Centre Hospitalier Régina Ltée v. Labour Court

Centre Hospitalier Régina Ltée v. Labour Court
Collection
Supreme Court Judgments
Date
1990-05-31
Report
[1990] 1 SCR 1330
Case number
20746
Judges
Lamer, Antonio; Wilson, Bertha; L'Heureux-Dubé, Claire; Sopinka, John; Gonthier, Charles Doherty; Cory, Peter deCarteret; McLachlin, Beverley
On appeal from
Quebec
Subjects
Labour law
Notes
SCC Case Information: 20746
Decision Content
Centre hospitalier Régina Ltée v. Labour Court, [1990] 1 S.C.R. 1330
Centre hospitalier Régina Ltée Appellant
v.
Judge Bernard Prud'homme
and the Labour Court Respondents
and
Cécile Montigny, Syndicat national
des employés de l'Hôpital Régina
(C.S.N.) and Raynald Fréchette,
in his capacity as Minister of Labour Mis en cause
indexed as: centre hospitalier régina ltée v. labour court
File No.: 20746.
1990: January 26; 1990: May 31.
Present: Lamer, Wilson, L'Heureux‑Dubé, Sopinka, Gonthier, Cory and McLachlin JJ.
on appeal from the court of appeal for quebec
Labour relations ‑‑ Union ‑‑ Duty of representation ‑‑ Withdrawal by union of employee dismissal grievance following general agreement settling grievances when collective agreement renewed ‑- Whether union breached its duty of representation ‑‑ Limits on union discretion to take grievance to arbitration ‑‑ Scope of Labour Court's power of redress where union breaches its duty of representation -- Interpretation of ss. 47.2 to 47.6 of Labour Code, R.S.Q., c. C‑27.
Labour relations ‑‑ Labour Court -- Jurisdiction -- Scope of Labour Court's power of redress ‑‑ Withdrawal by union of employee dismissal grievance following general agreement settling grievances when collective agreement renewed ‑‑ Breach by union of its duty of representation ‑‑ Whether Labour Court exceeded its jurisdiction by referring employee's claim to arbitration ‑‑ Interpretation of ss. 47.2 to 47.6 of Labour Code, R.S.Q., c. C‑27.
As a result of many absences from work due to illness, an employee was notified by her employer that it regarded her behaviour as an abandonment of her position. At the employee's request, the union filed a grievance dismissal against the employer, and following numerous delays this grievance was entered on the social affairs arbitration roster. When the collective agreement was renewed, the employer and the union signed a general agreement to settle grievances, including the grievance relating to the employee's dismissal. A member of the union stated that it did not realize one of the grievances concerned a dismissal. When notified several months later that her grievance had been withdrawn, the employee filed a complaint with the Minister of Labour alleging a breach by the union of its duty of representation. As no settlement was reached between the employee and the union within fifteen days of the appointment of an investigator by the Minister, the employee filed an application with the Labour Court under s. 47.4 of the Code, asking that the Labour Court order that her claim be referred to arbitration. The Court held that ss. 47.2 et seq. of the Code were applicable since this was not an abandonment of a position but rather a dismissal. Characterizing the union's conduct as cavalier and arbitrary, the court concluded that it had failed in its duty of fair representation, allowed the application and referred the employee's claim to an arbitrator appointed by the Minister. The employer then applied to the Superior Court for a writ of evocation against the Labour Court's decision. The Superior Court dismissed the application and this judgment was affirmed by the Court of Appeal. This appeal concerns the interpretation of ss. 47.2 to 47.6 of the Code, and in particular, is to determine whether these sections are applicable to the claim of an employee whose grievance against her dismissal was the subject of an agreement between her employer and her union, when the matter was before an arbitrator but there had not yet been any decision on the grievance.
Held: The appeal should be dismissed.
