Introduction
A labor relationship between parties is regulated by the contract. Any disputes regarding the terms of the contract may be settled in the Court. The Courts established common law rules determining the rights and duties of the employer and employee. Nevertheless, the employment conditions were often unsafe and harmful, hours of work long and wages low. The government started passing laws to combat exploitation of employees by employers. In 1900s government started establishing minimum employment standards, which became the basis for modern labor standards legislation.
While the government was taking legislative actions, employees started forming trade associations to increase their bargaining power by collective negotiations. Those trade unions were initially considered illegal. In 1940s legislation was passed requiring employees to consider unions as the bargaining agent for a team of employees (Karabegovic, Gainer, Palacios & Veldhuis 76). The development of labor law did not stop with the introduction of labor legislation. Labor arbitration was established as an efficient and fair method of resolving workplace disputes in Canada.
Historical Background
Lack of modern legislative framework impeded the development of arbitration in Canada. Until the 1990’s, the provinces hardly recognized any discrepancy between domestic and international arbitration in Canada. The Federal Parliament had not passed any legislation regarding arbitration by 1986. The legislation was based on the English Arbitration Act of 1889. In the early 1990’s, the government admitted that to protect the developing reliance on the international level, the country has to adopt the international dispute resolution mechanism. In May 1986, Canada laid the foundation for the arbitral law when signed the United Nations Convention on Reciprocal Recognition and Enforcement of Foreign Arbitral Awards (McQuarrie 215). Nowadays Canada has a reputation of a country with well-established arbitration legislation.
Canadian labor relations are a provincial responsibility. Nevertheless, 10% of the work force is under federal jurisdiction. The explanation to this is that labor relations statutes frequently change in accordance with changing conditions. In Canada, arbitration of disputes over rights resembles the practice in the United States. In 1944, the federal government issued Privy Council Order 1003, which laid the foundation for a collective bargaining system in Canada (Casey 128). The Supreme Court expended the use of arbitration for the purpose of resolving employment disputes over the years. Currently, the arbitration is used for settling issues relate to collective bargaining agreement and individual employment agreements. The last category of cases belongs to the employment arbitration cases.
Labor Legislation in Canada
Canadian labor legislation is divided into Canadian Labor Law and the Canadian Employment Law. Both directions of labor law have the same legal meaning, and the only difference between them is that the Labor Law regulates the rights and responsibilities of trade unions, workers and employers, while the Employment Law regulates the rights and duties of employers, employees, and non-union members. (Karabegovic, Gainer, Palacios & Veldhuis 21). In addition to the above legislation, there are numerous internal guidelines and rules that complement labor laws and are used in the settlement of labor disputes.
The norms of labor law set the minimum time limits and conditions of work at the federal level, as well as, in the provinces of Canada. Labor standards include minimum wages, working hours, overtime pay, paid leave, other types of leave, public holidays, notice of dismissal and others. According to the normative legal acts in the system of labor legislation, the number of working hours cannot exceed a daily or weekly maximum. So in most provinces and territories, as well as, at the federal level, the maximum working time is 8 hours per day and 40 hours per week. Regardless of the ownership form of the enterprise or company, an employee has the right to a 30-minute break after every 5 hours of work. The employer cannot force employees to work over the statutory standards, as well as to dismiss them due to the unwillingness to work overtime. In other words, legislation on labor allows increasing working time if the employer and the employee reached common agreement on the issue.
An employee has the right to a paid annual leave. The number of days that an employee may be provided varies depending on the province. For example, in Ontario, British Columbia, Quebec and Alberta, an employee is entitled to two-week vacation after a year of work in a company. In this case, payments are made at a rate of 4% of the annual earnings. After five years in the same company three-week vacation is provided, and the leave allowance is paid of 6% of the annual earnings. According to the labor standards in Canada, holidays must be paid for. If the employees work on a holiday, their work is equivalent to overtime and paid accordingly (Krahn, H., Hughes, K., & Lowe 173).
In addition to paid leave, the legislation provides other types of leaves that include: maternity leave, paternity leave, sick leave, leave of absence due to unforeseen circumstances. An employee that uses one of these leaves is protected by law. In other words, an employer cannot fire or punish a worker who is temporarily absent duet to the objective reasons. The employer saves a job for the absent employee. However, the employer is not obliged to pay for such leaves since in this case the employee receives Employment Insurance (Karabegovic, Gainer, Palacios & Veldhuis 28).
