A-206-90
Attorney General of Canada (Applicant)
v.
Public Service Alliance of Canada (Respondent)
INDEXED AS: CANADA (ATTORNEY GENERAL) V. PUBLIC SER
VICE ALLIANCE OF CANADA (CA.)
Court of Appeal, Pratte, Heald and Mahoney
JJ.A.—Ottawa, October 23 and November 27,
1990.
Public Service — Jurisdiction — Whether PSSRB having
jurisdiction to entertain reference pursuant to PSSRA, s. 99
concerning contracting out of data capture function resulting
in loss of employment for indeterminate employees — Board
ruling Work Force Adjustment Policy and collective agree
ment violated S. 99 permitting reference to enforce obliga
tion arising out of collective agreement when not obligation
"enforcement of which may be the subject of a grievance of an
employee in the bargaining unit to which the agreement ...
applies" — Employee right to grieve provided in s. 91
Whether obligations arising out of collective agreement
enforceable by individual — Whether obligations enforceable
by union or employer mutually exclusive — Discussion of
policy grievance".
Public Service — Labour relations — Government policy to
substantially reduce size of Public Service — Collective agree
ment incorporating Work Force Adjustment Policy whereby
employer to review and terminate contracting out to facilitate
redeployment of indeterminate employees whose services no
longer required because of lack of work or discontinuance of
function — Inconsistent with creation of surplus or laid-off
personnel by contracting out jobs that they have been doing —
PSSRB correctly declaring violation of Policy and collective
agreement.
This was an application to set aside a declaration of the
Public Service Staff Relations Board on a reference pursuant to
Public Service Staff Relations Act, section 99. The collective
agreement between Treasury Board and the respondent (which
represented data processors employed by the Department of
National Revenue, Customs and Excise) incorporated the
Work Force Adjustment Policy, which provided for the rede
ployment and retraining of indeterminate employees laid off
pursuant to Public Service Employment Act, section 29. In
1985, after the Government announced its decision to reduce
the size of the Public Service, the Department began contract
ing out the work done by data capture employees. The Board
held that this contracting out violated the Work Force Adjust
ment Policy, and therefore the collective agreement. It held
that the grievance was a policy, rather than an individual
grievance and as such belonged to the bargaining agent. The
issues were whether the Board had jurisdiction to deal with the
reference, and if so, whether it erred in law in concluding as it
did. Section 99 provides that a reference may be made to the
Board to enforce an obligation arising out of a collective
agreement provided that it "is not one the enforcement of
which may be the subject of a grievance of an employee in the
bargaining unit to which the agreement ... applies". The
applicant's submission was that the question could not be
referred to the Board because it related to an obligation the
enforcement of which might be the subject of grievances by
employees. The respondent argued that it was attempting to
enforce the employer's obligation not to contract out work done
by its employees, an obligation which was owed to the union
rather than to the employees and which could only be enforced
by the union. Subsection 91(1) gives an employee the right to
grieve the interpretation or application of a collective
agreement.
Held (Pratte J.A. dissenting): the application should be
dismissed.
Per Mahoney J.A. (Heald J.A. concurring): The Board had
jurisdiction to deal with the issue in the reference. Use of the
term "policy grievance" was unfortunate as that term is not
known to the Act. Unlike cases where there was unilateral
adoption of a policy which might breach the rights of an
employee under the collective agreement, the policy herein was
mutually agreed to and the dispute did not concern its applica
tion to individual employees but rather the right of the employ
er to contract out services performed by members of the
bargaining unit. The issue went beyond the obligation owed to
an individual employee and had to do with the very existence
and raison d'être of the bargaining agent. It has been recog
nized that some questions might be subject of individual griev
ance or reference. The nature of the relief sought is relevant to
whether the proceeding should be characterized as being the
enforcement of an obligation "which may be the subject of a
grievance of an employee". Some of the affected employees,
certainly some who were laid off, probably had a right person
ally to grieve on the basis of the alleged obligation not to
contract out.
