Bill C-257 (Historical)

An Act to amend the Canada Labour Code (replacement workers)

The purpose of this enactment is to prohibit employers under the Canada Labour Code from hiring replacement workers to perform the duties of employees who are on strike or locked out.
The enactment also provides for the imposition of a fine for an offence.

[Tony Martin, NDP, Sault Ste. Marie, ON]

I tend to agree that where this committee has been effective and has got some work done--and it has got some work done--we have met as a subcommittee to air out some of the positions of each of the parties and had, I thought, a respectful and thoughtful conversation amongst ourselves. I think we achieved some things there.

The object is to make this committee work and to get some work done on behalf of the people of Canada and our constituents. The more we can use a process to get us there, the better.

Where I've been frustrated, Mr. Chair, is when on a couple of occasions—this is why I said it worked relatively well as opposed to perfectly well—an agenda arrived at committee where obviously decisions had been made somewhere that were a surprise to me. I felt I wasn't given an opportunity to really get into that and find out why, how, etc., and how that would impact further work that some of us wanted to get done.

But I thought overall we got some work done. We're into a fairly contentious piece of business right now with Bill C-257, and we have to expect that there will be some manoeuvering, shall we say, going on. But overall, I think we've been achieving some success, and I think the success has been achieved because we have been meeting in that smaller group from time to time, a subcommittee, to air out and deal with some of those areas that might be contentious and get them out of the way or at least addressed so that we can move forward.

It's about relationships, and about building relationships. For me, that's what happened there and caused the committee to be more constructive, proactive, and able to get some things done.

[Peter Massy]

I have two comments.

First of all, it's not required in Bill C-257 because section 87.4 has it and has laid it out. There are examples of how section 87.4 works.

Second, on the issue of balance, section 87.4 says that we cannot have a labour dispute unless we agree to a maintenance of activities.

The term “replacement workers” is a different kind of language because in that case the union has to prove they've actually hired them for the purposes of undermining the trade union.

So on one hand, we can't even have a labour dispute unless we sign a maintenance of activity. On the other hand, we can't challenge the replacement workers under the existing code unless we first prove the motive of the company. There is a blatant imbalance right there.

[Patrick Brown, Conservative, Barrie, ON]

Another concern I have with this proposed legislation is that, as much as we've referenced the Quebec example, at least the ban on replacement workers in Quebec was detailed in the legislation. There was at least some work put into it. You see some legislation of 90-odd pages, and look at this: it's two pages. It doesn't even begin to deal with the plethora of situations you may have that are off the general plane.

One situation in particular that I'm concerned about is telecommunications. I have it in my notes that the Canada Industrial Relations Board ruled that telecommunication services are not essential to public health and safety within the meaning of the Canada Labour Code. What ramification is this going to have on the services you provide and for the ordinary Canadian? I mean, 911 deals with telecommunications, the RCMP, and the Department of National Defence. What is this going to mean for the ordinary Canadian requiring emergency services? What is this going to mean for your organizations, for services with nuclear power generation stations, hydro-monitoring sites?

It is amazing that it wasn't contemplated in Bill C-257 that this would not be thought of. It seems it was rushed through without ample background and research being put into potential challenges associated with this.

Is there some feedback you can share on the telecommunications side?

[David Bradley]

I think that's what we tried to say in our submission as well, that we have a relatively stable labour relations climate in our industry. We said that we don't see the necessity for Bill C-257. We don't know what it would bring to the table to give whatever balance is supposedly missing from the workers' side right now. It's there; it's working.

[Patrick Brown, Conservative, Barrie, ON]

Thank you, Mr. Allison.

When I look at Bill C-257, I look at what is the optimal balance between negotiating parties. My concern with this proposed legislation is that it would take away from that optimal balance.

Mr. Martin mentioned the experience in Ontario. I look at the successive premiers since then. Mr. Harris, Mr. Eves, and Mr. McGuinty all said they didn't want to revisit that period in Ontario, when we had a recession, and it also coincided with the use of this legislation.

I wonder if that's because it damages the optimal balance. I would certainly like to get your input on how this affects the balance that we need to have in these negotiations.

I look at Ontario and Quebec, two provinces currently with different approaches in labour legislation.

