International Union of Operating Engineers, Local 793 v. Peter Kiewit Sons Co. Ltd.

[1988] OLRB Rep. May 510

2590-87-R; 2974-87-R International Union of Operating Engineers, Local 793, Applicant v. Peter Kiewit Sons Co. Ltd., Respondent v. Group of Employees, Objectors; Labourers International Union of North America, Ontario provincial District Council, Applicant v. Peter Kiewit Sons Co. Ltd., Respondent v. Interna­tional Union of Operating Engineers, Local 793, Intervener #1 v. United Broth­erhood of Carpenters and Joiners of America, Local 38, Intervener #2

BEFORE: R. A. Furness, Vice-Chair, and Board Members W. A. Correll and T. Theobald.

APPEARANCES: David A. McKee, Jack J. Slaughter and J. Anderson for the applicant and inter­vener #1; Daniel J. Shields, Alex Drummond and Dan Old for the respondent; L. A. Richmond, B. Suppa, J. Mancinelli, H. Mancinelli and N. Scibetta for the Labourers International Union of North America, Ontario Provincial District Council; David A. McKee arld Arthur Varty for inter­vener #2; no one appearinag for the objectors.

DECISION OF THE BOARD; May 18, 1988

1. The name of the respondent is amended to read: "Peter Kiewit Sons. Co. Ltd.".

2. The applicants have each applied for certification. At the commencement of the hearing counsel for the Labourers' International Union of North America, Orttario Provincial District Council ("the Provincial Council") informed the Board that; even though he disputed the status of the International Union of Operating Engineers, Local 793 ("Local 793") to participate in these proceedings and was of the view that these proceedings ought to be combined; it was his position that the Board could deal with a constitutional issue which has been raised[ with by the respondent. All of the other parties agreed that the Board could and ought to deal with the constitutional issue initially. The Board ruled that it would hear and decide the constitutional issue. This ruling was made without prejudice to the objections raised by counsel for the Provincial Council.

3. It was the position of the respondent that its operations in connection with the rehabili­tation of the West Lock Wall Face of Lock No. 2 at the Welland Canal ("the Canal") in St. Catharines, Ontario, were an integral part of the operation of a federal undertaking and that the Board was without jurisdiction to entertain these applications. The Provincial Council and Local 793 adopted the position that the Board had jurisdiction to entertain these applications. The Board heard evidence from Daniel Old the respondent's job superintendent on the Canal.

4. The respondent is a federally incorporated company and has a contract with The St. Lawrence Seaway Authority (the "Authority") which essentially involves the rehabilitation of por­tions of the Canal. The Authority is an agency of the federal government and in the contract there is an Appendix "D" which is entitled "Labour Conditions". Appendix "D" contains the following provisions:

Interpretation

1. In these conditions

(a) "Act" means the Fair Wages and Hours of Labour Act;

(b) "Regulations" means the Fair Wages and Hours of Labour Regulations made pursuant to the Act;

(c) "contract" means the contract to which these Labour Conditions are attached;

(e) "contractor" means the person who has entered into the contract with the contracting authority;

(h) "Minister" means the Canada Minister of Labour;

Wage Rates

(a) All persons in the employ of the contractor, sub-contractor, or any other person doing or contracting to do the whole or any part of the work con­templated by the contract shall during the continuance of the work be paid fair wages that is such wages as are generally accepted as current for com­petent workers in the district in which work is being performed for the character or class of work in which such workers are respectively engaged: the wage rates paid for each classification of work shall be no less than those set out in Appendix "A" to these Labour Conditions, and in no case shall the wage rates paid be less than the minimum hourly rate of pay pre­scribed by or pursuant to Part III of the Canada Labour Code (Labour Standards).

Hours of Work

(a) Except as provided in paragraph (d) and Section 13, the working hours of persons employed in the execution of the contract shall not exceed S hours in a day or 48 hours in a week except where longer daily or weekly hours are authorized by the Minister in cases of exceptional circumstances.

(b) Except as provided in Section 13, all persons shall be paid for hours worked in excess of 8 hours in a day or 40 hours in a week at an overtime rate of at least one and one-half times the wage rates required to be paid under these Labour Conditions as set out in Section 2(a).