The Board correctly held that the employer's conduct was
contrary to both the letter and spirit of the Work Force
Adjustment Policy. The Policy does not prohibit contracting
out but contemplates that, to facilitate redeployment of "affect-
ed", "surplus", or "laid-off" personnel, the employer will
review and terminate its use of contracted services. That
requirement is inconsistent with the creation of "affected",
"surplus", or "laid-off' personnel, by contracting out the very
jobs that they have been doing. By definition, a "Work Force
Adjustment" occurs when management decides that indetermi
nate employees will no longer be required because of "lack of
work" or a "discontinuance of a function". The services of an
employee whose job has been contracted out are not required
only because the job has been contracted out, not because of
lack of work or the discontinuance of a function. The work
remains to be done and the function continues.
Per Pratte J.A. (dissenting): The matter referred to the
.Board could not be the subject of a reference under section 99.
Sections 91 and 99 distinguish two kinds of obligations that
may arise out of collective agreements: those that may be
enforced by an individual employee filing a grievance and those
that may be enforced by the union or employer by way of
reference. The two classes of obligations are mutually exclusive.
To classify such obligations it must be determined in whose
favour each one is stipulated. The obligation sought to be
enforced was not to contract out services so as to cause
prejudice to indeterminate employees. It was for the benefit of
those employees who alone are entitled to grieve if the employer
violates that undertaking.
STATUTES AND REGULATIONS JUDICIALLY
CONSIDERED
Federal Court Act, R.S.C., 1985, c. F-7, s. 28.
Public Service Employment Act, R.S.C., 1985, c. P-33,
s. 29.
Public Service Staff Relations Act, R.S.C. 1970, c. P-35
(as am. by S.C. 1974-75-76, c. 67, s: 27), s. 98. '
Public Service Staff Relations Act, R.S.C., 1985, c. P-35,
ss. 91(1), 99.
CASES JUDICIALLY CONSIDERED
APPLIED:
Canadian Air Traffic Control Association v. The Queen,
[1985] 2 F.C. 84; (1985), 85 CLLC, 14,106; 57 N.R. 351
(C.A.). ,
DISTINGUISHED:
Professional Institute of the Public Service v. Canada,
A-64-90, Hugessen J.A., judgment dated 27/9/90,
F.C.A., not yet reported.
CONSIDERED:
Queen (The) v. Lavoie, [1978] 1 F.C. 778; (1977), 18
N.R. 521 (C.A.).
REFERRED TO:
American Farm Bureau Federation v. Canadian Import
Tribunal [National Corn Growers Assn. v. Canada
(Import Tribunal)], [1990] 2 S.C.R. 1324; Gloin v.
Attorney General of Canada, [1978] 2 F.C. 307; (1977),
20 N.R. 475 (C.A.).
COUNSEL:
Harvey A. Newman and Ronald N. Snyder
for applicant.
Andrew J. Raven and Dianne Nicholas for
respondent.
SOLICITORS:
Deputy Attorney General of Canada for
applicant.
Soloway, Wright, Ottawa, for respondent.
The following are the reasons for judgment
rendered in English by
PRATTE J.A. (dissenting): This section 28 [Fed-
eral Court Act, R.S.C., 1985, c. F-7] application
seeks to set aside a decision of the Public Service
Staff Relations Board on a reference made by the
respondent pursuant to section 98 [R.S.C. 1970, c.
P-35 (as am. by S.C. 1974-75-76, c. 67, s. 27)]
(now section 99) of the Public Service Staff Rela
tions Act [R.S.C., 1985, c. P-35].'
The respondent was the bargaining agent for all
employees of the Treasury Board in the Data
Processing (DA) bargaining unit, a bargaining
unit that included the employees performing data
capture functions for the Department of National
Revenue, Customs and Excise. The respondent and
Treasury Board entered into a collective agree
ment in respect of that bargaining unit for a period
ending on June 30, 1988, which contained a clause
(article M-37.03(28)) providing that the "Work
' This section reads thus:
99. (1) Where the employer and a bargaining agent have
executed a collective agreement or are bound by an arbitral
award and the employer or the bargaining agent seeks to
enforce an obligation that is alleged to arise out of the
agreement or award, and the obligation, if any, is not one the
enforcement of which may be the subject of a grievance of an
employee in the bargaining unit to which the agreement or
award applies, either the employer or the bargaining agent
may, in the prescribed manner, refer the matter to the Board.