Mr. Barnes, you mentioned there is no evidence that replacement worker legislation results in shorter durations of work...and that's what I found as well as I looked through this. Over the 2003-05 period, work stoppages in Quebec were 47 days on average, compared to 38 in Ontario. This suggests that jurisdictions that don't adopt a ban on replacement workers are able to more successfully have peaceful labour relations.

To further highlight this point, I think Human Resources provides statistics continuously from 1976 to 2005. Continuously, if you look at the number of work stoppages per 10,000 employees, Ontario has had a far greater level of success than Quebec. As recently as 2005, the year for which we have the most recent available statistics, it's 0.12 out of 10,000 employees, versus 0.25 for Quebec.

When you look at something on a broad level over a quarter of a century and it speaks to a trend, I think there's something we can learn from that.

I want to get input from Mr. Barnes, Mr. Pollard, and Mr. Jennery on how you feel this might damage the optimal balance.

[Peter Massy]

It would be incorrect to say that activities are not maintained during a labour dispute. In our brief to the committee we provided a copy of a letter—I'm sorry that it's not translated--called “Maintenance of Activities”. There's nothing in Bill C-257 that would suggest section 87.4 is going to be removed.

In the labour dispute with Telus in 2003, we signed off a letter that explicitly ensured that our members would be available 24 hours a day, seven days a week, to maintain 911 emergency, police, fire, ambulance, hospitals, coast guards, and anything else, if need be, for the purposes of protecting the public as mandated by the code.

So the code clearly has...and this is where the imbalance is. The code clearly lays that out, that we have to protect the public. At the same time, we don't have the same balance when it comes to the use of replacement workers.

[Peter Barnes]

But our understanding of the effect of this bill is that Bill C-257 would mean that essential services would no longer be protected. The prohibitions contained in Bill C-257 would invalidate or impair the ability to provide those services.

[Peter Barnes]

I can't comment on the matters between one of my members and the union. I'm not here to represent Telus. I think our big focus is essential services and the lack of protection of essential services that's contained in this bill. Certainly as replacement workers, or lack thereof, affects this, that's really our focus.

[David Bradley, Chief Executive Officer, Canadian Trucking Alliance]

Thank you very much, Mr. Chairman, and members of the committee.

My name is David Bradley. I'm CEO of the Canadian Trucking Alliance. We represent in excess of 4,500 trucking companies across Canada.

It is our view that Bill C-257 is unnecessary, and if you'll bear with me, I'd like to explain why.

First, a little bit about our industry. We are the dominant mode of freight transportation in the country. We touch 90% of all consumer products and foodstuffs, and we make an exceedingly important contribution in terms of Canada's international trade, hauling two-thirds, by value, of Canada's trade with the United States.

The broader trucking industry includes for-hire carriers, which can be either federally or provincially regulated, and private carriers, which are those that move their own goods and are provincially regulated. The industry employs in excess of 350,000 Canadians. Those are direct jobs.

A third of the total trucking labour force are employee drivers in the for-hire trucking sector—and when I say employee drivers, that's distinct from the independent owner-operator contractor.

The proportion of truck drivers who fall under the federal labour regulations is not known with certainty, but according to HRSDC, just over 100,000 employees in trucking are covered by at least some part of the Canada Labour Code.

Trucking is made up predominantly of small firms. About 78% of employee drivers work for companies with fewer than 100 people, and 39% work for companies employing fewer than 20.

The level of unionization in our industry—at no more than 20% of employee drivers—is relatively low compared to the general workforce.

With regard to Bill C-257, for us it's a question of balance. Collective bargaining is a question of balance. Parties to any negotiation attempt to gain an upper hand through various means. The role of the regulatory environment is to try to ensure a level playing field and to maintain the appropriate balance in negotiations, not to confer the upper hand to either party through legislation or regulation.

In our view, the current climate of labour relations in the trucking industry would suggest that balance exists. While the level of unionization, as I said, is low, the portion of the industry that is unionized is characterized by stable labour relations. In the period 2000 to 2006, there were only seven work stoppages in the trucking industry in companies regulated by part I of the Canada Labour Code. The average length of work stoppage during that period was 15.5 days. There were no strikes or lockouts by companies under federal jurisdiction in either 2004 or 2005. Not known in these work stoppages is the degree to which replacement workers were used. However, we feel that there were very few, if any, used.