Labor legislation in Canada clearly regulates the issues related to the dismissal of employees. There are three reasons for which an employee may be dismissed: dismissal for violations identified in the course of work; dismissal related to production necessity; voluntary redundancy. If an employee believes that he was dismissed illegally, he has the right to appeal the decision of the employer in court. In general, the manager always warns the employee of dismissal in advance. However, there are some cases in which the employer has the right to dismiss an employee without notice. In particular, this happens if an employee commits a gross violation or the term of employment, specified in the agreement came to an end. In other cases, the employer must notify the employee of his decision in writing. If the employee has not received a notice, the wage for the notice period must be paid, the sum of which depends on the employee’s position in the company. In the process of dismissal the employee must receive the Record of Employment (McQuarrie 76). The document confirms the status of unemployed and allows receiving Employment Insurance.
Every employee has the right to refuse the work that is considered to be unsafe for his life and health. To do this, he must notify the employer of his decision. The employer, in turn, is obliged to look into the situation and find out why the company did not provide the conditions for safe work. The manager has no right to dismiss an employee due to the refusal to work in dangerous conditions. In addition, the conditions and consequences of work injury are clearly defined in Canadian. Regardless of the province and the work, the employees who were injured in the course of their duties shall be entitled to financial compensation that is paid by Workers Compensation Fund (Casley 127).
Labor Unions in Canada
Canadian Labor Unions are the organizations, which represent Canadian employees in the negotiations with employers. In the 21st century, more than a quarter of the workforce belongs to a union. Labor Unions are involved in collective bargaining with employers to help employees negotiate issues related to salary, terms and conditions of work. Before unions were established, employees often worked overtime, for a low salary, and in unsafe conditions. Labor unions monitor the adoption of proper federal and provincial legislation in the field of labor relations and assure the adherence to standards in the implementation of social and health care programs, taxation, pensions, unemployment insurance, working conditions. A characteristic feature of the Canadian labor unions is a provincially-sectoral principle of their formation and functioning.
The largest union, Canadian Union of Public Employees was established in 1963. It unites more than 475 thousand of state employees. The main objectives of a labor union are to defend the workers’ rights in the process of collective bargaining with employers; to protect the rights and freedoms of workers in various industries, to struggle for the improvement of living standards. Labor unions also focus much attention on compliance with health standards and labor laws in the workplace, the nondiscriminatory approach in hiring. Unions play a significant role in negotiations with employers on the size of the wage, the basic elements of “social package”, and the conditions of retirement.
National Union of Public and General Employees is the second largest organization that joins 14 independent unions. The number of members is about 325 thousand employees of the public sector. Almost 55% of members work in provincial institutions. Canadian Automobile Workers is the largest union in the private sector, which consist of 250 thousand members. Union represents the interests of industries, such as automobile assembly and production of auto parts, railways, aviation and space. One of the most influential unions is considered to be The Public Service Alliance of Canada. It has in its ranks more than 150 thousand of public servants. The main task of the union is to act as an agent in negotiations with employers on issues of fair wages, improvement of job security degree, and settlement of labor disputes with the administration (Karabegovic, Gainer, Palacios & Veldhuis 35)
Concept of Arbitration
Arbitration is a procedure by which parties, by agreement submit a dispute for resolution to an independent third party, which has the authority to impose a solution if needed. Arbitration is considered to be an adjudicative, binding, and legal-based. It usually involves a “winner” and a “loser”. The procedure relies on finding of facts and legal outcomes from those facts. In legal terms, there is no a “non-binding arbitration”, but this term is used to depict the conciliation process. The Supreme Court of Canada describes the following as the specific features of the arbitration: an existing dispute between the parties; the authority to make a decision is granted to the independent third party; the third party make a decision in a judicial or quasi-judicial manner (Casley 79 ). Arbitration clauses are stipulated in the franchise agreements, intellectual property licensing agreements and construction contracts.
