Northern Regional Health Authority v Horrocks: Exclusive vs. Concurrent Jurisdiction for Labour Arbitrators

In Northern Regional Health Authority v Horrocks, 2021 SCC 42 [Horrocks], the majority of the Supreme Court of Canada (“SCC”) held in a 6-1 decision that mandatory dispute resolution provisions under labour legislation confer exclusive jurisdiction to the designated decision-maker, usually a labour arbitrator. As a result, unionized employees will have little to no legal recourse outside of union grievance procedures if any disputes, including human rights claims, were to arise from their collective agreements.

Facts 

In 2011, Linda Horrocks, an employee of the North Regional Health Authority (“NRHA”), was suspended by her employer for coming to work while under the influence of alcohol. She eventually disclosed her alcohol addiction to her employer, and the NRHA subsequently asked her to enter into a “last chance agreement,” which required Ms. Horrocks to abstain from alcohol and engage in addiction treatment. When she refused to sign the agreement, the NRHA terminated her employment (Horrocks, para 2).

Ms. Horrocks’ union filed a grievance against the termination, and the parties resolved the dispute by agreeing that Ms. Horrocks would be reinstated if she agreed to terms that were substantially similar to those in the “last chance agreement.” Not long after, the NRHA alleged that she breached the terms of the agreement and terminated her employment again. In response, Ms. Horrocks filed a complaint with the Manitoba Human Rights Commission (“the Commission”) (Horrocks, paras 2-3).

Procedural History

At the Human Rights Adjudication Panel (Horrocks v Northern Regional Health Authority, 2015 MBHR 3), the NRHA contested the adjudicator’s jurisdiction by arguing that a labour arbitrator appointed under a collective agreement has exclusive jurisdiction. The adjudicator disagreed, holding that the essential character of the dispute was “an alleged human rights violation,” and ultimately found that the NRHA discriminated against Ms. Horrocks. (Horrocks, para 3, emphasis in original). 

On appeal to the Court of Queen’s Bench (Northern Regional Health Authority v, 2016 MBQB 89), Justice Edmond disagreed with the adjudicator’s determination of the dispute’s essential character, holding that the dispute was about “whether the NRHA had just cause to terminate Ms. Horrocks’ employment” (Horrocks, para 4, emphasis added). Justice Edmond ruled that those types of disputes, including those associated with human rights violations, were within the exclusive jurisdiction of labour arbitration. The Manitoba Court of Appeal (Northern Regional Health Authority v Manitoba Human Rights Commission et al, 2017 MBCA 98) agreed with Justice Edmond’s ruling, but nevertheless concluded that the adjudicator had jurisdiction. It reasoned that Ms. Horrocks “made a choice to sever the employment and human rights aspects of her claim by not grieving her second termination” and that “the discrimination claim raised issues that transcended the specific employment context” (Horrocks, para 4). The NRHA appealed to the SCC.

The SCC’s Majority Decision

The Issue of Jurisdiction: Primary or Exclusive?

The main issue at the SCC was whether labour arbitration was the primary or exclusive forum for enforcing human rights issues arising from a collective agreement (Horrocks, para 14). Justice Brown, writing for the majority, relied heavily on SCC jurisprudence to support the holding that exclusive arbitral jurisdiction exists. One of the cases he relied on was Weber v Ontario Hydro, [1995] 2 S.C.R. 929 [Weber] (Horrocks, para 19). In Weber, the SCC clarified that the only relevant question to decide jurisdiction is whether the essential character of a dispute is factually related to the collective agreement terms. If the dispute factually arises from the collective agreement, then the matter falls within exclusive arbitral jurisdiction (Horrocks, para 20).

Based on SCC jurisprudence, the majority drew the “unavoidable” conclusion that mandatory dispute resolution clauses “signal a legislative intention to confer exclusive jurisdiction on the labour arbitrator” (Horrocks, para 30). In addition, the majority held that if the exclusivity of a labour arbitrator’s jurisdiction were dependent on the jurisdiction of a competing tribunal, this would cause the public to suffer from “persistent jurisdictional confusion” and not know which forum to use (Horrocks, para 31).

The Issue of Access to Justice

Ms. Horrocks and the Commission, the respondents, argued that exclusive arbitral jurisdiction raises access to justice concerns; if the union decides not to undertake arbitration, the employee has no option to pursue a human rights claim if labour arbitrators have exclusive jurisdiction. The majority responded to this argument by referring to the decision in Weber, which gave unions exclusivity over advancing their employees’ workplace-related Charter claims (Horrocks, para 36). The majority also explained that the union’s duty of fair representation and liability to human rights legislation should ease the respondents’ concern over the employee’s lack of control over choice of forum (Horrocks, para 37). For the majority, exclusive arbitral jurisdiction was simply “a product of legislative choice, to which [they] are bound to give effect” (Horrocks, para 38). 

The Statutory Scheme

In applying their analysis to the case itself, the majority first had to determine whether the relevant legislation granted exclusive jurisdiction to the arbitrator and, if so, the scope of that jurisdiction. There are two relevant statutes in this case: the Manitoba Labour Relations Act, C.C.S.M., c. L10 [LRA] and the Manitoba Human Rights Code, C.C.S.M., c. H175 [Code]. Section 78(1) of the LRA states:

Every collective agreement shall contain a provision for final settlement … by arbitration or otherwise, of all differences between the parties … concerning its meaning, application, or alleged violation.

The majority interpreted this section as a mandatory dispute resolution clause, holding that the legislative intent was to ensure that all disputes arising from the collective agreement are handled by only one forum (Horrocks, para 44).

