Supreme Court ruling protects federally regulated workers from unfair dismissal

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Non-unionized workers at the big banks and media companies and others in the federally regulated work force are protected from being unjustly fired, much as unionized workers are, the Supreme Court of Canada ruled on Thursday.

The 6-3 ruling was delivered in a case initiated by a supervisor at Atomic Energy of Canada Ltd. who was fired without an explicit reason and given a generous severance package. The supervisor, Joseph Wilson, claimed that his 2009 firing was in reprisal for blowing the whistle on corrupt procurement practices at the Crown corporation. AECL argued that giving notice or severance meant that it did not need to give a reason for the dismissal.

The ruling turned on the court's interpretation of Canada Labour Code (CLC) provisions giving federally regulated workers the right to complain to an adjudicator if they feel that they have been unjustly dismissed.

The court majority said that in the 1,740 cases since those provisions became law in 1978, adjudicators had ruled in all but 18 cases that employers could not dismiss a worker without cause. That view, and only that view, was a reasonable reading of Parliament's intent, it said.

In a stinging reference to the dissent, which cited those rulings as evidence that adjudicators were split, Justice Rosalie Abella wrote for the majority: "What we have here is a drop in the bucket which is being elevated to a jurisprudential parting of the waters."

The Supreme Court ruling does not constrain companies from dismissing employees for economic reasons or because their workplaces are being restructured; workers do not have the right to complain to an adjudicator in these cases.

But it means that employers need to give a cause, such as misconduct, incompetence or conflict of interest. In many cases, that would mean the employers have to undertake progressive discipline – showing workers their mistakes and trying to help them improve – before dismissing an employee.

Apart from Quebec and Nova Scotia, similar job-security protections for non-unionized workers do not exist in other provinces.

Lawyers representing federally regulated companies say the ruling puts those companies in a bind, because employees who are not a "good fit" are not ones who can or should be dismissed through the disciplinary process.

"Where it's clear there's not a good fit with the employee's skills, attitude and capabilities, employers are really in a bind," Karen Jensen, a spokeswoman for the Canadian Association of Counsel to Employers, said in an interview.

"So those employees now have really employment for life. And this makes it difficult for federally regulated employers to manage their work force in such a way as to remain competitive in the global economy."

The Canadian Labour Congress applauded the court's decision. "It is about equal treatment of workers in our country regardless of whether they have the privilege of belonging to a union or not," said Hassan Yussuff, the CLC's president.

There are 12,000 businesses and 820,000 workers in the federally regulated sector, or about 6 per cent of all workers, according to a federal fact sheet. The sector includes banks, marine shipping, telephone and cable companies, radio and TV broadcasting and many First Nations activities. About 500,000 of those workers are not unionized, many of them in the banks, according to Mr. Yussuff.

The ruling is the Supreme Court's third in a year that strengthens worker rights. The previous two determined that Canadians have a constitutional right to organize into unions and to strike.

"In Wilson, the court continues its arc of promoting workplace justice, and indeed extends it to include non-unionized workers, and statutory as well as constitutional law," University of British Columbia law professor Joel Bakan said in an e-mail.

His comment echoed a line from Justice Abella's majority ruling last year declaring a right to strike, in Saskatchewan Federation of Labour v. Saskatchewan: "Clearly the arc bends increasingly towards workplace justice."

That quote echoed Martin Luther King Jr.'s words: "The arc of the moral universe is long, but it bends towards justice."

A labour adjudicator who heard Mr. Wilson's complaint ruled in his favour. But AECL appealed the ruling to the Federal Court of Canada, which ruled against Mr. Wilson. The Federal Court of Appeal upheld that ruling, and Mr. Wilson appealed to the Supreme Court.

"A dismissal without cause is not per se unjust, as long as adequate notice is provided," Justice Russell Brown and Justice Suzanne Côté wrote for the Supreme Court minority, supported by Justice Michael Moldaver.

James LeNoury, a lawyer representing Mr. Wilson, said his client will now go back to the adjudicator for a ruling on whether he was unjustly dismissed. The important part of the ruling is that federally regulated workers who are unjustly dismissed are eligible for reinstatement or back pay, much as unionized employees are, he said.

Mr. Wilson said he fought the case because it was "a matter of principle, and there were some serious issues going on there that compelled me to make a report. I was basically persecuted for being honest."

Shannon Quinn, an AECL spokeswoman, said the company "seeks to manage its human resources in compliance with Canadian labour laws, and is pleased that the Supreme Court of Canada has clarified the law in this area. We will review the recent Supreme Court decision and ensure that our human resource policies and practices are aligned."