The nature and structure of the trucking industry has characteristics that promote balance and labour stability. For one, competition is always vigorous and often fierce. There are at least 10,000 for-hire trucking companies competing for freight, and that's a reflection of economic deregulation that has existed in our industry since the late-1980s. Economic deregulation and fierce competition dictate that carriers will survive only if costs are controlled and if they provide the service to which their customers have become accustomed.

Trucking service is a perishable service. It's not like a manufactured product, where if you don't get your price today it can sit on the shelf until another customer comes in tomorrow. We don't have that luxury in the trucking industry. If a carrier's not happy with the price it is able to obtain for its service, there's always someone else who will take the freight, either at that price or at a lower price.

There's competition not only for freight but also for qualified drivers. There's a lot of driver mobility, and the resulting turnover or churn in the industry is extremely high. In some sectors it approaches 100%. So in the event of a protracted strike at a trucking company, the organization would soon be out of business. Competitors would move quickly to take over that freight.

From a broader societal view, we raise the following concerns. Trucking serves every community accessible by road. In remote areas, many communities are served only by truck, and delays in delivering to Canada's most vulnerable communities could be devastating for its residents.

Of particular concern is the volume of just-in-time freight delivered across Canada and into the United States. Transportation disruptions in just-in-time delivery could affect our major trading partner's confidence in the cross-border supply chain, resulting in reduced sourcing of products from Canada.

In the event of a labour stoppage in other federally regulated freight modes such as rail, we simply do not have the capacity, nor do we have the kind of equipment, that would be used to move most of what rail does. So it would prevent us from taking up any slack that there may be.

The potential to have transportation services halted, ports closed, and intermodal facilities shut down would be felt by all Canadians.

As I said at the outset, we feel that Bill C-257 is unnecessary. Some have even referred to it as a solution in search of a problem. Evidence from jurisdictions across Canada shows that either banning or allowing replacement workers has little or no impact on the frequency or duration of work stoppages.

Again, according to HRSDC, the average number of working days lost because of strikes has gone down in nearly all provinces in the past several decades—including British Columbia, where there is a ban, and Ontario, where there is not. The existence of or the lack of anti-replacement-worker legislation appears to have nothing to do with this general trend in labour relations.

Parliamentary intervention to order employees back to work occurred frequently before 1999, when the amendments to the Canada Labour Code prevented the necessity of such legislation. Bill C-257 would turn the clock back. Pressures for return-to-work legislation to assure continuity of essential services could again become the norm.

Thank you very much.

[Nick Jennery, President and Chief Executive Officer, Canadian Council of Grocery Distributors]

Thank you, Mr. Chairman and members of the committee.

My name is Nick Jennery, president and CEO of the Canadian Council of Grocery Distributors. I represent the small, medium, and large grocery distributors on both the retail and food service sides. It's about $72 billion on the retail side, and about $12 billion on the food service side, to companies that you may know, such as Loblaws, Metro, Sobeys, and Safeway, as well as some of the smaller companies like Thrifty and Kitchen Table.

I have provided members of the committee with an annual report that describes in more detail who we are and what we do. I've also provided a fact sheet on the number of direct employees that we have. We have a little more than 428,000 in the industry. Finally, we do operate, through 24,000 stores, in every community in Canada.

Mr. Chairman, I'm here to provide some input into Bill C-257 and to outline my industry's concerns with its provisions. For our sector and for the Canadian consumer, any legislation prohibiting replacement workers for companies that fall under the Canada Labour Code could have very serious implications for our industry. I do not believe this proposed legislation is in the interests of Canadians or Canadian business, and I have developed a submission for consideration by the standing committee. For today's purpose, I did want to highlight just three specific concerns.

The first concern is our industry's dependency on the transportation sector. My members account for about 85% of all the grocery products that are distributed in Canada to all of those 24,000 stores, hospitals, restaurants, institutions, and long-term care facilities, and each one of those products passes through a distribution or a retail network.

CCGD members do not fall under the Canada Labour Code per se, but we are reliant on rail and interprovincial trucking to do that and to meet the food needs of Canadians. At any one time, if you take over a two-week period, there are approximately 10,000 food shipments either in rail or on trucks in transit. This is equivalent to hundreds of millions of kilograms of food.

