June 20, 2025 marks the day that Bill C-58, An Act to amend the Canada Labour Code (“Code”) and the Canada Industrial Relations Board Regulations (“Bill C-58”),  comes into force.  The Bill, which received royal assent on June 20, 2024, introduces very significant changes to federal labour law in Canada including, most notably, a ban on the use of replacement workers during a strike or lockout.

It should be emphasized that the changes in Bill C-58 apply only to employers who are federally regulated. Examples of such employers are airlines, railways, telecoms and shipping companies. It will not apply to employers who are governed by provincial legislation.

The Bill introduces the following changes:

1. It amends the Code to remove the right of an employer to use replacement workers during a strike or lockout;
2. While generally prohibiting the use of replacement workers, it does allow for the limited use of managers and contractors to perform bargaining unit work during a strike or lockout
3. It imposes fines for each day of an offence committed;
4. It allows the Governor in Council to make regulations establishing monetary penalty schemes to promote compliance;
5. It strengthens the procedural requirements that require an employer and a union to determine what services and operations are necessary to continue during a strike or lockout.

Replacement Workers

Prior to June 20, 2025, the Code only prohibited the use of replacement workers where the employer’s intent was to undermine a trade union’s representational capacity.   Otherwise, the use of replacement workers was permitted.  Bill C-58 marks a dramatic change. Going forward, the following rules will apply:

(a)  Bargaining unit employees will not be allowed to work during any strike or lockout that involves “the cessation of work by all employees in the bargaining unit”, except if they are required to do so for purposes of maintenance of activities or if it is necessary due to a serious threat to the employer’s business or the life, health or safety of any person.  This effectively means that bargaining unit employees will be prohibited from making the decision to cross the picket line and return to their jobs during a full blown strike or lockout.

(b)  No employer will be permitted to have bargaining unit work performed by any excluded employee, (i.e. manager or confidential employee) who was hired after the day on which notice to bargain was given. Having bargaining unit work performed by excluded employees will continue to be permitted so long as those excluded employees were hired before notice to bargain was given and they are performing work only at their “normal workplace”.

(c) Contractors and employees of another employer will also be prohibited from performing bargaining unit work during a strike or lockout.  However, there is one clear exception.  If the employer was using the services of a contractor or another employer’s employee before notice to bargain was given, then those contractors/employees will be able to continue performing those services during the strike or lockout “so long as they do so in the same manner, to the same extent and in the same circumstances as they did before the notice was given”.

Penalties

Bill C-58 imposes a fine of up to $100,000 for each day an offence in respect of replacement workers is committed or continued. It also allows for the Governor in Council to make regulations establishing an administrative monetary penalty scheme to promote compliance with the provisions on replacement workers.

Maintenance of Activities

Section 87.4 of the Code requires an employer, trade union, and employees in a bargaining unit to continue supplying services to the extent necessary to prevent an immediate and serious danger to the safety or health of the public.

Bill C-58 will amend section 87.4(2) of the Code to require an employer and union to reach an agreement on maintenance of activities no later than 15 days after notice to bargain has been given.  Once reached, the parties must file a copy with the Minister and the Canada Industrial Relations Board (“CIRB”). If the parties fail to reach such an agreement within 15 days, either party may apply to the CIRB to have outstanding issues resolved and the CIRB is required to issue a decision within 90 days of receiving the application.

Prepared with the assistance of Mathews Dinsdale summer student Bernardo Calazans.

If you have any questions about this topic or any other questions relating to workplace law, please do not hesitate to contact a Mathews Dinsdale Lawyer.