(2) Where a matter is referred to the Board pursuant to
subsection (1), the Board shall hear and determine whether
there is an obligation as alleged and whether, if there is,
there has been a failure to observe or to carry out the
obligation.
(3) The Board shall hear and determine any matter
referred to it pursuant to subsection (1) as though the matter
were a grievance, and subsection 96(2) and sections 97 and
98 apply to the hearing and determination of that matter.
Force Adjustment Policy" approved by Treasury
Board was to form part of the collective agree
ment. That policy is, in effect, a set of directives to
be applied by the various departments, the Trea
sury Board and the Public Service Commission for
the purpose of ensuring that indeterminate
employees in the Public Service that are laid off
pursuant to section 29 of the Public Service
Employment Act [R.S.C., 1985, c. P-33] 2 are
treated fairly and are given a reasonable opportu
nity to continue their careers by being redeployed
in other positions in the Public Service.
In 1985, after the Government had announced
its decision to decrease the size of the Public
Service by some 15,000 person years within the
next five years, the Department of National Reve
nue notified its employees that, in accordance with
that policy, it intended to reduce its personnel by
contracting out the work done by its data capture
employees who, as a consequence, would have to
be laid off pursuant to section 29 of the Public
Service Employment Act. Early in 1987, the
Department entered into a contract with an
independent contractor, Automation Centre of
Ottawa Ltd., which agreed to perform the work
then done by the data capture employees of the
Department. At the end of 1987, the contractor's
employees had replaced those of the Department,
the vast majority of whom had been redeployed to
other positions in the Public Service.
On December 22, 1988, the respondent filed a
reference pursuant to what is now section 99 of the
2 That provision reads as follows:
29. (1) Where the services of an employee are no longer
required because of lack of work or because of the discon
tinuance of a function, the deputy head, in accordance with
the regulations of the Commission, may lay off the employee.
(2) An employee ceases to be an employee when the
employee is laid off pursuant to subsection (1).
(3) Notwithstanding anything in this Act, the Commis
sion shall, within such period and in such order as it may
determine, consider a lay-off for appointment, without com
petition and, subject to sections 30 and 39, in priority to all
other persons, to any position in the Public Service for which,
in the: opinion of the Commission, the lay-off is qualified.
(4) Notwithstanding subsection (2), a lay-off is entitled,
during such period as the Commission may determine for
any case or class of cases, to enter any competition for which
the lay-off would have been eligible had he not been laid off.
Public Service Staff Relations Act alleging that
the Department, in contracting out the work done
by its data capture employees, had contravened the
Work Force Adjustment Policy. It was the
respondent's contention that, under the policy, the
Department was prohibited from contracting out
its services if such action resulted in indeterminate
employees being "affected", "surplus" or "laid
off" within the meaning of the policy.'
The applicant first raised a preliminary objec
tion to that reference and argued that the Board
had no jurisdiction in the matter since the question
referred to the Board by the respondent could not,
under section 99, be the subject of a reference.
That objection was dismissed by the Board in a
decision dated June 23, 1989. In its final decision,
pronounced on March 13, 1990, the Board ruled in
favour of the respondent: it determined and
declared that, in contracting out the work done by
its data capture employees, the Department had
violated the Work Force Adjustment Policy and,
thereby, the collective agreement.
The applicant attacks this decision on two
grounds, namely, that the Board had no jurisdic
tion in the matter and that, in any event, the
decision under attack is founded on a misinterpre
tation of the Work Force Adjustment Policy.
3 The policy defines these expressions as follows:
AFFECTED EMPLOYEES: Indeterminate employees whose ser
vices will no longer be required because of WORK FORCE
ADJUSTMENT situations.
WORK FORCE ADJUSTMENT: A situation which occurs when
a deputy head or DELEGATED OFFICER decides that the
services of one or more indeterminate employees will no
longer be required beyond a specified date because of lack of
work or because of the discontinuance of a function ....
SURPLUS EMPLOYEE: An indeterminate employee who has
been declared surplus.
SURPLUS PRIORITY: An administrative priority accorded by
the PSC to 'SURPLUS EMPLOYEES to permit them to be
appointed to other positions in the Public Service without
competition or right of appeal.
LAY-OFF: Termination of employment under Section 29 of
the Public Service Employment Act.