There is not a significant excess capacity in the transport sector, and CCGD members operate on a just-in-time inventory basis. At any one time, we have between three and ten days of inventory in the pipeline, and our efficiency is also our vulnerability. This means that if a sizable transport company such as CN or CP is prevented from providing services due to a strike and anti-replacement-worker legislation in place, significant supply disruptions will occur.

My industry has experienced two significant labour-related transportation disruptions in recent years: the Port of Vancouver disruption in 2005, and the Atlantic trucking dispute in 2003. Just to give you a flavour of what happened, a huge portion of food supply for Atlantic Canada is shipped in by truck, especially during the winter months. A labour disruption in 2003, with a blockade that lasted only two days, resulted in shortages of food and required the direct intervention of the Premier of Nova Scotia. Both examples are relatively minor compared to what would occur if CN or CP or one of their major rail yards were prevented from operating due to anti-replacement-worker legislation.

The second point I'd like to make to the members of the committee is the balance of powers during the negotiation or collective bargaining process. Proponents of Bill C-257 are claiming that anti-replacement-worker legislation is necessary to introduce a balance within the collective bargaining process, since, without the legislation, unionized employers under the Canada Labour Code are permitted to continue operating during a strike. This is simply not the case.

Under the present provisions of the code, fairness and equity are maintained during the collective bargaining process through two powers that balance each other and ensure that both parties are equally motivated to achieve a fair and equitable agreement. These powers are the employees' right to strike, balanced by an employer's ability to try to withstand a strike through the continuation of operations.

The employees' right to strike is supported by their ability to receive strike pay from the organizing body and the employees' ability to seek temporary or alternative work during the strike. Banning the use of replacement workers hinders the ability of the employer to withstand a strike, and dramatically increases the bargaining power of the employees during the collective bargaining process.

Anti-replacement-worker legislation introduces a bias against the employer and swings the collective bargaining process dramatically in favour of the employee or the unions.

The third point I want to quickly make is about the competitive impact on our industry. I've mentioned the size of our industry, and we're clearly in the fight of our life. We're a 1% to 2% after-tax business, with labour being the second-largest input into the industry.

CCGD members operating in both Quebec and British Columbia have had extensive experience with anti-replacement-worker legislation. With provincial anti-replacement-worker legislation, the threat of being unable to continue operations in the event of a labour dispute has decreased the bargaining power of employers during contract negotiations and it has translated directly into higher supplements and increased costs for unionized employers. In a highly competitive environment, unionized employers are increasingly competing in all sectors of the economy against non-union competitors.

Implementing anti-replacement-worker provisions will further undermine the competitiveness of unionized employers and provide non-union employers with a government-regulated advantage. The outcome of this will be that Bill C-257 will translate into increased costs for the users of services of unionized companies that fall under the Canada Labour Code.

Given the reliance of virtually all aspects of the Canadian industry on this sector, it is ultimately the Canadian consumer who will pay for the costs of Bill C-257, in the form of higher prices for a very broad spectrum of goods and services. Bill C-257, in our opinion, may actually endanger the unionized jobs it is endeavouring to protect, and it is a reality of the modern global marketplace that businesses must remain cost-competitive in order to survive.

To conclude, I believe the Canada Labour Code and the powers of the Labour Relations Board provide boundaries on the use of replacement workers and ensure that both parties are equally motivated to achieve a mutually beneficial collective agreement. Bill C-257 would upset the balance between employers and unions in the collective bargaining process. In the long term, this will undermine the ability of employers to bargain effectively and will have a tremendous impact on the competitiveness of unionized employers versus domestic and global competitors. CCGD is most concerned about the potential of the bill to hamper our ability to feed and service Canadian consumers, your constituents. As such, we are opposed to the implementation of this legislation.

I believe the government has a responsibility to Canadians rather than to any party at the collective bargaining table. Therefore, the government must ensure that labour legislation does not hamper the access of Canadians to basic needs, such as what my members distribute.

I would urge members of the standing committee to reconsider their support of this legislation in light of its far-reaching social and economic implications, and I'm most happy to assist the committee in any way in providing further information, as you see fit.

Thank you.

[Peter Barnes, President and Chief Executive Officer, Canadian Wireless Telecommunications Association]

Thank you, Mr. Chairman and honourable members. My name is Peter Barnes, and I'm president and chief executive officer of the Canadian Wireless Telecommunications Association. I too am pleased and indeed honoured to be here today to share our concerns about Bill C-257.