By adopting ss. 47.2 to 47.6 of the Labour Code in 1977 the Quebec legislator codified the duty of representation and gave the employee a remedy in certain cases where the union breaches its duty. The duty of representation as codified in s. 47.2 of the Code does not differ greatly from that formulated by the courts prior to 1977. In a grievance proceeding, the union must (1) carefully consider the merits of the grievance to decide whether it should be taken to arbitration; (2) if the union decides that the grievance has merit, it must represent the employee without serious negligence, discrimination or bad faith at all subsequent stages of the grievance procedure. Although the union is acting as a defender of an employee's rights, it must take into account the interests of the bargaining unit as a whole in exercising its discretion whether or not to proceed with a grievance. However, this discretion is not unlimited. A union may not "sacrifice" any grievance which it feels is valid during negotiations with the employer in order to obtain a concession of better working conditions or other benefits for the bargaining unit as a whole. Though the union must have some discretion in collective bargaining to "swap" grievances, in exercising its discretion the union must take into account the nature of the rights which the employee is seeking to enforce by his grievance. There will be situations where the abandonment of an apparently valid grievance by the union will have such consequences for the employee in question that it will substantially restrain the union's discretion. The wording of ss. 47.2 et seq. of the Code is consistent with the view that the union's discretion is limited when confronted with a choice between its duty of care toward an employee and that of representing the members of the bargaining unit. The legislator has clearly indicated his preference by specifying in s. 47.3 the cases in which arbitration of a grievance may survive its abandonment by the union: namely, cases of dismissal and disciplinary sanctions. In this case, the union infringed its duty of representation as defined in s. 47.2 of the Code. The union, which disposed of the employee's grievance regarding dismissal without even telling her, exercised its discretion not on serious grounds, taking into consideration advantages beneficial to the employees as a whole, but rather on grounds completely unrelated to the facts of the grievance, in a case where the nature of the latter did not permit this approach.
Where a union which has filed a grievance regarding an employee's dismissal subsequently concludes an agreement with the employer by which it withdraws the grievance in violation of its duty of representation, the Labour Court has jurisdiction under s. 47.5 of the Code to refer the matter to arbitration. Section 47.5 applies because there had been no decision by an arbitrator on the merits of the case, as the arbitration process was interrupted by the conclusion of an agreement between the union and the employer before the grievance was heard. Such an agreement cannot be likened to an arbitral award (s. 101 of the Code) or a civil transaction (art. 1920 C.C.L.C.) so as to deprive the Labour Court of its jurisdiction under s. 47.5. The filing of the agreement with the arbitrator under s. 100.3 of the Code has a purely procedural purpose and is only intended to technically terminate the dispute between the employer and the union as well as to inform the arbitrator of the existence of the agreement. It does not have the effect of making the agreement final.
Cases Cited
Applied: Canadian Merchant Service Guild v. Gagnon, [1984] 1 S.C.R. 509; considered: Gendron v. Municipalité de la Baie‑James, [1986] 1 S.C.R. 401; Milhomme v. Aubé, [1984] C.A. 1; Collège d'enseignement général et professionnel de Dawson v. Baena (1987), 7 Q.A.C. 153; referred to: Bell Canada v. Canada (Canadian Radio-Television and Telecommunications Commission), [1989] 1 S.C.R. 1722; Steele v. Louisville & Nashville Railroad Co., 323 U.S. 192 (1944); Vaca v. Sipes, 386 U.S. 171 (1967); Gendron v. Supply and Services Union of the Public Service Alliance of Canada, Local 50057, [1990] 1 S.C.R. 000; Asselin v. Travailleurs amalgamés du vêtement et du textile, local 1838, [1985] T.T. 74; Bachiu and United Steelworkers of America, Local 1005, [1976] 1 Can. L.R.B.R. 431; Reference Re Public Service Employee Relations Act (Alta.), [1987] 1 S.C.R. 313; Syndicat des agents de la paix de la Fonction publique v. Richer, [1983] C.A. 167.
Statutes and Regulations Cited
Act respecting remuneration in the public sector, S.Q. 1982, c. 35.
Act respecting the conditions of employment in the public sector, S.Q. 1982, c. 45.
Civil Code of Lower Canada, art. 1920.
Code of Civil Procedure, R.S.Q., c. C‑25, art. 846.
Labour Code, R.S.Q., c. C‑27, ss. 47, 47.1, 47.2 to 47.6, 63(a), 72, 100.0.2, [ad. 1983, c. 22, s. 62], 100.3 [am. 1983, c. 22, s. 67], 101, 101.6, 109.1 et seq., 139; repl. 1982, c. 16, s. 5; am. 1983, c. 22, s. 93].