The applicant's jurisdictional argument is based
on subsection 99(1) of the Public Service Staff
Relations Act which clearly provides that a refer
ence may be made to the Board for the purpose of
enforcing an obligation arising out of a collective
agreement only when the obligation in question "is
not one the enforcement of which may be the
subject of a grievance of an employee in the
bargaining unit to which the agreement ...
applies". In this case, says the applicant, the ques
tion that the respondent referred to the Board
could not be the subject of a reference because it
related to an obligation the enforcement of which
might be the subject of grievances by the
employees concerned. The position of the respond
ent on this point is that, by its reference, it was
seeking to enforce the employer's obligation not to
contract out work done by its employees, an obli
gation which was owed to the union rather than to
the employees and which, as a consequence, could
only be enforced by the union itself. Moreover,
according to the respondent, many of the
employees concerned in this case might not have
filed grievances since, having ceased to be
employees, they had thereby lost the right to
grieve.
Under subsection 99(1), a reference may be
made to the Board for the purpose of enforcing an
obligation arising out of a collective agreement
provided that obligation "is not one the enforce
ment of which may be the subject of a grievance of
an employee". On the other hand, subsection 91(1)
gives the right to file a grievance to the employee
who feels aggrieved by the interpretation or
application, in his respect, of the collective agree
ment. These provisions make a clear distinction
between two kinds of obligations that may arise
out of collective agreements: those that may be
enforced at the suit of an individual employee by
filing a grievance and those that may be enforced
at the request of the union or the employer by way
of reference under subsection 99(1). These two
classes of obligations are mutually exclusive since,
under subsection 99(1), the enforcement of an
obligation may not be the subject of a reference if
it may be the subject of a grievance. All the
obligations arising out of a collective agreement
must, therefore, be classified in one or the other of
these two categories. Common sense requires that
this classification be made by determining in
whose favour each one of those obligations is
stipulated.
In order to resolve the "jurisdictional" question
raised by the applicant, it is therefore necessary to
specify the, real nature of the obligation that the
respondent was seeking to enforce by its reference
since,, without knowing what that obligation was, it
is impossible to. say whether it was stipulated in
favour of the union or the individual employees.
That obligation was allegedly created by section
5.1. of the Work Force Adjustment Policy. That
section enumerates the responsibilities of the
Department in a work force adjustment situation:
5.1 Departments shall:
5.1.2 review their use of employees appointed for specified
periods (term employees) and their use of contracted services
and should terminate them where such action would facili
tate the REDEPLOYMENT of AFFECTED EMPLOYEES, SUR
PLUS EMPLOYEES, OR LAID-OFF PERSONS;
The respondent reads this clause as imposing on
the departments the firm obligation, in a "work
force adjustment situation", to terminate contract
for services when this action would facilitate the
redeployment of "affected employees", "surplus
employees" or. "laid-off persons". It logically fol
lows, according to the respondent, that the depart
ments also have the obligation not to contract out
services if, as a result of the contracting out, a
work force adjustment situation would be created
necessitating the redeployment of indeterminate
employees. Otherwise, a department would have,
on the one hand, the right, to contract out services
so as to create a work force adjustment situation
and, on the other hand, the obligation to terminate
the contract creating that situation.
If the obligation' here in question were merely
the employer's obligation not to contract out any
services, it would clearly be an obligation stipulat
ed in favour of the union since it would be impos
sible to determine who, among the employees,
could be the beneficiary of such a promise. But
such is' not the situation. The obligation that the
respondent is seeking to enforce, assuming its
existence, is the obligation ' not to contract out
services so as to cause prejudice to indeterminate
employees. That obligation was clearly incurred
for the sole benefit of those employees. It is there
fore normal that these employees, and only they,
be entitled to grieve if the employer violates that
undertaking.
The respondent's argument that many of the
employees affected by the contracting out would
not be entitled to grieve because they ceased, as a
consequence of the contracting out, to be
employees, has, in my view, no merit. It is now
established that an employee cannot be deprived of
the right to grieve by a lay-off. 4
I am therefore of opinion that the matter that
the respondent referred to the Board could not be
the subject of a reference under subsection 99(1)
of the Public Service Staff Relations Act.
I would set aside the decision under attack.