You should have in front of you a copy of our submission, which we filed with the clerk. The copy you have is in both official languages. We've also provided a copy of a report by Human Resources and Social Development Canada. It addresses many of the questions about investment and about strike duration and frequency, which I understand many committee members had asked about.

I'm here today to urge you not to proceed with this piece of legislation.

The CWTA is the authority on wireless issues, developments and trends in Canada. The association represents over 200 members in cellular and PCS, messaging, mobile radio, fixed wireless and mobile satellite carriers as well as companies that develop and produce products and services for the industry. Together, our members provide 95 per cent of the wireless services used by Canadians.

Our most pressing concern is for the safety of Canadians. We believe Bill C-257 will undermine public safety in Canada by preventing wireless telecommunications companies from maintaining the delivery of essential services to Canadians in the event of a strike or lockout. In addition, CWTA shares the concerns of other witnesses before this committee, concerns such as that the bill will significantly change the existing balance in part I of the Canada Labour Code without a full consultation; that a prohibition on replacement workers could lead to longer and indeed more frequent work stoppages; that Bill C-257 could require Parliament to pass back-to-work legislation in strike situations; and that Bill C-257 will damage Canada's economy, particularly with regard to small and medium-sized companies, as well as suppliers.

Recognizing their status as an enabling industry for all Canadians, telecommunications carriers join rail and banking as a federally regulated industry, bound by a range of federal legislation and statutes, in this case, the Canada Labour Code.

Nationally, Canada's wireless carriers employ approximately 15,000 people. Of these, the majority are unionized workers. Within each carrier, unionized workers undertake the majority of key operational requirements: including network operations — which includes the day to day maintenance and operation of the various networks provided by each carrier — engineering, maintenance, customer service, billing and other.

When I speak of wireless carriers, I want to emphasize that I do not mean only Bell, Rogers, and Telus. Among our membership, there are at least ten smaller regional carriers that serve communities like Thunder Bay, Kenora, or Prince Rupert. For these companies, the inability to meet their service commitments in a strike would be devastating to them—and to their communities, more importantly.

Canada's wireless telecommunications industry provides critical public safety and security services to municipalities, police, fire fighters, EMS, and to individual Canadians every day.

While most of us think of wireless telephony as being strictly a consumer product, wireless products and services are the backbone of the public safety and emergency response infrastructure in Canada. Wireless products and technologies are present in every aspect of Canada's safety infrastructure, helping hospitals, police forces, fire and ambulance services, and search and rescue teams do their jobs every day. In the case of police, for example, the various wireless services and technologies are part of the daily tools used by officers in the field. These provide uninterrupted, two-way communications between officers in a squad car under dispatch and services such as mobile fingerprinting, crime databases, and so on.

These, as I think you understand, can be a matter of life or death for officers in the field, allowing them to quickly identify suspects and be ready to respond appropriately to potentially dangerous situations within seconds. The majority of police forces use commercial networks managed by our members for these services.

Canada's wireless carriers currently meet the Solicitor General's standards of providing lawful access, upon receiving a warrant, to our voice networks. This means having dedicated security staff who work exclusively to provide police services on a 24/7 basis. We also provide a crucial role in assisting Canadians during emergency situations. Whether it was during the ice storm of 1998, the Vancouver mudslides, the fires in Kelowna, or the floods in Manitoba, wireless carriers were on the front lines working with emergency services personnel to provide a secure and fast communications channel for emergency assistance.

All of these services are conditional on having trained staff who can step in at a moment's notice with a robust, well-maintained infrastructure. In the event of a strike, with no ability to use any replacement workers except for select management personnel, wireless carriers would have grave difficulty providing these essential services. For these reasons, I would ask all honourable members to vote no to this bill.

I thank you. Merci.

[Anthony Pollard, President, Hotel Association of Canada]

Thank you very much. I appreciate the opportunity, Mr. Chairman and members of the committee. My name's Tony Pollard. I'm president of the Hotel Association of Canada. As I said, we want to thank you for this opportunity to be here today.

We're very strongly opposed to this bill, and right at the outset we recommend that it not go forward. Let me just give you a very brief background on what the hotel business is, how big we are, and what we do.