Authors Cited
Blumrosen, Alfred A. "The Worker and Three Phases of Unionism: Administrative and Judicial Control of the Worker‑Union Relationship" (1963), 61 Mich. L. Rev. 1435.
Clark, Julia Penny. "The Duty of Fair Representation: A Theoretical Structure" (1973), 51 Tex. L. Rev. 1119.
Gagnon, Jean-Denis. "Le devoir de représentation des associations de salariés en droit canadien et québécois" (1981), 41 R. du B. 639.
Gagnon, Robert P. Droit du travail. Dans Cours de la formation professionnelle du Barreau du Québec 1988‑1989, vol. 6. Cowansville, Que.: Yvon Blais, 1988.
Gagnon, Robert P., Louis LeBel et Pierre Verge. Droit du travail. Québec: Presses de l'Université Laval, 1987.
Mailhot, Louise. "La liberté syndicale: droits collectifs et droits individuels ‑‑ commentaires", dans Rodrigue Blouin et autres (ed.), Le Code du travail, 15 ans après ... Québec: Presses de l'Université Laval, 1979.
Matteau, Colette. "La liberté syndicale: droits collectifs et droits individuels ‑‑ commentaires", dans Rodrigue Blouin et autres (ed.), Le Code du travail du Québec, 15 ans après ... Québec: Presses de l'Université Laval, 1979.
Morin, Fernand et Rodrigue Blouin. Arbitrage des griefs. Montréal: Yvon Blais, 1986.
Morin, Fernand. Rapports collectifs du travail. Montréal: Thémis, 1982.
Weiler, Paul. Reconci­lable Differences: New Directions in Canadian Labour Law. Toronto: Carswells, 1980.
APPEAL from a judgment of the Quebec Court of Appeal, [1988] R.J.Q. 253, affirming a judgment of the Superior Court[1], declining to issue a writ of evocation against a decision of the Labour Court, D.T.E. 85T‑254. Appeal dismissed.
Louis Gagnon and Carmelle Marchessault, for the appellant.
André Fauteux, for the respondents and the mis en cause Fréchette.
Jean‑Yves Brière and P. Gonneville, for the mis en cause Montigny.
Maurice Sauvé, for the mis en cause Syndicat national des employés de l'Hôpital Régina (C.S.N.)
//L'Heureux-Dubé J.//
English version of the judgment of the Court delivered by
L'HEUREUX‑DUBÉ J. -- This appeal requires the interpretation of ss. 47.2 et seq. of the Quebec Labour Code, R.S.Q., c. C‑27 (hereinafter "L.C."), which govern the duty of fair representation of an employee association (or union) in labour relations and determine the consequences of noncompliance.
In particular, this case puts in question the finality of the settlement of grievances between an employer and a union in light of an employee's right to arbitrate a grievance filed against his dismissal. In the present case the settlement in question was concluded without the employee's participation and was part of a general agreement to settle grievances on the occasion of the renewal of a collective agreement.
The Legislation
This appeal essentially turns on the interpretation of the mechanisms established by ss. 47.3 to 47.6 L.C., regarding a union's duty of representation covered by s. 47.2 L.C. At the time this dispute arose, these provisions, as well as the provision relating to the filing of the collective agreement, read as follows:
47.2 [Behaviour of certified association] A certified association shall not act in bad faith or in an arbitrary or discriminatory manner or show serious negligence in respect of employees comprised in a bargaining unit represented by it, whether or not they are members.
47.3 [Complaint to Minister] If an employee who has been the subject of dismissal or of a disciplinary sanction believes that the certified association is, in that respect, violating section 47.2, he shall, if he wishes to invoke this section, submit a written complaint to the Minister within six months. The Minister shall appoint an investigator who shall endeavour to settle the dispute to the satisfaction of the interested parties and of the certified association.
47.4 [Application to Court] If no settlement has been reached within fifteen days of the appointment of the investigator or if the association does not carry out the agreement, the employee shall, if he wishes to invoke section 47.2, apply to the Court within the fifteen ensuing days to request that his claim be referred to arbitration.
