 Annotated, (1982) at page 28
and Tarnopolsky and Beaudoin, The Canadian
Charter of Rights and Freedoms (1982) at
page 18. The view expressed in those texts is that
section 7 relates to procedural fairness.
The better view does seem to be that section 7
relates only to procedural fairness but in any event
I think counsel's argument founders with its first
step. That is, I do not think the term "liberty" in
section 7 encompasses freedom of contract.
I come to this conclusion for much the same
reasons that I reject the argument that freedom of
association encompasses freedom to bargain. The
words "life, liberty and security of person" are not
without some tradition and background. I have not
been cited any authority for the proposition that
that tradition has included freedom to contract as
within the meaning of "liberty".
In addition, the term takes some colouration
from the context within which it exists in the
Charter. Section 7 seems to be framed as an
introductory umbrella, as counsel for the defend
ants put it, to the seven sections which follow.
These, including section 7, fall under the rubric
"legal rights". Freedom to contract is an economic
right.
See also Tarnopolsky and Beaudoin, The
Canadian Charter of Rights and Freedoms
(1982), at page 270:
We believe that the term "liberty", utilised in s. 7, must be
understood in a restrictive sense. Section 7 is concerned with
physical liberty of the person, the right to dispose of one's own
body, of one's person; in this context the right to liberty cannot
signify "the right to a free exercise of human activity", contrac
tual freedom, freedom of choice of mode of life, professional
freedom, etc. Those infringements on liberty which are
designed to restrict the free disposition of one's body or of one's
physical person, including the interdiction on suicide, are out
side the infringements on liberty enumerated at ss. 8-10.
Included in these sections are those infringments on liberty
contained in measures imposing medical or prophylactic
treatment.
The Enjoyment of Property—Due Process—
Canadian Bill of Rights
Section 1 of the Canadian Bill of Rights, S.C.
1960, c. 44, provides:
1. It is hereby recognized and declared that in Canada there
have existed and shall continue to exist ...
(a) the right of the individual to life, liberty, security of the
person and enjoyment of property, and the right not to be
deprived thereof except by due process of law; (Underlining
added.)
Counsel for the plaintiff argues that persons
covered by collective agreements in which prospec
tive wage rises were "rolled back" by the Restraint
Act (for example the CR, ED and EU groups)
were deprived of property without due process of
law. He argues that a right to a wage rise at a
future date under an existing collective agreement
is a property right vested and enforceable. It is
argued that this is not substantially different from
the type of property interest a remainderman holds
during the tenancy of a life tenant.
I am not convinced that this is so. A remainder-
man has nothing to perform. He must only contin
ue to exist in order to obtain the remaindered
estate. An employee under a collective agreement
must, however, provide the services he has con
tracted to provide before he is entitled to the
wages.
In any event, "without due process of law" in
the Canadian Bill of Rights has not been inter
preted as including substantive due process. Even
if the Supreme Court left the door open a crack,
towards this expanded interpretation in Curr v.
The Queen, [1972] S.C.R. 889, at pages 899-900,
as plaintiff argues, jurisprudence since that time
has not opened that door. Indeed, Chief Justice
Laskin in giving the majority decision of the Court
in the Curr case at page 902, warned against
entering the "bog or legislative policy making"
which is involved in considerations of economic
due process. Professor Tarnopolsky, as he then
was, in his book The Canadian Bill of Rights (2nd
ed., 1975), at pages 234-235, summarizes the
jurisprudence which exists on this point:
Quite clearly, in view of the cases discussed in this part, it
would appear that the due process clause will not be applied so
as to protect property rights affected by federal expropriation
and nationalization laws, or confiscation provisions in federal
statutes arising out of proscribed activities ... the expropria
tion power is based upon economic policy decisions which
should be the sole prerogative of the legislative body ....
I accept this as an accurate statement of the law
respecting the interpretation of the "due process"
clause in the Canadian Bill of Rights. If, however,
the procedures by which such property was expro
priated were unfair or questionable then the due
process clause might be invoked.
Equality Before the Law—Canadian Bill of Rights
Paragraph 1(b) of the Canadian Bill of Rights
provides:
1. It is hereby recognized and declared that in Canada there
have existed and shall continue to exist ...
