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Labour Arbitrators Have Sole Jurisdiction over Human Rights Claims by Unionized Employees says the Supreme Court of Canada

On October 22, 2021, the Supreme Court of Canada (“SCC”) released its decision in Northern Regional Health Authority v Horrocks, 2021 SCC 42  , finding that labour arbitrators have sole jurisdiction over issues arising from  collective agreements, including claims brought under provincial human rights legislation. In a decision that will provide much-needed clarity to employers across the country, the SCC held that the Manitoba Human Rights Commission (“the Commission”) did not have jurisdiction to hear a human rights complaint by a unionized employee.

In Horrocks, the Employee was suspended for attending work under the influence of alcohol. She disclosed an alcohol addiction but refused to enter into a “last chance agreement” that required her to abstain from alcohol and engage in a treatment program. As a result, the Employer terminated her employment. The Union grieved the termination, and the Employee was reinstated on a last chance agreement. Shortly after, she breached the terms of the agreement and was terminated once again. This time, she brought a complaint before the Commission alleging discrimination contrary to the Manitoba Human Rights Code.

The SCC has previously held that where the “essential character” of the dispute arises from a collective agreement, a labour arbitrator has sole jurisdiction over the dispute, even if the facts could give rise to other legal claims based in statute or common law. The Commission acknowledged this rule but found that the essential character of the dispute was an alleged human rights violation, and therefore the complaint was properly under the Commission’s jurisdiction.

The Commission’s jurisdiction decision was set aside on judicial review, which concluded that the essential character of the dispute was whether or not there was just cause to terminate the Employee’s employment, which fell under the collective agreement. The Court of Appeal allowed the Employee’s appeal and held that, while dispute involving unionized workers typically lie within the exclusive jurisdiction of labour arbitrators, the Commission in this case had jurisdiction to hear the complaint.

The SCC provided much needed clarification. First, the Court noted that The Labour Relations Act in Manitoba contained a mandatory dispute resolution clause (the language of which is substantially similar to the dispute resolution clauses in other provincial labour relations statutes), which granted sole jurisdiction to a labour arbitrator over all disputes arising from the collective agreement. The SCC held that where labour legislation provides for the final settlement of disputes arising from a collective agreement, the jurisdiction of the decision-maker empowered by that legislation is final. While the SCC recognized that other statutes might “carve into” that jurisdiction, express language is required in order to grant concurrent jurisdiction. The language in the Human Rights Code in Manitoba was not sufficiently clear to rebut an arbitrator’s sole jurisdiction to hear labour disputes.  

The SCC went on to find that the essential character of the dispute must be determined to decide whether the facts giving rise to the dispute fall within the collective agreement. In this case, the SCC disagreed with the Commission’s characterization of the dispute as a “human rights violation”. Instead, they found it related to the Employer’s response to the Employee’s attendance at work under the influence of alcohol and the termination that followed. The essential character was the Employer exercising its management rights, which expressly allowed them to maintain quality patient care through discipline where warranted. Since this dispute fell within the collective agreement, the labour arbitrator had sole jurisdiction.

This decision provides welcomed clarity on the jurisdictional battle that had been taking place between human rights commissions and labour arbitrators for decades. Unionized employers should seek some comfort in knowing that claims brought by employees where the “central character” of the claim falls within the collective agreement can only be determined in one forum – a labour arbitration.

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.  

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