BCTF: A New Labour Law Duty to Consult in Good Faith

Last November, the Supreme Court released one of its most anticipated cases in labour law, British Columbia Teachers’ Federation v British Columbia, 2016 SCC 49, also known as “BCTF.” In a surprising move, the Supreme Court delivered its judgment orally from the bench. The majority of the Supreme Court stated that they agree with Justice Donald, who was the minority dissenting opinion in the lower court decision (2015 BCCA 184). After 14 years of conflict with the BC government, the BC Teacher’s Union won the case. The teacher’s “Working Conditions” clause, which governs items like class size and composition, teacher ratios and work load, was retroactively reinstated to 2002. But this case’s significance extends beyond the considerable impact on a large public service in British Columbia: In BCTF, the Supreme Court adopted an interpretation of the section 2(d) right to freedom of association in a way that mandates a duty to consult in good faith. While the duty to consult has been a central consideration in Aboriginal law, it was not previously a feature of labour law in Canada. Hopefully, this new duty will scale-back the government’s recent trend of unilaterally implementing legislation without consulting unions or the people the legislation impacts.

Summary of the Facts

The BC Court of Appeal decision is a whopping 119 pages, yet it only contains a half page summary. We may speculate that part of the reason for the summary’s extreme brevity is that the characterization of what happened in the case differs considerably between the majority and minority views. Below is a summary of the findings by the trial judge, which was deferred to by Justice Donald and the Supreme Court of Canada.

The issues in this case date back to 2002, when the British Columbia government unilaterally nullified hundreds of terms from collective agreements with public services through multiple Bills. The unilateral nullification in the medical sector was deemed unconstitutional in BC Health Services, 2007 SCC 27, yet still the BC government refused to settle the dispute with the province’s teachers. The main impact on the teachers was the wholesale removal of their “Working Conditions” clause, which was obtained through previous collective bargaining at the expense of other terms. Bill 28 permanently barred any negotiation on these changes. The union was given no advance notice of the legislation nor did the province consult with the union.

After Bill 28 was declared unconstitutional in a different Charter challenge, the government repealed it and replaced it with Bill 22, after a period of sham bargaining with the teacher’s union, BCTF. Bill 22 was essentially the same as Bill 28 but it made the ban on collective bargaining temporary. The government dismissed the removed Working Conditions as being inflexible but failed to elaborate when requested. In short, the government took a firm position and was not open to compromise. The government did not even read the BCTF’s proposal until 5 months after it was submitted to them From the beginning, the government intended to re-enact the same provisions already found to be unconstitutional after a period of delay. I believe the trial judge, Justice Donald and the SCC correctly interpreted the failure of the government to consider any representations from the other side as bad faith conduct.

Lower Court Decisions (Trial Judge and British Columbia Court of Appeal)

The trial judge implemented a two part test. She looked at: 1) the importance of the matter to the union; and 2) whether the change impacted the right to negotiate. Ultimately, she found that the government had not consulted in good faith because they came into the process with a closed mind. She also found that the government acted in bad faith by trying to provoke the teachers to go on strike to justify their legislation. Ultimately, she awarded $2 million in punitive-like damages under section 21. In contrast, both the Supreme Court and Justice Donald did not believe punitive damages were appropriate based on court dialogue theory, which maintains that the government should not be penalized for trying to legislatively respond to findings of unconstitutionality. Instead, the final result dictated that the collective agreement be restored and retroactively applied back to 2002. This is an extremely costly decision, as many grievances have been filed since that time.

The majority of the BC Court of Appeal (overturned by the SCC) disagreed with the trial judge’s findings. The majority agreed that consultations must be conducted in good faith, however, they said: 1) the trial judge made an error by looking into the government’s motivations; 2) all the province needed to prove was an adequate process; and 3) the provoking of a strike was to increase bargaining pressure.

In the minority view, Justice Donald found that the trial judge did engage in a contextual analysis— she did not focus on a single action but 13 years of systematic oppression of section 2(d) rights. He found it outrageous that the government was found to have unconstitutional legislation and think it could correct Charter breaches by superficially consulting a union and then re-enacting the same legislation.

Most importantly, Justice Donald found that it was not a legal error to assess the reasonableness of proposals and positions of the parties. Drawing largely from Fraser, 2011 SCC 20, and BC Health Services, Justice Donald stated that proposals cannot be inflexible and the consultations must be meaningful. Ultimately, the Charter breach is not the legislation itself but the lack of consultation.

Justice Donald gave three major reasons why it is appropriate to evaluate the substance of proposals. First, the evaluation of the Labour Relations Code incorporates a Wagnerian model of labour relations, which is different than a good faith analysis under a constitutional perspective. The government cannot legally rely on an impasse if they have adopted an unwavering, unreasonable position that lacks good faith. Secondly, a “hand off” approach fails to evaluate illegal proposals or those against government policies. Lastly, failing to probe the substantive position of government would undermine the Oakes test, which analyzes whether or not there is a rational connection between the policy and its purported purpose. If the court is forced to take the government for its word, it would never reach the stage of deciphering whether an alternative was actually possible.

Additionally, Justice Donald did not find the implementation of the “Learning Improvement Fund” or the Class Size and Compensation Regulation to be a sufficient government remedy, as the structure severely diluted the power of BCTF and asked them to agree to give away their constitutional rights. Perhaps the most revealing quote in this case comes from Justice Donald when he states that “passing helpful legislation unconstitutionally is still passing legislation unconstitutionally (para 371).”

Legal Implications

This decision essentially deems collective bargain to be, or necessarily involve, consultation in good faith. Freedom of association is not breached if the other side is given an opportunity to meaningfully influence changes, on equal bargaining terms, prior to a unilateral change (BCTF, para 287). Approximate equality in bargaining was drawn from an interpretation of the Saskatchewan Federation of Labour case, 2015 SCC 4, on the right to strike (to restore bargaining equality). While it was noted in this case that the government was in a stronger position, the court did not significantly or explicitly rely on this inequality. It will be interesting to see how equality between bargaining parties develops in labour law as the strength of unions continues to decline in an era of globalization.

Bill 22 passed the pressing and substantial objective and rationally connected stages of the Oakes test section 1 analysis. The legislation failed at the minimal impairment stage. I think it’s important that this case recognized that the effect of adopting unconstitutional legislation can extend even after rights are re-instated. Even though the prohibition on bargaining was changed to be temporary, it still forced the BCTF to start negotiations from scratch and negotiate for rights they had already won in a previous bargaining process. The court lambasted the government for ignoring that the Working Conditions were open-ended and accounted for different circumstances. It seems like the courts will be more likely to protect collective bargaining provisions that are flexible. In a way, this factors into an implicit analysis of whether the government’s position is “reasonable.” The result may very well have been different if the Working Conditions contained hard-lined, numerical limits.

Given this result, emergency legislation, in circumstances where there is no time to consult, would violate section 2(d) but likely be upheld under section 1. It is important to leave policy balancing out of Charter breach determination and leave exigencies to section 1 balancing.

Some elements from previous cases were also clarified. This case reaffirms that section 2(d) does not protect a particular outcome of collective bargaining, it protects the process. Freedom of association was defined in this case as the “right of employees to associate in pursuit of workplace goals and to a meaningful process within which to achieve these goals.” The substantial interference test was also upheld, meaning that section 2(d) is only breached if government legislation or actions substantially interfere with collective bargaining.

Democracy stems from a notion of public consultation. I am happy to see that the law has adopted this premise for the government’s dealings with unions that represent the very institutions that act to support the citizenry under the government.