(b) the right of the individual to equality before the law ...
It is argued that the Restraint Act infringes this
right because it singles out federal public servants
for restrictive treatment without rational grounds.
The argument is that the legislation is capricious
and arbitrary because it singles out 5% of the work
force, who were admittedly no more responsible
for inflation than any other group and whose wage
rises in recent years had lagged behind the private
sector. It is argued, as noted above, that the pur
pose of the legislation was to create an illusion that
the government was doing something to combat
inflation.
It is admitted that this branch of the plaintiff's
argument depends upon the interpretation of and
application of the Supreme Court decisions in The
Queen v. Drybones, [1970] S.C.R. 282; Attorney
General of Canada v. Lavell, [1974] S.C.R. 1349;
R. v. Burnshine, [1975] 1 S.C.R. 693; Prata v.
Minister of Manpower and Immigration, [1976] 1
S.C.R. 376 and MacKay v. The Queen, [1980] 2
S.C.R. 370.
These cases are not easy to apply. I take as the
starting point the decision of Mr. Justice Ritchie
in Attorney General of Canada v. Lavell at page
1365:
... having regard to the language employed in the second
paragraph of the preamble to the Bill of Rights, the phrase
"equality before the law" as used in s. 1 is to be read in its
context as a part of "the rule of law" to which overriding
authority is accorded by the terms of that paragraph.
In this connection I refer to Stephens Commentaries on the
Laws of England, 21st Ed. 1950, where it is said in Vol. III at
p. 337:
Now the great constitutional lawyer Dicey writing in 1885
was so deeply impressed by the absence of arbitrary govern
ments present and past, that he coined the phrase 'the rule of
law' to express the regime under which Englishmen lived;
and he tried to give precision to it in the following words
which have exercised a profound influence on all subsequent
thought and conduct.
'That the "rule of law" which forms a fundamental princi
ple of the constitution has three meanings or may be
regarded from three different points of view .... '
The second meaning proposed by Dicey is the one with which
we are here concerned and it was stated in the following terms:
It means again equality before the law or the equal subjec
tion of all classes to the ordinary law of the land adminis
tered by the ordinary courts; the 'rule of law' in this sense
excludes the idea of any exemption of officials or others from
the duty of obedience to the law which governs other citizens
or from the jurisdiction of the ordinary courts. [Underlining
added.]
There is an additional aspect, however, to the
concept "equality before the law" as appears from
the decision of Mr. Justice Ritchie speaking for
the Court in The Queen v. Drybones (supra) and
the decision of Mr. Justice Martland speaking for
the Court in R. v. Burnshine, [1975] 1 S.C.R. 693.
This second aspect is elaborated by Mr. Justice
Martland at pages 707-708 of the Burnshine case.
In my opinion, it is not the function of this Court, under the
Bill of Rights, to prevent the operation of a federal enactment,
designed for this purpose, on the ground that it applies only to
one class of persons, or to a particular area.
The words used by Laskin J. in a slightly different context, in
Curr v. The Queen, supra, at p. 899, may have application
here. He was considering the extent to which this Court might,
under s. 1(a) of the Bill of Rights, the "due process of law"
provision, have power to control substantive federal legislation.
He said, on the assumption that such power might exist,
... compelling reasons ought to be advanced to justify the
Court in this case to employ a statutory (as contrasted with a
constitutional) jurisdiction to deny operative effect to a
substantive measure duly enacted by a Parliament constitu
tionally competent to do so, and exercising its powers in
accordance with the tenets of responsible government, which
underlie the discharge of legislative authority under the
British North America Act.
In my opinion, in order to succeed in the present case, it
would be necessary for the respondent, at least, to satisfy this
Court that, in enacting s. 150, Parliament was not seeking to
achieve a valid federal objective. This was not established or
sought to be established.
The test of a valid federal objective was one
which was employed by the Supreme Court in
both the Hal case (supra) and the MacKay case
(supra). Counsel for the defendants seemed to
argue that meeting this test required no more than
the Diceyan concept of "equality before the law"
as it has been described above by Mr. Justice
Ritchie in the Lavell case, or no more than the
general constitutional tests required by sections 91
and 92 of the Constitution Act, 1867 (30 & 31
Vict., c. 3 (U.K.) [R.S.C. 1970, Appendix II, No.