47.5 [Authorization of Court] If the Court considers that the association has violated section 47.2, it may authorize the employee to submit his claim to an arbitrator appointed by the Minister for decision in the manner provided for in the collective agreement, as in the case of a grievance. Sections 100 to 101.10 apply mutatis mutandis. The association shall pay the employee's costs.
[Other order] The Court may, in addition, make any other order it considers necessary in the circumstances.
47.6 [Non‑observance of delays] If a claim is referred to an arbitrator pursuant to section 47.5, the employer shall not allege the association's non‑observance of the procedure and delays provided for in the collective agreement for the settlement of grievances.
72. [Agreement in force upon filing] No collective agreement shall take effect until the filing at the office of the labour commissioner‑general of five exemplars or copies, true to the original, of such collective agreement and of a true copy of its schedules. The same rule applies to any amendment subsequently made to such collective agreement.
. . .
These provisions remain unchanged to date apart from s. 47.4, where the time within which a settlement may be reached has been extended from fifteen to thirty days (S.Q. 1983, c. 22, s. 24).
The procedural framework used here is the motion in evocation pursuant to art. 846 of the Quebec Code of Civil Procedure, R.S.Q., c. C‑25:
846. The Superior Court may, at the demand of one of the parties, evoke before judgment a case pending before a court subject to its superintending and reforming power, or revise a judgment already rendered by such court, in the following cases:
(1) when there is want or excess of jurisdiction;
(2) when the enactment upon which the proceedings have been based or the judgment rendered is null or of no effect;
(3) when the proceedings are affected by some gross irregularity, and there is reason to believe that justice has not been, or will not be done;
(4) when there has been a violation of the law or an abuse of authority amounting to fraud and of such a nature as to cause a flagrant injustice.
However, in the cases provided in paragraphs 2, 3 and 4 above, the remedy lies only if, in the particular case, the judgments of the court seized with the proceeding are not susceptible of appeal.
Mention should be made here of s. 139 L.C., which prohibits recourse to art. 846 C.C.P.:
139. [Prohibited recourses] Except on a question of jurisdiction, no extraordinary recourse contemplated in articles 834 to 850 of the Code of Civil Procedure shall be exercised and no injunction granted against any arbitrator, certification agent, labour commissioner or the Court acting in their official capacities.
It is well settled law, however, that such a privative clause is not a bar to the exercise by the ordinary courts of their superintending and reforming power in cases of excess of jurisdiction by a statutory tribunal subject to that power. Following ample earlier authority by this Court, Gonthier J. recently reiterated this principle for the Court in Bell Canada v. Canada (Canadian Radio‑Television and Telecommunications Commission), [1989] 1 S.C.R. 1722, at p. 1744:
Where the legislator has clearly stated that the decision of an administrative tribunal is final and binding, courts of original jurisdiction cannot interfere with such decisions unless the tribunal has committed an error which goes to its jurisdiction. . . . Decisions which are so protected are, in that sense, entitled to a non‑discretionary form of deference because the legislator intended them to be final and conclusive and, in turn, this intention arises out of the desire to leave the resolution of some issues in the hands of a specialized tribunal. [Emphasis added.]
These principles are not at issue here and, as ss. 101 and 139 L.C. clearly indicate that Labour Court decisions are final, this Court will only intervene in the circumstances if the Labour Court has "committed an error which goes to its jurisdiction", according to the criteria established in earlier cases.
Facts
The appellant, Centre hospitalier Régina Ltée, is an employer operating a private institution within the system of the Quebec Ministère des Affaires sociales, which was at all times relevant to the case associated with the Syndicat national des employés de l'Hôpital Régina by the terms and conditions of a collective agreement in effect since March 27, 1980. During this period the mis‑en‑cause Cécile Montigny was an employee of the appellant, with her name on the recall list as a beneficiaries clerk. On July 30, 1981 the appellant notified Cécile Montigny in writing that, as a result of her many absences from work due to illness, it regarded her attitude as an abandonment of her position as of July 27, 1981. On August 12, 1981 the mis en cause union filed a grievance challenging what it alleged was a dismissal. As the result of various delays this grievance was not entered on the social affairs arbitration roster until June 16, 1982. Meanwhile the collective agreement, which would ordinarily have expired on December 31, 1982, was renewed until April 1, 1983 as a consequence of the Act respecting remuneration in the public sector, S.Q. 1982, c. 35, and the Act respecting the conditions of employment in the public sector, S.Q. 1982, c. 45.