They also explored s. 22(1) of the Code, which states: “[a]ny person may file . . . a complaint alleging that another person has contravened this Code.” The majority held that the “broad jurisdiction” of the Commission over violations of the Code is insufficient to counter the exclusive arbitral jurisdiction found under the LRA and find concurrent jurisdiction (Horrocks, para 45).

The Essential Character of the Dispute

The majority next determined whether the essential character of the dispute fell within the scope of the arbitrator’s jurisdiction. The majority said that in its essential character, Ms. Horrocks’ complaint was that the NRHA’s exercised its management rights under the collective agreement inconsistently with the prohibition on discrimination. The human rights tribunal should not have adjudicated Ms. Horrocks’ claim as her statutory rights were “too closely intertwined with [her] collectively bargained rights” (Horrocks, para 50). The majority explained that SCC jurisprudence clearly shows that “the mere allegation of a human rights violation does not bring a dispute within the jurisdiction of a human rights tribunal” (Horrocks, para 52). The majority ultimately concluded that there is exclusive arbitral jurisdiction over claims arising from the collective agreement and, except for one minor caveat, reinstated the trial judge’s order setting aside the adjudicator’s decision. (Horrocks, para 59).

Dissenting Judgment

In her lone dissent, Justice Karakatsanis disagreed with the majority that a labour arbitrator had exclusive jurisdiction and instead held that a labour arbitrator and the Commission had concurrent jurisdiction. 

After considering the case law relied upon by the majority, Justice Karakatsanis disagreed that SCC jurisprudence provides that disputes arising from the collective agreement automatically fall under arbitral jurisdiction absent express legislative intent to the contrary. She concluded that the jurisprudence “does not provide a rule of arbitral exclusivity when another statutory regime is in issue” (Horrocks, para 90).

In regards to the statutory scheme, she held that the LRA does not exclude the Commission’s jurisdiction under the Code, and the Code does not exclude the Commission’s jurisdiction over a unionized employee nor a labour arbitrator’s jurisdiction under the LRA. (Horrocks, para 100). Justice Karakatsanis also found that the dispute fell not only within the scope of the collective agreement but also within the Commission’s jurisdiction. She noted that the words “[a]ny person” in s. 22(1) of the Code is abundantly clear and that the Code‘s mandate addresses Ms. Horrocks’ complaint. Additionally, Justice Karakatsanis expressed grave concern for employees who are left without options after their respective unions refuse to file their grievances (Horrocks, para 105).

Finally, Justice Karakatsanis considered different factors that the Commission should consider in determining whether to defer to another forum that is suitable and available. One factor is whether a union is willing to pursue a grievance; if they are, the Commission may have good reason to defer to labour arbitration (Horrocks, para 125). Another factor is the remedy sought by the employee; if the employee is seeking reinstatement, labour arbitration would be the most appropriate forum (Horrocks, para 127). Conversely, if the employee is seeking damages or systemic changes, only a human rights tribunal would be able to offer those remedies (Horrocks, para 127).

Analysis

Use of Jurisprudence

The majority’s use of SCC jurisprudence to support their holding is rather unconvincing. As Justice Karakatsanis pointed out, the reasoning from Weber concerned arbitration over civil litigation (Horrocks, para 74). Therefore, Weber should not apply to this case as the jurisdictional issue at hand is between two statutory tribunals. The majority should not have equated the courts to statutory tribunals, which have vastly different mandates. The majority also relied on Quebec (Commission des droits de la personne et des droits de la jeunesse) v Quebec (Attorney General), 2004 SCC 39 [Morin] to support its finding of exclusive arbitral jurisdiction. However, Morin does not offer an answer to the issue of exclusive arbitral jurisdiction over disputes arising from the operation of the collective agreement; the dispute in Morin had arisen from pre-contractual negotiations. Therefore, Morin is not compelling jurisprudence for this case. I find that Weber and Morin do not support automatically conferring exclusive jurisdiction to a labour arbitrator when there is another statutory regime at play.

Concern Over Jurisdictional Confusion

The majority was also concerned with avoiding jurisdictional confusion, and did not want to “[leave the] members of the public unsure where to turn in order to resolve a dispute” (Horrocks, para 31). However, in this case, the issue was only between two tribunals, and the human rights tribunal would only come into play if the dispute concerned a human rights issue, meaning all other claims would be assigned to labour arbitration. The only confusion that may occur is over the area of human rights. I do not think that having two available legal forums would cause potential parties to become confused like the SCC fears; in the worst-case scenario, parties must prepare for both forums. Furthermore, if human rights tribunals use clear and reasonable criteria to decide whether to decline jurisdiction, then the public can look to that criteria to navigate concurrent jurisdiction and avoid jurisdictional confusion.

Concern Over Access to Justice

What was most troubling about the majority’s decision was its almost laissez-faire attitude to the concern of access to justice. The majority opined that the union’s duty of fair representation and liability to human rights legislation should ease the respondents’ concern that Ms. Horrocks would be left without legal recourse (Horrocks, para 37). They gave this opinion despite the fact that Ms. Horrocks had to file a complaint with the Commission because her union could not secure a satisfactory agreement for her through the grievance process. In contrast, Justice Karakatsanis said that given the Code’s use of “[a]ny person,” it is unacceptable to leave unionized employees without legal recourse when their unions refuse to file their grievances (Horrocks, para 105).  

While the majority did state that situations like Ms. Horrocks’ case is a “product of legislative choice, to which we are bound to give effect” (para 38, Horrocks), they nevertheless could have considered Ms. Horrocks and the Commission’s concern over access to justice more deeply in their reasoning. The failure of the majority to do so has serious consequences, as unionized employees will now be constrained to grievance procedures and be at the mercy of their unions when facing workplace disputes, including human rights issues.