5], as am. by Canada Act 1982, 1982, c. 11
(U.K.), Schedule to the Constitution Act, 1982,
Item 1). Whatever that test requires, it certainly is
not equivalent to those two concepts. As noted
above, the jurisprudence, the decision of the
Supreme Court in the Drybones case (supra) and
particularly the decision of Mr. Justice Martland
in the Burnshine case, indicates that it is an addi
tional branch and not equivalent to the Diceyan
requirements of "equality before the law". If it
were to mean no more than valid in accordance
with sections 91 and 92 of the Constitution Act,
1867 then the Supreme Court would be saying
that this section of the Bill of Rights was designed
to play the same role as the Constitution Act,
1867. Obviously, it could not have been intended
that it would only play such a duplicative role.
Some guidance as to what is meant by the
jurisprudence in this context by the phrase "valid
federal objective" may be gleaned from the judg
ment of Mr. Justice Martland in the Burnshine
case (supra) at page 707. In that context he seems
to be saying that while separate treatment for a
group of persons, either on the basis of age or
physical location, will not offend paragraph 1(b) of
the Canadian Bill of Rights, such separate treat
ment might do so if there were "compelling rea
sons" to convince a Court that the separate treat
ment was harsher than that accorded generally
under the law and that such treatment was not
validly justified (i.e. did not constitute a valid
federal objective). The origin of this test can be
seen in the decision of Mr. Justice Ritchie in the
Drybones case (supra) at page 297. It flows also
from the Court's decision in Burnshine where it
was held that the legislation in question, although
it treated individuals under the age of 22 different
ly, was designed to seek to reform and benefit
those individuals. It is a conclusion which equally
seems to follow from the majority decision in
MacKay (supra). In that case different treatment
respecting military personnel under military law
and before military tribunals was in issue. Mr.
Justice Ritchie at page 398 said:
The necessity of recognizing that a separate code of law
administered within the services is an essential ingredient of
service life has been appreciated since the earliest days....
and then at page 400:
It will therefore be seen, as I have said, that the National
Defence Act is dealing with a particular class of individuals
and, as it is enacted for the purpose of achieving a valid federal
objective, the provisions of s. 1(b) of the Bill of Rights do not
require that its provisions contain the same requirements as all
other federal legislation.
In my view, Mr. Justice McIntyre, at page 407,
is saying essentially the same thing in different
words, albeit in applying a stricter test.
I would be of the opinion, however, that as a minimum it would
be necessary to inquire whether any inequality has been created
for a valid federal constitutional objective, whether it has been
created rationally in the sense that it is not arbitrary or
capricious and not based upon any ulterior motive or motives
offensive to the provisions of the Canadian Bill of Rights, and
whether it is a necessary departure from the general principle
of universal application of the law for the attainment of some
necessary and desirable social objective. Inequalities created for
such purposes may well be acceptable under the Canadian Bill
of Rights.
Is the Restraint Act then enacted for a valid
federal objective as that term has been used in the
jurisprudence? Counsel argues that it is particular
ly capricious because it is the employer who is
limiting the rights of the public servants to wage
rises, including those already agreed upon. In my
view, however, it is particularly this feature which
renders the legislation valid. I could accept that
restraint legislation which limited wage rises by
'all blue-eyed people' or 'all nurses' or any other
group of society arbitrarily selected and whose
wages were not shown to be a particularly signifi
cant cause of inflation would not meet the test of a
valid federal objective. However, in the instant
case the government is really legislating as
employer. It is not appreciably different from an
employer who says to his employees that despite
negotiated contracts the economic situation is such
that all must take wage reductions or the company
will fold. The government, of course, is not likely
to go bankrupt. It is this that places public ser
vants in a greater position of security than the
work force as a whole, and indeed may place
public service unions in a stronger bargaining posi
tion. In any event, while it is not free from doubt, I
would hold that employer-employee relationship
between the government and those challenging the
Restraint Act in this case is such as to constitute a
sufficient nexus or justification to meet the test of
a valid federal objective in the sense that that
phrase has been used in the jurisprudence.
Accordingly, for the reasons given, the action is
dismissed.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.