The new collective agreement applicable to the parties provided that various matters would be the subject of local agreements, which meant that certain advantages and benefits were no longer automatically available to the employees affected. In March 1983, therefore, negotiations were begun between appellant and the mis en cause union with a view to concluding a general agreement enabling employees represented by the union to receive various benefits provided for in the agreement. On March 20, 1983 the parties agreed that the union would receive the various benefits set out therein. On the same day the parties signed a document prepared for the arbitration tribunals office of the social affairs sector, in which they stated that grievances then pending, including Cécile Montigny's grievance of August 12, 1981, were henceforth settled in return for a general payment of $1,672 by the employer. These agreements were filed with the office of the labour commissioner‑general in accordance with s. 72 L.C. A member of the union local stated that it did not realize one of the grievances concerned a dismissal. Cécile Montigny, who had not been told of this settlement or been involved in it, was not notified that her grievance had been discontinued until several months later.
On October 24, 1983 Cécile Montigny filed a complaint with the Minister of Labour pursuant to s. 47.3 L.C., alleging a breach by the union of its duty of fair representation, whereupon the Minister in fact appointed an investigator as provided for in that section. As no settlement was reached between Cécile Montigny and the union within the time specified by the Act after the appointment of the investigator, she filed an application under s. 47.4 L.C. asking that the Labour Court order that her claim be referred to arbitration. Judge Prud'homme granted this application on February 12, 1985, D.T.E. 85T‑254, and authorized Cécile Montigny to submit her claim against her employer to an arbitrator appointed by the Minister for decision as in the case of a grievance. It is this decision which the appellant evoked to the Superior Court pursuant to art. 846 C.C.P. The motion in evocation was dismissed by the Superior Court and that judgment was affirmed by the Court of Appeal, [1988] R.J.Q. 253: hence the present appeal.
The Arguments
The appellant makes two principal arguments in support of its appeal, one concerning jurisdiction and the other concerning interpretation.
First, it submits that the Labour Court lacked jurisdiction to order the referral to arbitration of a grievance settled by an agreement between the union and the employer. Relying on the judgment of this Court in Gendron v. Municipalité de la Baie‑James, [1986] 1 S.C.R. 401, which held that the Labour Court could not order a second arbitration of a grievance on the basis of s. 47.5 L.C., the appellant argued that the agreement settling the grievance should be given the same force as a transaction in civil law. That is, it should have the force of res judicata between the parties, so that under the rule stated in Gendron the Labour Court would lose all jurisdiction to order arbitration of the grievance. It based this comparison of the agreement to a civil transaction on the fact that the settlement must be filed by the arbitrator with the office of the labour commissioner‑general as in the case of a decision (s. 100.3 L.C.), and on the fact that labour law encourages the settlement of grievances by mutual agreement. The appellant added that the Labour Court, whose jurisdiction stricto sensu must be limited to the powers with which it is clearly vested, has no jurisdiction to set aside this bilateral civil contract and disregard the rights it confers on the employer. In the appellant's submission, the Labour Court made an error of jurisdiction in assuming this power, paving the way for intervention by the ordinary courts in the exercise of their superintending and reforming power.
Second, the appellant analyses the provisions of the Labour Code and concludes that they could not support the Court of Appeal's interpretation. Under these provisions, the union is the exclusive representative of the employees' rights and the employer's only interlocutor. Giving an employee individually the right to challenge an agreement signed by the union and to take a grievance to arbitration himself would be directly contrary to the two‑sided nature of collective labour relations. The appellant argues that ss. 47.2 to 47.6 L.C. do not support such an interpretation, which would in any case have a significant destabilizing effect on collective labour relations in general. The appellant accordingly concludes that for these reasons the decision of the Labour Court was null and void and asks that its appeal be allowed.
