Overview of Ontario Court Ruling Striking Down Bill 124

Overview of Ontario Court Ruling Striking Down Bill 124

Justice Koehnen of the Ontario Superior Court in a decision released November 29 struck down Bill 124. The ruling arises from a court challenge of the bill brought forward by the Ontario English Catholic Teachers’ Association v. His Majesty, 2022 ONSC 6658.[1]

The Ontario government introduced the bill in June 2019 to limit “wage increases for approximately 780,000 workers in the broader public sector to one per cent per year for a three-year moderation period” proclaiming it into force on November 8, 2019. The bill contained measures for a three-year window of salary moderation and compensation restraint for non-union and unionized employees employed by the Ontario government, Crown agencies, the broader public sector and a range of organizations that receive funding from the Ontario government.

The applicants argued that the Act limited the “freedom of association, freedom of speech and equality rights of their members under the Canadian Charter of Rights and Freedoms.” Ontario in response asserted it did not limit these rights but in the event that it did, “it is saved by s. 1 of the Charter as a reasonable limit that is demonstrably justified in a free and democratic society.”

Justice Koehnen found that the Act did infringe “on the applicants’ right to freedom of association under s. 2(d) of the Charter,” but “does not violate the applicants’ freedom of speech or equality rights under the Charter and that the Act is not saved by s. 1 of the Charter.”

The Justice pointed out, “It is well-established that Charter rights are to be interpreted generously and purposively. The constitutional right to collective bargaining therefore goes beyond merely the right to associate in the sense of having a right to meet together. Rather, it guarantees the right to a meaningful collective bargaining process that allows workers to meet with employers on more equal terms, to put forward the proposals they wish and to have those proposals considered and discussed in good faith.”

Koehnen noted that Supreme Court jurisprudence “also holds that governments infringe on this right when a government measure ‘substantially interferes’ with collective bargaining.”

The Justice wrote, “State action substantially interferes with collective bargaining when, among other things, it prevents or restricts subjects from being discussed as part of the collective bargaining process.”

In his ruling, he noted that the limit to wage increases of one per cent essentially limited the ability of workers to trade off wage increases for other improvements, limited unions’ ability to address staffing shortages with increased pay, and interfered in interest arbitration, which is supposed to permit the independence of arbitrators, something the bill overturned.

Koehnen noted that the main aim of the legislation was to prevent strikes, something the government lawyers readily admitted, and that this was not a legitimate aim, as strikes constitute part of the collective bargaining process and are a way in which workers assert their power. He argued that when the law imposes limits on what can and cannot be negotiated, collective bargaining actually exacerbates the power imbalance between workers and state in favour of the state because it prevents a process of discussion over matters of concern to the workers.

“[If] one of the underlying purposes of collective bargaining is to equalize power imbalances between employees on the one hand and employers or the state on the other hand, that purpose is fundamentally undermined when the state intervenes by imposing limits on wage increases,” he wrote.

“In that latter situation, collective bargaining does not equalize power. Rather, it exacerbates inequality by allowing the state to prevent employees from having a meaningful discussion about the issue. While the Charter may not protect outcomes, it should also not allow the state to predetermine outcomes,” he added.

Also of interest was that the judge affirmed the experience of workers in the long-term care field during the pandemic especially those who noted that their low wages and benefits are directly linked to shortages in staffing both in terms of the inability to keep workers, but also as a mechanism for employers to save money. The judge quoted extensively from an affidavit of a personal support worker in a long-term care facility in Thunder Bay who explained that the abysmal working conditions, chronic understaffing and unfilled positions result in those working having to do the work of two workers simply to provide the most basic care for elderly residents.

“It is left to overworked, frontline, low-wage, employees to witness the deterioration in their patients’ condition because staff shortages render employees unable to provide residents with the level of care they require. It is for the same employees to live with the disappointment of patients who cannot receive something as basic as a weekly bath. It is for the same employees to deny a dying patient the comfort of another human being as their lives end. Employees live with this day in day out. They break down in tears. They exhaust themselves. They burnout. They leave for less stressful jobs thereby further exacerbating the vicious cycle of short staffing,” he quoted.

Exposing what workers have been saying for years about the crisis in health care the judge noted: “In the long-term care sector, 65 per cent of jobs are part-time. In extreme cases, bargaining units have two to four times as many part-time as full-time employees even though workers want and need full-time work. In the hospital sector, less than 50 per cent of CUPE employees are full time. Approximately 30 to 40 per cent of the part-time workers have more than one job to make ends meet. In the nursing sector, 45 per cent of nurses are less than full-time. Thirty percent are part-time and 15 per cent are casual. Many part-time employees hold two or more jobs to make ends meet.”

“The often traumatic conditions under which employees in the health care sector work leads working conditions caused by staffing issues to be a significant priority. These are key collective bargaining issues. Given staff shortages, the collective bargaining power of employees would generally be increased in a way that would enable them to improve wages, ameliorate staff shortages and improve working conditions. The one per cent salary cap has taken that power away from employees” he wrote.

Justice Koehnen then turned to the government’s argument that the violation of rights was in fact reasonable. He went through various examples to show that the government really was unable to provide any justification for its limits on rights other than it wanted to prevent strikes and exercise “fiscal prudence.”

The judge wrote that the government can violate rights but it has to make a rational case to show a connection between the measures and the goals, and that the goals have to be legitimate. In this case he affirmed that preventing strikes is not a legitimate goal and that the government did not make a case for why the limits on wage increases were required when at the same time the government was giving out substantial tax cuts and giving rebates on license plate stickers. He noted that he was not saying the government should not do these things as this was their prerogative, but that it did not give legitimacy to its claim of the necessity for wage restraint.

Koehnen wrote, “With respect to balancing the benefits and negative effects of the Act, in circumstances where Ontario has not provided any satisfactory explanation for why it could not limit wage increases during collective bargaining negotiations, the negative effects of the Act outweigh its benefits.”

He wrote, “[In] the context of this case, the Act is not a reasonable limit on a right that can be demonstrably justified in a free and democratic society under s. 1 of the Charter.”

The Justice in conclusion declared Bill 124 “to be void and of no effect.”

As a result of the legislation having been in effect since June 2019, the parties concerned requested that the Court defer to a future hearing its consideration of any remedy to be awarded.

The Ontario government has expressed an intention to appeal the decision and will likely seek a stay of the decision pending the appeal. If the Court grants a stay of the decision this would pause the Court’s order of unconstitutionality pending the appeal to the Court of Appeal and possibly further to the Supreme Court of Canada.

  1. The parties to the case were the Ontario English Catholic Teachers’ Association, Ontario Secondary School Teachers’ Federation, The Elementary Teachers’ Federation of Ontario, Ontario Nurses’ Association, Ontario Federation of Labour, Ontario Public Service Employees Union, Unifor, Society of United Professionals, Local 160 of the International Federation of Professional and Technical Engineers, Power Workers’ Union (Canadian Union of Public Employees, Local 1000), Carleton University Academic Staff Association.