(c) Except as provided in Section 13, all applications for permission to exceed 8 hours in a day or 48 hours in a week shall be made to the contracting authority for reference to the Minister.

5. On November 24, 1987, Labour Canada mailed the following letter, which was received by the Authority:

November 24, 1987

Miss V. C. Durant

Secretary

The St. Lawrence Seaway

Constitutional Square

Suite 1400, 360 Albert Street

Ottawa, Ontario

K1R7X7

Dear Miss Durant:

OVERTIME PERMIT

FAIR WAGES AND HOURS OF LABOUR ACT

Reference: Your letter dated November 5, 1987

Contractor: PETER KIEWIT SONS CO. LTD.

Nature and Rehabilitation of West Wall

Location of Work: Face, Local 2 (1987) Welland

Canal, Seaway, Western Region

The Minister of Labour has approved the application for an overtime pernSit with respect to work performed during the continuance of the referenced contract.

All persons in the employ of the contractor, sub-contractor, or any other person doing or con­tracting to do the whole or any part of the work contemplated by the contract, may, during the continuance of the contract, work a maximum of 11.00 hours in any day and a maximum of 77.00 hours in any week, and no person shall be required or permitted to work in excess of these hours.

Notwithstanding the extension of maximum hours, all persons required or permitted to work in excess of standard hours applicable to the reference contract (i.e. 8.00 hours in any day and 40.00 hours in any week) shall be paid for the overtime at a rate of wages not less than one and one-half times the rate of fair wages required to be paid under the contract.

The contractor shall keep accurate records showing the names, trades and addresses of all per­sons in his employ and the wages paid to and the actual time worked by such persons, and the records shall be open for inspection by the Labour Affairs Officers of Labour Canada at any time it may be expedient to the Minister of Labour to have them inspected.

The prime contractor shall be responsible for informing all sub-contractors of the conditions set out herein and shall be held responsible for the strict adherence to the conditions on the part of the sub-contractors.

This permit is in effect from September 22, 1987

Yours truly

"M. Valiquette"

Regional Director

Great Lakes Region

On December 3, 1987, the Authority sent the following letter to the respondent:

December 3, 1987

Peter Kiewit Sons Co. Ltd.

1183 Finch Ave. West

Suite 201

Downsview, Ontario

M31 2V8

Attention: Mr. D. Old, P. EnR.

Dear Sir:

Reference: Contract 12-2072 - Rehabilitation of West Lock Wall, Face, Lock 2 (1987), Rehabili­tation Program, Welland Canal, Seaway Western Region

This will acknowledge your letter of November 5, 1987 in which you requested permission to work in excess of the hours established by the provisions of the Fair Wages and Hours of Labour Act on Contract No. 12-2072.

Attached is a copy of the permit issued by the Department of Labour authorizing you to work a maximum of seventy-seven (77) hours per week and eleven (11) hours per day.

Yours truly,

Glen P. Carlin, P. Eng.

Civil Engineer

6. It was necessary for the respondent to require its employees to work in excess of forty hours per week due to the requirements to schedule the work on the Canal. The work on the Canal is concrete demolition and involves plastering, anchoring and refacing the crest wall of Lock No. 2. A portion of the wall of Lock No. 2 is blasted by dynamite. This leaves a much thinner, by about three feet, section of concrete. Reinforcing steel is then driven into the concrete walls. Some new concrete forming work is required and a small amount of excavating is done in connection there­with. The respondent is a privately owned corporation and is not an agency of either the federal government or any provincial government and does not operate the Canal or any part of the Authority. In accordance with the laws of Ontario, there is a health and safety representative on the Canal and the respondent is complying with the Workers' Compensation Act of Ontario with respect to its seventy to seventy-five employees who are working on the Canal. The work of the respondent on the Canal is inspected by safety inspectors from the Ministry of Labour of Ontario and the respondent agrees that the Ministry of Labour of Ontario has authority over the work on the Canal.