The respondents and the mis en cause, Cécile Montigny and the Syndicat national des employés de l'Hôpital Régina, argue on the contrary that the Labour Court had complete jurisdiction to order arbitration, even of a grievance already settled by agreement between the union and the employer.
They contend that a union's duty of fair representation exists at all stages of the negotiation and implementation of a collective agreement. According to the respondents the agreement becomes part of an independent legal system created by the provisions of the Labour Code. The rules of mandate and civil representation therefore have no application and should not be used as a guide in interpreting the provisions of this Code.
As regards the interpretation of ss. 47.2 et seq. L.C., the respondents note that the legislator intended to provide employees with an appropriate remedy to ensure performance of the union's duty set out in s. 47.2 L.C. They argue that there is no provision of the Labour Code giving the settlement of a grievance the same effect as an arbitral award and that the rules of a civil transaction clearly cannot be applied to the special situation of a union settling the grievance of an employee with an employer.
The respondents conclude that the Labour Court's decision was a valid exercise of its powers and that, in the absence of any excess of jurisdiction, there is no basis for intervention by the courts.
Judgments
Labour Court (Judge Prud'homme)
The Labour Court dismissed in limine litis the appellant's objection that the provisions of ss. 47.3 et seq. L.C. are not applicable here since the case does not involve a dismissal or disciplinary sanctions. The Court found on the contrary that this was not an abandonment of a position but rather a dismissal.
The Court had this to say regarding the argument that the settlement of grievances reached between union and employer is final:
[TRANSLATION] It should first be noted that in ss. 47.3 et seq. the legislator has not excluded from the process which may lead to a s. 47.5 authorization the situation in which there is a settlement of a grievance between the association and the employer; . . . . It is simply that the pith and substance of the jurisdiction conferred on the Court requires it to verify whether or not s. 47.2 was infringed at the time of a dismissal or disciplinary sanction, and if it finds that there has been such an infringement, to authorize the special remedy provided by s. 47.5. It can thus be seen that the setting aside of a settlement reached between the association and the employer can only take place as a result of the exercise by the Court of its jurisdiction; it cannot be in itself a subject of its jurisdiction.
It concluded:
[TRANSLATION] The Centre also vigorously argued, with supporting authority, that it must be recognized that a grievance settlement reached between the association and the employer, as here, was final and binding on the parties. The undersigned is well aware that in the normal course of events an agreement, a grievance settlement, is finally binding on the parties and closes the matter; however, it has to be admitted that since the adoption by the legislator of ss. 47.2 et seq. it is possible to force the reopening of a matter which was considered closed.
Before authorizing the remedy provided by s. 47.5 L.C., the Court weighed the merits of the complaint by Cécile Montigny against the union. It found the latter's account that it did not realize the grievance was one involving dismissal rather inconceivable. Characterizing the union's conduct as cavalier and arbitrary, the Court concluded that it had failed in its duty of fair representation, allowed the application and referred Cécile Montigny's grievance against her dismissal to an arbitrator appointed by the Minister.
Superior Court (Arsenault J.)
On a motion in evocation from the decision of judge Prud'homme, Arsenault J. concluded that the Labour Court made no [TRANSLATION] "patently unreasonable error" when it characterized the departure of the mis en cause as a dismissal rather than an abandonment within the meaning of s. 47.3 L.C. The judge held that this was not a preliminary question but one of the Labour Court's very jurisdiction and refused to review the trial judge's conclusion.
Arsenault J. rejected the argument that the "transaction" has the force of res judicata, and was of the view that the agreement concluded between the appellant and the union was not binding on Cécile Montigny. On the contrary, he said, the purpose of ss. 47.2 et seq. L.C. was to create a mechanism for controlling the union's actions to ensure that the employee's grievance was carried through to its conclusion. He wrote:
[TRANSLATION] The civil law concept binds the parties to a transaction, in this case the employer and the union, but the provisions of ss. 47.2 et seq., which are privative in nature, to some extent exclude the mandate of the union in favour of the employee, which justifies the application of the said ss. 47.2 et seq.
. . .
