The YMHA participated in a federal job creation programme to renovate its premises, engaging unemployed workers whose wages were subsidized by unemployment insurance benefits and topped up by the YMHA.
The workers contested their classification as cleaners, arguing they performed construction work entitling them to higher wages under provincial legislation.
The Manitoba Labour Board agreed, but the Court of Appeal quashed the order, finding provincial wage laws inapplicable to the federal programme.
The Supreme Court of Canada allowed the appeal, holding that the workers were employees of the YMHA under provincial law and that the federal spending power used to establish the programme did not oust provincial jurisdiction over labour relations.