7. Under the terms of the contract with the Authority, the respondent is required to pro­cure and has procured its manpower from local sources. While the respondent procured its man­power from local sources as much as possible, some of its employees have travelled from Alberta and Saskatchewan. The respondent has also engaged the' services of private subcontractors from various locations in Southern Ontario. While the respondent is primarily involved in heavy engi­neering projects it has divisions which undertake different forms of construction such as roads, excavations, airport runway resurfacing, power houses and earth dams.

8. It is the position of the respondent that the work in question is being done on a federal undertaking and that the federal government has exercised its jurisdiction and is regulating the labour relations of the respondent and has effectively occupied the field. The respondent argued the doctrine of paramountcy and reasoned that since the federal government has occupied the field, therefore, federal legislation ought to by applied and not provincial legislation. The position of the respondent, however, does not take into account that the field of labour relations is not an overlapping field and that there is no basis for saying that the field has been occupied by the federal government. In Tennant v. Union Bank of Canada, [18841 A. C. 31, Lord Watson stated that the legislation of the Parliament of Canada, so long as it relates strictly to matters within the enumera­tions in section 91 of what is now called the Constitution Act 1867 is of paramount authority. The field of labour relations however is not a shared jurisdiction and there is a line between federal and provincial jurisdiction in labour relations.

9. It is now well settled that as a general proposition of law the provinces have exclusive jurisdiction over labour relations matters. See Toronto Electric Commissioners v. Snider, 1925 CanLII 331 (UK JCPC), [1925] A.C. 396. By way of exception, Parliament has jurisdiction over labour relations if such jurisdic­tion is an integral part of its primary competence over some federal subject matter. See In the Mat­ter of a Reference as to the Validity of the Industrial Relations and Disputes Investigation Act, [19551 S.C.R. 529. Therefore, there can be no doubt that notwithstanding the fact that labour relations is generally a matter of provincial jurisdiction, Parliament has jurisdiction over the labour relations of employees who are engaged in the operation of the Canal. The issue before the Board in the instant case is whether the employees of the respondent engaged in construction work on the Canal come within provincial jurisdiction or federal jurisdiction.

10. Earlier decisions of this Board in Robertson-Yates Corporation Limited, [1962] OLRB Rep. Oct. 215 and in Schwenger Construction Limited, [1965] OLRB Rep. Feb. 576, the Board held that the labour relations with respect to certain types of construction fell within federal juris­diction. In Robertson-Yates Corporation Limited, supra, a general contractor was engaged in the ¶construction of a number of structures at the Canadian terminus and approaches at Niagara Falls, Ontario, including a port of entry into Canada with customs and immigration installations, the cus­toms compound and warehouse, toll lanes and toll booths. In Schwenger Construction Limited, supra, a general contractor was involved in the twinning of Lock 2 on the Canal and in determining that the labour relations of the employees of such a general contractor fell within federal jurisdic­tion, the Board followed the decision of the privy council in CPR v. The Corporation of the Parish of Notre Dame de Bonsecour, [18991 AC. at 367. However, these cases were decided before the decision of the Supreme Court of Canada in Construction Montcalm Inc. v. Minimum Wage Com­mission et al., infra. In the light of the decision of the Supreme Court of Canada in that case, the two other decisions of the Board referred to in this paragraph must now be taken to have been incorrectly decided.

11. The issue is whether the employment relations between an identifiable employer and its employees is, in fact, a federal undertaking or is so integral to another federal undertaking as to require the federal government to regulate the employment so as to fully regulate the undertaking. The work performed on the Canal is similar to other types of construction. Employees may be employed by the respondent on construction work in Ontario, Alberta or Saskatchewan and there is no distinction between the work required on the Canal and other jobs. It appears to the Board that similar skills are required from skilled tradesmen for various types of construction. The employment relationship does not change simply because of the nature of the work on which the labour is being expended. The test to be applied is whether the work is so integral to the federal undertaking that it must be regulated by the federal government, otherwise the federal govern­ment will lose its ability to regulate the primary concern, that is to say, the Canal. The Supreme Court of Canada dealt with an analogous issue in Construction Montcalm Inc. v Minimum Wage Commission et al., 1978 CanLII 18 (SCC), [1979] 1 S.C.R. 754 where Beetz, J. stated as follows at pages 773-776:

In the case at bar, the impugned legislation does not purport to regulate the structure of run­ways. The application of its provisions to Montcalm and its employees has no effect on the struc­tural design of the runways; it does not prevent the runways from being properly constructed in accordance with federal specifications; nor has it even been shown, assuming it could be, that "the physical condition" of the runways, as opposed to their structure, is effected by the wages and conditions of employment of the workers who build them.