Last year, in 2006, we generated revenues of about $17.6 billion. The value-added from our industry, that's all the things that go into it and all the people who depend upon us, was another $16.2 billion. Perhaps more importantly for the benefit of this committee, we employ 378,000 people across the country directly or indirectly. The wages and salaries of all these individuals came to about $6.7 billion last year.

Also, as I like to point out to our friends in government whenever I appear before these committees, the revenues generated for all three levels of government, or what most of us would probably know as taxes, were about $6.9 billion last year, with $3 billion going to the federal government. Again, that's something to underline. I'd like to point out that most of you look upon us as pretty good friends because of those numbers we generate for you.

This bill aims to prohibit employers under the Canada Labour Code from using other workers, including existing non-bargaining employees, to perform the duties of employees who are on strike or locked out. Now the current part of part I of the Canada Labour Code came into being after years of hard work, including the task force headed up by Andrew Sims.

The Sims task force attempted to create a balance between the interests of employers with those of the workers. The title of the report, “Seeking a Balance”, I think is very telling. Unfortunately, it did not reach unanimity on the replacement worker issues. The majority report recommended a provision that would give employers flexibility in meeting their operating responsibilities, but would prevent them from using replacement workers to undermine a union's legitimate bargaining objectives.

After the report had been released and with the intervention of the Minister of Labour, the end result was a provision based upon the majority view. As such, the current version of part I was developed through a process that attempted to address the interests of all stakeholders, not those of just one stakeholder at the expense of others. But that is precisely what we believe Bill C-257 would do.

Further, it would undo years of effort of developing fair labour legislation at the federal level. Industries that fall under federal jurisdiction, including some hotels, have endured work stoppages over the years. This has caused many difficulties for Canadians and for Canadian businesses. There have been countless situations where back-to-work legislation has been required. This has significantly diminished since 1999, because we believe we now have a legislative framework that is more conducive to all the parties settling their own disputes.

The proposed legislative changes would negatively impact workers. The best protection for a worker who is on strike is to have confidence that there will be a job to return to. That is best assured by allowing that enterprise to remain operational during a strike. It is important to recognize that a hotel never closes. When a hotel does close, it is often very difficult to reopen. We all suffer, including our employees. This proposed legislation could most definitely result in this outcome.

While some suggest that banning the use of other workers would result in more industrial harmony, studies have shown that anti-replacement-worker legislation often results in an increase in strike incidents and duration. Therefore, longer strikes with limits on the enterprise's ability to continue operations can harm a worker's job security. If the bill is passed we will go back, unfortunately, to a far more contentious labour relations climate.

Therefore, Mr. Chair and members of the committee, we recommend the change proposed in Bill C-257 should not go forward without a comprehensive review of its implications for Canadian businesses, the employment legislation review process, and the overall balance of part I of the Canada Labour Code.

Thank you for this opportunity.

[The Chair, Conservative, Dean Allison]

Order. Pursuant to the order of reference of Wednesday, October 25, 2006, we will now continue to hear witnesses on Bill C-257, An Act to amend the Canada Labour Code.

Our order of business is to have some committee business and then some witnesses, but I'm just going to switch that around. We're going to have our committee business right after we hear from our witnesses.

I would like to thank all the witnesses for taking the time to be here today for this very important legislation. We're going to give each of you seven minutes for your opening remarks. and then we'll have a couple of rounds of questions—three rounds, if possible, but two rounds for sure—of seven minutes in the first round followed by a second round of five minutes. Any round after that will be five minutes as well. So if you're not able to get all your points out, hopefully you'll be able to during the questions and answers.

Joining us through video conference is Mr. Massy from Burnaby.

Can you guys hear us?

[Michael Savage, Liberal, Dartmouth—Cole Harbour, NS]

Mr. Hattin, regarding your business, I have heard from businesses in my own riding that have said they're concerned about this, and they've given me different reasons. You were asked a little bit, I think by Mr. Hiebert, about the example. Can you tell me specifically what infrastructure you are most concerned would be affected if Bill C-257 became law?

[Mike Lake, Conservative, Edmonton—Mill Woods—Beaumont, AB]

Thank you.

Mr. Sinclair, do you have a copy of Bill C-257 in front of you?