* * *
The following are the reasons for judgment
rendered in English by
MAHONEY J.A.: I have had the opportunity to
read in draft the reasons for judgment prepared by
my brother Pratte. I find myself in respectful
disagreement.
This section 28 application is brought in respect
of a decision of the Public Service Staff Relations
Board made on a reference under section 99 of the
Public Service Staff Relations Act, R.S.C., 1985,
c. P-35. The issues are, firstly, whether the Board
had jurisdiction to deal with the reference at all
and, secondly, if so, whether it erred in law in
concluding that the employer had violated the
collective agreement by contracting out certain
functions theretofore performed by members of
the bargaining unit. The background facts are not
in dispute.
On November 4, 1984, the Government of
Canada announced a policy objective of reducing
4 See: Queen (The) v. Lavoie, [1978] 1 F.C. 778 (C.A.), and
Gloin v. Attorney General of Canada, [1978] 2 F.C. 307
(C.A.).
the size of the Public Service. Effective April 18,
1985, the Work Force Adjustment Policy agreed
upon by the National Joint Council of the Public
Service was approved by Treasury Board. In his
May, 1985 budget, the Minister of Finance called
for a reduction of 15,000 person years from the
Public Service over a five—year period. The Work
Force Adjustment Policy was incorporated in a
Master Agreement between Treasury Board and
the Public Service Alliance of Canada with a
stated expiry date of June 30, 1988. The Master
Agreement formed part of the collective agree
ment governing the employment of data processors
employed by the Department of National Reve
nue, Customs and Excise, at all relevant times.
Among its initiatives to reduce person years, that
Department contracted out the work performed by
over 270 data processors employed at various loca
tions throughout Canada.
The Work Force Adjustment Policy contained
the following relevant provisions:
3. POLICY
It is the policy of the Treasury Board that indeterminate
employees whose services will no longer be required because
of lack of work or the discontinuance of a function and who
are suitable for an appointment shall, as far as is practicable,
be redeployed to positions in the Public Service which are or
which become vacant and for which they are qualified in the
opinion of the PSC or for which they would be able to qualify
with RETRAINING under specified conditions (see Section 8).
5.1.2 Departments shall review their use of employees
appointed for specified periods (term employees) and their
use of contracted services and should terminate them where
such action would facilitate the REDEPLOYMENT Of AFFECT
ED EMPLOYEES, SURPLUS EMPLOYEES, or LAID-OFF PER
SONS.
6.1 ... To minimize the impact of a MAJOR WORK FORCE
ADJUSTMENT situation on the AFFECTED EMPLOYEES, it is
imperative that a human resource plan be established as
early as possible ....
6.2 Factors to consider in developing a human resource plan
include, but are not restricted to, the following:
(d) placement possibilities through the termination of
specified period appointments and/or contracts for
services; 5
The policy sets forth, inter alia, the following definitions:
(Continued on next page)
Subsection 99(1) of the Public Service Staff
Relations Act provides:
99. (1) Where the employer and a bargaining agent have
executed a collective agreement or are bound by an arbitral
award and the employer or the bargaining agent seeks to
enforce an obligation that is alleged to arise out of the agree
ment or award, and the obligation, if any, is not one the
enforcement of which may be the subject of a grievance of an
employee in the bargaining unit to which the agreement or
award applies, either the employer or the bargaining agent
may, in the prescribed manner, refer the matter to the Board.
My emphasis. The provision must be read with
subsection 91(1), which vests an employee with the
right to grieve.
91. (1) Where any employee feels aggrieved
(a) by the interpretation or application, in respect of the
employee, of
(i) a provision of a statute, or of a regulation, by-law,
direction or other instrument made or issued by the
employer, dealing with terms and conditions of employ
ment, or
(ii) a provision of a collective agreement or an arbitral
award, or
(b) as a result of any occurrence or matter affecting the
terms and conditions of employment of the employee, other
than a provision described in subparagraph (a)(i) or (ii),
in respect of which no administrative procedure for redress is
provided in or under an Act of Parliament, the employee is
entitled, subject to subsection (2), to present the grievance at
each of the levels, up to and including the final level, in the
grievance process provided for by this Act.
(Continued from previous page)
AFFECTED EMPLOYEES: Indeterminate employees whose ser
vices will no longer be required because of WORK FORCE
ADJUSTMENT situations.