In submitting that it should have been treated as a federal undertaking for the purposes of its labour relations while it was doing construction work on the runways of Mirabel, Montcalm pos­tulates that the decisive factor to be taken into consideration is the one work which it happened to be constructing at the relevant time rather than the nature of its business as a going concern. What is implied, in other words, is that the nature of a construction undertaking varies with the character of each construction project or construction site or that there are as many construction undertakings as there are construction projects or construction sites. The consequences of such a proposition are far reaching and, in my view, untenable: constitutional authority over the labour relations of the whole construction industry would vary with the character of each con­struction project. This would produce great confusion. For instance, a worker whose job it is to pour cement would from day to day be shifted from federal to provincial jurisdiction for the pur­poses of union membership, certification, collective agreement and wages, because he pours cement one day on a runway and the other on a provincial highway. I cannot be persuaded that the Constitution was meant to apply in such a disintegrating fashion.

To accept Montcalm's submissions would be to disregard the elements of continuity which are to be found in construction undertakings and to focus on casual or temporary factors, contrary to the Agence Maritime and Letter Carriers' decisions. Building contractors and their employees frequently work successively or simultaneously on several projects which have little or nothing in common. They may be doing construction work on a runway, on a highway, on sidewalks, on a yard, for the public sector, federal or provincial, or for the private sector. One does not say of them that they are in the business of building runways because for a while they happen to be building a runway and that they enter into the business of building highways because they there­after begin to do construction work on a section of a provincial turnpike. Their ordinary busi­ness is the business of building. What they build is accidental. And there is nothing specifically federal about their ordinary business.

Since the decision in Montcalm it is clear that only in the rarest exceptions would construction work fall outside of provincial jurisdiction.

13. In a similar factual situation in Re Attorney General of Nova Scotia and Maritime Engi­neering Ltd. et al., (1980) 1979 CanLII 2551 (NS CA), 105 D.L.R. (3d) 158, the Appeal Division of the Nova Scotia Supreme Court held that an employer who was engaged exclusively in building and repairing wharves under a contract with the federal government on federal land came under provincial jurisdiction with respect to its employment relations with its employees. The Court held that Parliament has no jurisdiction over labour relations as such but that it might assert exclusive jurisdiction where it had exclusive or primary legislative competence and jurisdiction over labour relations as an integral part of that competence. The Court held that, while Parliament has exclusive legislative compe­tence over navigation and shipping, where an independent contractor with its own employees was engaged in a ~vork to further that head of jurisdiction, namely, the construction and repairing of wharves, the power to regulate its labour relations did not form an integral part of the federal juris­diction over navigation and shipping. In that case the contractor worked exclusively for the federal government. The Court reasoned that a province had jurisdiction to certify a trade union for the contractors' employees. In the situation before this Board, the respondent does not even work exclusively as a contractor for the federal government.

14. The construction activity is an activity which is not essential to the operation of the Canal. See, for example, the remarks of Jackett, C.J. in Re Canadian Airlines Employees' Associa­tion and Wardair Canada (1975) Ltd. et al., (1980) 1979 CanLII 4076 (FCA), 97 D.L.R. (3d) 38, pp. 42-43. The work in ques­tion takes place when the Canal is not in operation. There is no jurisdiction in the federal govern­ment with federal legislation to cover the provincial labour relations aspect of the job on the Canal merely by asserting jurisdiction and applying certain federal legislation.

15. The Board has jurisdiction to entertain this application for certification and the Regis­trar is directed to list this matter for continuation of hearing. This panel is not seized with these applications.