Dispute Resolution Forms
Mediation, conciliation, and mini-trials are the most common forms of Alternative Dispute Resolution. In mediation, a third party is chosen by the conflicting parties to assist them in resolving their dispute. The mediator listens to both parties and initiates a dialogue. If negotiations resulted in an impasse, then the mediator meets each party separately. If it is possible, the mediator may bring the parties back together to reach a final resolution. In case the of mediation, the mediator does not issue an enforceable or binding award. In Canada, mediation is not governed by any legislation. The main view is that the market may decide who is a good mediator to resolve the dispute (Casey 2011).
Conciliation is a procedure in which the conciliator takes a decision about how the problem ought to be resolved. It is often used alternatively with the mediation. Conciliators can play either a passive or active role. Conciliator’s report is presented to both sides involved in dispute. However, the conclusion is not enforceable unless the parties adopt it. This dispute resolution form is called “non-binding arbitration.” Similar to mediation, conciliation is not governed by any legislation in Canada.
One management member from each party and an independent advisor from the mini-trial panel are involved in a mini-trial. Having taken into account the evidence, the management representatives meet to find out if they can settle matters between themselves. If they cannot agree on a common stand, the third member of a panel acts as a mediator or conciliator to resolve the dispute. Either party may request a mini-trial if the dispute has not been settled by negotiations.
Arbitration of Labor Disputes
Most collective bargaining agreements include grievance procedures for resolving disputes on the meaning of agreement and possible violations. Nevertheless, it is necessary to discuss how disputes can be resolved when employer and employee cannot negotiate due to some reasons. In general, there are three stages to labor dispute resolution: conciliation, mediation, and arbitration. Conciliation is a way of resolving disputes when disputing parties meet separately with a third party that can help to facilitate negotiations. In the case of mediation, parties meet face-to-face together with a third party, but a final decision is not legally binding. Arbitration also stipulates face-to-face meeting of both parties with a third party that acts as arbitrator, whose final decision is considered to be legally binding (Karabegovic, Gainer, Palacios & Veldhuis 48).
In the case of dispute, it would be better for parties to take prior steps such as conciliation before resorting to arbitration, which may lead to increased costs for both parties and hostility between them. In Canada jurisdictions require that the labor agreements must include a mechanism for binding settlement of a complaint. In other words, most disputes in jurisdictions are resolved by binding arbitration. This is an important point of Canadian labor relation laws. For example, arbitration is voluntary in the United States compared to Canada. American legislation does not force parties to include binding arbitration clauses in the labor agreements.
Judicial Review of Arbitration Awards
Federal and provincial legislation give the labor arbitration process limited protection against judicial interference. The Canada Labor Code declares the binding effect of labor arbitration awards. In addition, a decision of an arbitration board or arbitrator is not a subject to questioning. The Alberta Labor Act, while including similar provisions in federal law, also states that the decision of an arbitration board or arbitrator may be questioned if it is filed with the Court within 20 days after the award issuance.
New Brunswick Industrial Relations Act claims that a court may set aside an arbitration award in following cases: an arbitrator misconducted himself in the proceedings; an arbitration award was improperly procured; the question was mistakenly considered as arbitrable. The Newfoundland Labor Relations Act requires parties or person bound by arbitration award to comply with the decision of an arbitrator. The act does not provide any reference to judicial review or filing of the award with a court (McQuarrie 115).
Nowadays the complexity and volume of disputes inevitably increased. Expectations of proper and efficient workplace dispute resolution are high. Well-developed labor standards and labor relations legislation provide solid ground for an efficient labor arbitration process that can fulfill those expectations. Arbitration board or arbitrator can resolve any disputes, including safety claims.
Works Cited
Casey, J. Arbitration Law of Canada: Practice and Procedure (2nd ed.). New York: JurisNet, LLC, 2011.
Karabegovic, A., Gainer, A., Palacios, M., & Veldhuis, N., Measuring Labor Markets in Canada and the United States (10th ed.). Vancouver: Fraser Institute, 2010.
Krahn, H., Hughes, K., & Lowe, G. Work, Industry, and Canadian Society (7th ed.). Ontario: Nelson Education, 2015.
McQuarrie, F. Industrial Relations in Canada (4th ed.). Toronto: Wiley &Sons Canada, Ltd, 2015.