SURPLUS EMPLOYEE: An indeterminate employee who has
been declared surplus.
LAID-OFF PERSON: A person who has been laid-off pursuant
to subsection 29(1) of the Public Service Employment Act.
REDEPLOYMENT: The appointment of an AFFECTED
EMPLOYEE, a SURPLUS EMPLOYEE, or a LAID-OFF PERSON
to a position for which he or she is QUALIFIED.
WORK FORCE ADJUSTMENT: A situation which occurs when
a deputy head or DELEGATED OFFICER decides that the
services of one or more indeterminate employees will no
longer be required beyond a specified date because of lack of
work or because of a discontinuance of a function. A major
WORK FORCE ADJUSTMENT situation is one in which ten or
more indeterminate employees in a department, in one or
more locations, are affected at the same time.
The qualification of subsection 91(2) is not
pertinent.
The reference was stated in the following terms:
6. On the basis of [paragraphs 5.1.2 and 6.2(d)], the Appli
cant submits that the Respondent is prohibited from con
tracting out services if such action would result in affected,
surplus or laid off employees.
7. The above mentioned actions of the Respondent in con
tracting out the duties of the data capture section resulted in
several employees being "affected", "surplus" or "laid oft'
as contemplated by the Workforce Adjustment Policy.
8. The Applicant submits, therefore, that the Respondent
has acted in violation of the collective agreement and the
provisions of the Workforce Adjustment Policy by adopting a
course of action, that of contracting out data capture ser
vices, which has resulted in affected, surplus and laid off
employees.
Among the relief sought, and the only relief grant
ed, was a declaration that the contracting out of
the data capture function had violated the collec
tive agreement.
The evidence was that, of 278 affected
employees in the bargaining unit, 11 retired, 202
were redeployed, 56 took the cash-out option pro
vided for in the Work Force Adjustment Policy
and 9 were laid off; of the latter, 3 were laid off on
an accelerated basis at their own request and 3
were redeployed after lay-off. Some of those
employees had filed individual grievances pursuant
to subsection 91(1). A number of those were put in
evidence and were examined by the learned Vice-
Chairman, who made the following, uncontested,
finding of fact:
They are not precisely in connection with the above described
obligation relating to contracting services as defined in the
Policy. The employees merely say in their grievances that
they have been given little or no training or retraining as
provided in the policy or that they should not have been laid
off. The grievances have to do, as argued by counsel for the
bargaining agent, with the implementation of the policy and
not the act of contracting out itself.
He concluded:
My conclusion is that the problem here is of a general nature
and that the grievance here being definitely a policy griev
ance as against an individual grievance, it belongs to the
bargaining agent. The obligation was owed not to an
individual employee but rather to the employees as a whole
as represented by their bargaining agent. An employee may
not have asked for the enforcement of the employer's obliga
tion to "review the use of contracted services...". Such an
obligation goes beyond the obligation owed to an individual
employee and has to do with the bargaining agent and its
very existence and raison d'être.
His use of the term "policy grievance" may have
been unfortunate. In a subsequent decision of this
Court, 6 Hugessen J.A., observed [at page 2]:
Counsel described the grievance as a "policy grievance" but
that concept, however useful it may be, is not known to the Act.
On its plain meaning [subsection 99(1)] only allows a refer
ence to the Board where the alleged breach of obligation could
not be the subject of an individual grievance. In the present
case the collective agreement imposes certain obligations on the
employer to give vacations to its employees. Those obligations
may be enforced by the employees affected, and only by them.
There is not, as counsel suggested, some further obligation, to
be implied from the Collective Agreement, prohibiting the
employer from promulgating policies the application of which
the bargaining agent considers would breach the obligations
owed to the individual employees.
In my opinion, the present case is to be distin
guished on its facts from that. Here, there is no
question of the unilateral adoption of a policy
which, if applied, might breach the rights of an
individual employee under the collective agree
ment. Rather, we have a policy, agreed upon by
the employer and bargaining agent, and a dispute,
not as to its application in respect of an individual
employee as contemplated by subsection 91(1), but
as to its application to the right of the employer to
contract out the performance of services thereto-
fore performed by members of the bargaining unit.
