Ontario Labour Relations Board
[1993] OLRB Rep. December 1318
1698-93-U; 3083-93-U National Automobile, Aerospace and Agricultural Implement Workers Union of Canada (CAW-Canada), Applicant v. Landawn Shopping Centres Limited, Responding Party; National Automobile, Aerospace and Agricultural Implement Workers Union of Canada (CAW-Canada), Applicant v. Landawn Shopping Centre Limited and, Jerome N. Sprackman, Responding Parties
APPEARANCES: Frank Luce appearing on behalf of the union and certain discharged employees; No one appearing on Frank Luce behalf of the respondent employer.
BEFORE: R. 0. MacDowell, Alternate Chair, and Board Members R. W. Pirrie and E. G. Theobald.
DECISION OF THE BOARD; December 13, 1993
This is an unfair labour practice complaint.
On November 4, 1993 the Board issued an interim decision [now reported at [1993] OLRB Rep. Nov. 1150], inviting the applicant and the responding parties to make representations on the Board’s jurisdiction to proceed, in the face of an outstanding exparte Order, made under the Companies Creditors Arrangement Act. This Order was obtained without notice to the union, the employees affected by the proceeding before this Board, or the Board itself; however, as we understand it, the respondent’s position is that, as a result of that Order, it need not adhere to the obligations in the Labour Relations Act, and is not subject to remedies available for breach of the Act.
The Board held a hearing on December 13, 1993 to consider the basis for and effect of the above-mentioned Order. Counsel appeared on the union’s behalf, and on behalf of certain employees whom the employer has discharged since the Board’s earlier decision.
Counsel for the responding employer faxed the Board to advise that the employer would not appear.
The issues raised by this case can be simply stated: To what extent can an ex parte Order issued under the CCAA, immunize an ongoing business, from the application of provincial statutes that protect the employees working in that business.
It is important to emphasize that the business to which the Order relates is not moribund. The company continues to carry on business and employ employees - although it no longer employs the union members to whom this complaint relates. The union says that these employees were recently discharged because they joined the union, and that such discharge occurred after the ex parte Order, and under its purported protective cloak. In the union's submission the responding party's business difficulties and restructuring are being used as a pretext to rid itself of union supporters - something which the Labour Relations Act prohibits.
The CCAA is intended to protect property and commercial interests. By contrast, provincial employment legislation is designed to protect the rights of workers - including their right to freedom of association, protection on the job from conditions threatening safety (and prohibited by the Health and Safety Act), protection from penalties based on race, religion, trade union affiliation, and so on. However, these statutory rights are given practical reality by enforcement mechanisms under provincial law. To suspend those enforcement mechanisms at the very least postpones these statutory rights, and may undermine the underlying right which the statute was designed to vindicate.
In this complaint, the union contends that all of the employees who opted for representation and collective bargaining have been discharged by the employer because they made that choice; but, of course, the issue might be the same if they were fired because they were black, or because they were Jews, or because they were women. As we have already said, the issue is a broader one: the extent to which the CCAA suspends worker protections under various statutes.
Counsel for the union asserts that the CCAA (and by implication Orders made under it) cannot suspend these worker protections or statutory remedies, because, to so read it, would create a collision with the Charter of Rights and Freedoms, which protects freedom of association, guarantees equal protection of the law, protects security of the person, and so on. He says that the suspension of the provincial statutes which give substance to these guarantees, contravenes the Charter, and cannot stand. He also raises interpretation issues concerning the extent to which the CCAA a statute designed to protect the interests of lenders, can, when properly construed, circumscribe the statutory rights of employees. He points out that no one has had the opportunity to consider the legal underpinnings or the potential limits of the CCAA, given the way in which the matter came before the Court. And, of course, the Order itself may be varied should the Court consider this to be appropriate.
We think this case poses difficult and fundamental legal questions concerning the interplay of Federal regulatory legislation designed to protect property interests, and provincial regulatory legislation designed to protect the interest of workers. It requires careful consideration of the general legal framework in which the Board operates, and the extent to which the Labour Relations Act protections may, (or may not) clash with the CCAA. It is necessary to consider whether there is such collision, and if there is, whether this is the appropriate forum to resolve the conflict.
Accordingly, we think that it is prudent to reserve with respect to our jurisdiction to proceed with this case, as it relates to Landawn Shopping Centres Limited the corporate entity which has sought the "protection" of the CCAA.
However, in a related complaint the union has also named Jerome N. Sprackman, the owner and directing mind of the respondent company. The union points out that the Labour Relations Act covers not only employers (the corporation) but also persons acting on behalf of employers; and in the union's submission, Mr. Sprackman is a "person" acting on behalf of the responding party Landawn Shopping Centres Limited. Mr. Sprackman, it is alleged, is the person who directed the illegal acts. And Mr. Sprackman is not protected by the CCAA or the Court Order.
We see no jurisdictional impediment to entertaining the complaint against Mr. Sprackman even though the proceedings against the corporate employer may be stayed. However, it is not obvious that this is a practical way to proceed at this stage - in effect, to sever proceedings because one of the responding parties is temporarily immune. That, too, requires consideration.
Finally, we were told that tomorrow, December 14, 1993, the Court will be be asked to review and extend the Order mentioned above. Neither the union, nor the employees, nor the
Board have actually been served with such application; but union counsel said that he had heard about it, that he intended to appear, and that he would bring his clients' concern to the attention of the Court.
- In all of these circumstances, the Board considers it prudent to reserve with respect to all of the legal and practical issues that have been put before us. We also think that it is prudent to have the Board's own counsel in Court, tomorrow, to speak, as necessary, to the impact of and Order on the ongoing litigation before us. If it is intended that the restructuring permitted and protected by the CCAA may include the abrogation of the employees' statutory rights, it would be useful to have that question clarified. We might also add, parenthetically, that Orders of this kind are appearing with increasing frequency as businesses restructure; so an issue which is specific to these particular parties may have broader legal ramifications for labour relations statutes in this province. That is why the Board identified the Attorney General's interest in its decision of November 4, 1993.
[On December 14, 1993, Mr. Justice Houlden made the following order on consent of Landawn Shopping Centres Limited and CAW-Canada: "This Court orders that the present proceedings against Landawn Shopping Centres Limited before the Ontario Labour Relations Board (Board File Numbers 1698-93-U and 3083-93-U) be and are hereby allowed, nunc pro tunc, to continue to ad]udication, provided that no order of the Ontario Labour Relations Board made in connection with the proceedings shall be enforceable without first obtaining the leave and direction of this Honourable Court.". Editor]