For several years those privileged to teach constitutional law at Canadian law schools have been relieved of the need to make space in the first year curriculum to discuss freedom of association in section 2(d) of the Charter of Rights and Freedoms. Now, thanks to a remarkable decision from the Supreme Court of Canada issued on June 8, 2007, those days may be over.
In Health Services and Support - Facilities Subsector Bargaining Assn. v. British Columbia  S.C.J. No. 27, the Court ruled by a 6-1 majority that provisions of a B.C. statute dealing with health sector employment were unconstitutional. In doing so, the Court backtracked on a trilogy of labour law cases it decided in 1987, and ruled that section 2(d) of the Charter includes a right to collective bargaining.
In early 2002, B.C.'s new Liberal government under Premier Gordon Campbell enacted legislation rolling back gains that health sector unions had made in matters such as contracting out, lay offs and seniority rights. The legislation aimed to provide much greater flexibility in these areas to employers, including the government itself, and to thereby reduce labour costs. The unions challenged the constitutionality of the legislation, but lost before both the B.C Supreme Court and the Court of Appeal. They lost largely because those courts relied on existing Supreme Court of Canada jurisprudence.
In 1987, amidst the first run of Charter cases that gave the Court its early reputation for judicial activism, the Court surprised many observers by rejecting the arguments of labour unions that the Charter protected certain collective interests. In three cases– Reference re Public Service Employee Relations Act (Alta.), PSAC v. Canada, and RWDSU v. Saskatchewan– and again in a 1990 case, Professional Institute of the Public Service of Canada v. Northwest Territories (Commissioner), the Court gave a narrow reading to "freedom of association", ruling that it did no more than allow individuals to do in groups what they could do as individuals. Specifically, the Court ruled that section 2(d) included neither a right to strike nor a right to bargain collectively.
A significant crack in this approach came in a 2001 case, Dunmore v. Ontario. There, the Court found that section 2(d) included the right to unionize, and went on to rule that Ontario's denial to agricultural workers of the statutory right to certify was an unjustifiable breach of the Charter.
The Health Service decision relies heavily on Dunmore, but expands on its reasoning. All nine Justices agreed that the right to bargain collectively, defined as "a procedural right to bargain collectively on conditions of employment" (para 41), is central to the associational activity of unions. The Court ruled that it is an infringement of section 2(d) of the Charter for governments to interfere in a substantial way with the right to collective bargaining.
What constitutes ‘substantial interference'? The majority developed a two-part test. First, does the impugned legislation interfere with an important aspect of the collective bargaining process? Laws intended to prevent workers from forming a union (as in Dunmore) or laws intended to break a union would meet this test; but so also would laws that had the effect of discouraging workers from forming associations and bargaining collectively. The majority states:
Laws or state actions that prevent or deny meaningful discussion and consultation about working conditions between employees and their employer may substantially interfere with the activity of collective bargaining, as may laws that unilaterally nullify significant negotiated terms in existing collective agreements. (para 96)
The B.C. statute indeed nullified negotiated terms and rendered future negotiations pointless on important matters like contracting out, and so fell afoul of the first part of the test.
The second part of the test goes to whether or not the manner in which the government has interfered with collective bargaining "respect[s] the fundamental precept of collective bargaining - the duty to consult and negotiate in good faith" (para 97). This implies that the government's own failure to consult on proposed legislation that interferes with collective bargaining may itself contribute to a finding of a breach of freedom of association. Indeed, the Court makes a point of the fact that the Campbell government engaged in no consultation with the affected unions apart from a phone call to notify them of Bill 29, made 20 minutes before the Bill was introduced into the legislature. Moreover, the legislation included provisions that nullified terms in existing collective agreements that required employers to consult with unions on changes to contracting out provisions. This, the Court says, had the effect of undermining collective bargaining.
The majority found that the sections on contracting out breached section 2(d), and could not be justified under section 1. It based the latter conclusion in part on the government's failure to consult the affected unions, which suggested that it had not "minimally impaired" the section 2(d) right. The majority issued a declaration of invalidity, but suspended it for a period of 12 months to allow B.C. to decide how it wishes to rectify the problem. Justice Deschamps dissented largely on the section 1 issue. She argued that given the serious health care budget problems faced by the government in 2001, and the likelihood that its goals for the health sector could not have been achieved through collective bargaining or consultation, considerable deference was owed to the government.
The immediate import of the Health Services decision lies in the field of labour relations. The decision would seem to provide a strong boost to the status of unions and collective bargaining at a time when they have otherwise been buffeted by myriad winds of change. Apart from anything else, the judgment sends a message to governments that unilateral action directed at changing the terms of collective agreements, without consulting the affected parties, is a risky endeavour.
There are other reasons, however, for calling the decision remarkable. One of these has to do with the idea of a "duty to consult" as an organizing principle of Canadian constitutional life. In our system, we view the federal and provincial legislatures as sovereign, subject only to the limits placed on their actions by the Constitution. An element of legislative sovereignty is the idea that legislatures owe no common law procedural duties to the public, or interested segments of the public. This concept is a staple of Canadian public law. If a legislature wishes to pass a law, it may do so without seeking the approval of any external parties (let's leave Her Majesty out of this for now), and without having to stop to find out what anyone has to say about it.
However, the Supreme Court has been making inroads on this principle. The most well-known inroad is in the area of aboriginal and treaty rights, where governments face a duty to consult before taking actions that infringe on rights covered by section 35(1) of the Constitution Act, 1982. The duty to consult has become one of the mainstays of aboriginal rights law. With the Health Services decision, the Court has implicitly added a constitutional duty on governments to consult with respect to legislation in the labour relations field that infringes associational rights, such as the right to bargain collectively. We have seen forms of a duty to consult arise in two other constitutional arenas: that of judicial compensation as a feature of judicial independence; and the ‘duty to negotiate' in the case of a successful referendum on the secession of a province from Canada.
What is the duty to consult? In all of the instances cited above, the Court has stressed that the duty is procedural only and does not bind governments to any substantive outcome. However, the Court has also been at pains to say that the duty is more than a mere duty to talk. The talking must be meaningful, and it must be undertaken in good faith. The goal must be to seek a mutually acceptable resolution to the dispute at hand, even if a solution is not found. In each instance, the Court has sought to create sub-processes or mechanisms (in the case of judicial independence, Judicial Compensation Commissions) to give the duty to consult some bite. The irony in the Health Services case, is that the duty to consult on the government is imposed in the interests of the duty to consult (bargain collectively in good faith) imposed by law on employers and unions.
The Court appears to be engaged in an intriguing effort to expand the constitutional base for deliberative democracy in Canada. Good on it, I say. Except for that part about the first year curriculum. Maybe the trade and commerce power can be cut down to one day.