I agree with the learned Vice-Chairman that the
issue "goes beyond the obligation owed to an
individual employee" and has to do with "the very
existence and raison d'être" of the bargaining
agent.
6 Professional Institute of the Public Service v. Canada, not
yet reported, decision rendered September 27, 1990, Court file
no. A-64-90 (P.S.S.R.B. file no. 169-2-480).
The jurisdictional issue appears not to have been
raised in Canadian Air Traffic Control Associa
tion v. The Queen, [1985] 2 F.C. 84 (C.A.), which
applied an earlier decision, Queen (The) v. Lavoie,
[1978] 1 F.C. 778 (C.A.). Lavoie involved an
individual grievance as to whether a former
employee had a right to grieve his dismissal.
CATCA was a reference concerned with the enti
tlement of former employees to the retroactive
benefits of a collective agreement concluded after
their termination. The decision did, nevertheless,
recognize that similar questions might be subject
of individual grievance or reference. Heald J.A.,
observed, at page 91:
While the section of the Act in question in Lavoie was
section [91], which confers the right to grieve personally upon
an "employee", whereas in the case at bar, the authority to
refer a matter to the Board is contained in section [99], the
subject matter in each case is very similar, namely, the matter
of an "employee" 's right to challenge a decision made affect
ing his entitlement to benefits arising out of his employment
relationship.
It seems to me that the nature of the relief
sought is relevant to whether or not the proceeding
should be characterized as being the enforcement
of an obligation "which may be the subject of a
grievance of an employee". In all likelihood, some
of the 278 affected employees, certainly some who
were laid off, had a right personally to grieve on
the basis of the alleged obligation not to contract
out. But what of those who had accepted the
cash-out option? The bargaining agent had lost
them as members as a direct result of the employ
er's alleged' failure to observe that obligation. In
my opinion, the Board had jurisdiction to deal with
the issue as raised in the reference, namely, wheth
er the provisions of the Work Force Adjustment
Policy gave rise to a general obligation on the part
of the employer not to contract out services if that
would result in affected, surplus or laid-off
employees.'
' In reaching this conclusion, I have not found it necessary to
consider American Farm Bureau Federation v. Canadian
Import Tribunal, a decision of the Supreme Court of Canada
(Continued on next page)
As to the substantive issue, the learned Vice-
Chairman, after reciting at length from the Work
Force Adjustment Policy and, in my view, correct
ly analyzing it, concluded:
The employer had an obligation under the Policy to review
and when possible terminate contracting out arrangements in
order to ensure the continued employment of indeterminate
employees within the Public Service. This it failed to do. It
set out to reduce the number of indeterminate employees and
contracted out the identical jobs being performed by the
employees in order to do so.
That conclusion is amply supported by the
evidence.
The entire thrust of the Work Force Adjustment
Policy is that, in a work force adjustment situa
tion, indeterminate employees whose services
would no longer be required would, as far as
practicable, be redeployed and, if necessary,
retrained. The Policy does not prohibit contracting
out but it does contemplate that, to facilitate
redeployment of "affected", "surplus" or "laid-
off" personnel, the employer will, inter alia, review
and terminate its use of contracted services. That
requirement is utterly inconsistent with an inten
tion to permit the creation of "affected", "surplus"
or "laid-off" personnel by contracting out the very
jobs that they have been doing. By definition, a
"Work Force Adjustment" occurs when manage
ment decides that one or more indeterminate
employees will no longer be required because of
"lack of work" or "a discontinuance of a func
tion". It cannot, in my view, be said that the
services of an employee whose job has been con
tracted out are not required because of lack of
work or the discontinuance of a function. That
employee is not required only because the job has
been contracted out. The work remains to be done
and the function continues. The Vice-Chairman
did not err in his determination that the employ-
(Continued from previous page)
rendered November 8, 1990, [National Corn Growers Assn. v.
Canada (Import Tribunal), [1990] 2 S.C.R. 1324] which was
not, of course, subject of argument. It is, nevertheless, an
emphatic reminder of the curial deference owed an "expert"
tribunal in the interpretation of its constituting legislation.
er's conduct was contrary to both the letter and
spirit of the Work Force Adjustment Policy.
I would dismiss this section 28 application.
HEALD J.A.: I agree.
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.