The Court considers that the Labour Court did not have to be concerned with the legal effects of the agreement (R‑8) in order to exercise its jurisdiction and allow the remedy provided for in ss. 47.2 et seq.
The Superior Court accordingly concluded that the Labour Court's decision was valid and dismissed the motion in evocation.
Court of Appeal (Bisson, LeBel and Lévesque (ad hoc) JJ.A.)
Bisson J.A., for the Court of Appeal, classified the respective points at issue as preliminary, fundamental and subsidiary.
He resolved the preliminary issue, concerning the way in which the termination of Cécile Montigny's employment should be characterized, by adopting in its entirety the reasoning of the Superior Court judge that this was not a pre‑jurisdictional question. The trial judge's finding could therefore only be revised if it was patently unreasonable, which was not the case here.
On the fundamental matter, the only one at issue in this Court, regarding the finality of the agreement reached between the union and the employer, which the appellant characterized as a transaction having the force of res judicata, the Court of Appeal distinguished Gendron v. Municipalité de la Baie-James, supra, and rejected the applicant's argument as follows (at p. 257):
[TRANSLATION] This is adopting a very civilist approach in an area where the legislator intended to provide a remedy where an employee feels he has not been treated properly by his union.
One of the purposes of the 1977 legislation was specifically that an employee should not be bound, as to a grievance involving him, by an agreement signed by the employer and the union without his concurrence.
No parallel can be drawn between Gendron and the case at bar.
In Gendron there was an arbitration that had been heard and disposed of by an impartial arbitrator.
In a case where before the arbitration the union and the employer settle a grievance, no third party is required to intervene and arbitrate.
I am of the view that agreement R‑8 cannot be invoked against the mis en cause.
Finally, like the Labour Court and the Superior Court, the Court of Appeal summarily rejected the appellant's subsidiary argument that Cécile Montigny had discontinued her grievance and therefore dismissed the appeal.
Analysis
The crux of the problem here, as I have already indicated, is to determine whether ss. 47.2 to 47.5 L.C. are applicable to the claim of the employee whose grievance was the subject of an agreement between the employer and the union, when the matter was before an arbitrator but there had not yet been any decision on the grievance. According to the wording of s. 47.5 L.C., the essential prerequisite for the right to arbitrate the claim is a failure by the union to perform its duty of fair representation. Only in cases where the court feels that the association has acted in bad faith or in an arbitrary or discriminatory manner, or has shown serious negligence, may it refer the claim to arbitration where there has been a dismissal or disciplinary sanction, as is the case here. The union's conduct must thus first be examined in light of the criteria set out in the Labour Code, before we discuss the applicability of the mechanism for referring the matter to arbitration as such.
I would note at the outset that the employee's claim referred to in ss. 47.4 to 47.6 L.C. is in fact his grievance against the employer. In my opinion, by using the word "claim" instead of "grievance" the legislator meant to distinguish the situation where a union is proceeding with an employee's complaint as it wishes (the "grievance") from the situation where the employee has full control over his complaint (the "claim"), and can decide, among other things, whether or not to ask that it be referred to arbitration. However, this does not mean there is any distinction as to the substance of the complaint in these two situations (Gendron v. Municipalité de la Baie‑James, supra, at p. 409 (per Chouinard J.)).
1. Duty of Fair Representation
(a) Sources of the Duty of Fair Representation
Even before the amendments to the Labour Code, including ss. 47.2 to 47.6, were introduced in 1977, an employee association had a duty of fair representation in respect of its members. This duty emerged in the decisions of the U.S. Supreme Court in mid‑century, first in Steele v. Louisville & Nashville Railroad Co., 323 U.S. 192 (1944), and culminating in Vaca v. Sipes, 386 U.S. 171 (1967). In these decisions, the Court set out the principle that an employee association's duty of fair representation is the necessary corollary of its right to exclusive representation of the employees comprised in the bargaining unit. The admission of this theory into Canadian labour law was the subject of a more detailed review in Gendron v. Supply and Services Union of the Public Service Alliance of Canada, Local 50057, [1990] 1 S.C.R. 000, (appeal heard on the same day), and it is therefore unnecessary to repeat the analysis here. Suffice it to say that the existence of such a duty imposed on unions was recognized and applied by Canadian courts before its codification, inter alia by this Court in Canadian Merchant Service Guild v. Gagnon, [1984] 1 S.C.R. 509.
(b) Codification in Labour Code
The Quebec Labour Code brings together all or most of the principles and rules applicable to collective labour relations in Quebec, such as the formation and certification of unions, the principle of exclusive representation, the procedure for negotiating collective agreements, the settlement of grievances, and finally, available recourses to specialized administrative tribunals. This Code is in fact an exhaustive document which, when it was adopted, replaced a heterogeneous collection of legislation and which has anchored the collective agreements containing most of the substantive rights of employees (see F. Morin, Rapports collectifs du travail (1982), at pp. 19‑26).
In 1977 the Quebec legislator undertook a significant reorganization of collective labour relations, giving increased rights both to unions ‑- for example, prohibiting strikebreakers (ss. 109.1 et seq. L.C.) and introducing a system of compulsory check‑off of union dues by source deductions (s. 47 L.C.) -‑ and to employees individually -‑ for example, the right to see the union's financial statements (s. 47.1 L.C.) and the guarantee of employment for an employee who is not a member of the union when a closed shop clause comes into effect (s. 63(a) L.C.) One of the major changes, which is of particular importance here, was the introduction of ss. 47.2 to 47.6 L.C., codifying the union's duty of fair representation and in return giving the employee a remedy in certain situations when this duty is breached.
The duty of fair representation as codified in s. 47.2 L.C. does not differ greatly from that formulated by the courts prior to 1977. In Gagnon, supra, Chouinard J. analyzed the duty of fair representation as it had developed at common law, and the duty as it was later codified in the Canada Labour Code, R.S.C. 1970, c. L‑1 (s. 136.1), the British Columbia Labour Code, R.S.B.C. 1979, c. 212 (s. 7(1)), the Ontario Labour Relations Act, R.S.O. 1980, c. 228 (s. 68) and finally s. 47.2 L.C. of Quebec. He concluded that s. 47.2 L.C. is identical in content to what the courts and authors had developed before its codification in various Canadian statutes. As Robert P. Gagnon wrote in his recent work (Droit du travail (1988), in Cours de la formation professionnelle du Barreau du Québec, 1988‑1989, vol. 6, at p. 104:
[TRANSLATION] By adopting s. 47.2 of the Labour Code in 1977 the Quebec legislator finally, after several others had done so, codified the law resulting from court judgments regarding a certified union's legal duty of representation.
In my opinion the scheme established by ss. 47.3 to 47.6 L.C. provides the method which the legislator felt was necessary to enforce a union's duty of fair representation, thereby ensuring a proper balance of reciprocal obligations and rights. While the Canada Labour Relations Board enjoys some leeway regarding remedies when a union breaches its duty of fair representation (ss. 187 to 189 of the Canada Labour Code ), the Quebec legislator has established a specific structure setting out the stages in any remedy based on such a breach. The first stage consists of a complaint to the Minister of Labour, who then appoints an investigator to try to settle the dispute between employee and union by mutual agreement (s. 47.3 L.C.) It should be noted that the legislator has limited the use of this procedure to cases of dismissal or disciplinary sanction, in other words the most serious interferences with an employee's rights. In the second stage, if no agreement is reached within fifteen days of the investigator's appointment (a period increased to thirty days by S.Q. 1983, c. 22, s. 24), the employee may file an application with the Labour Court asking that his claim be referred to arbitration (s. 47.4 L.C.) Finally, if on reviewing this application the Court finds that the union has acted in an arbitrary or discriminatory manner, been seriously negligent or acted in bad faith, the burden of proof of which is on the employee, it may authorize arbitration of the claim (s. 47.5 L.C.) A finding that the duty of fair representation has been breached is thus the central feature of such a remedy. Section 47.6 L.C. provides that in such a case an employer cannot invoke against the employee the failure to observe the time limits provided for in the collective agreement.
(c) Fair Representation and Settlement of Grievances
The duty of fair representation raises thorny problems when, as here, by its very function the union has an obligation to defend the interests of members of the bargaining unit as a whole, as well as those of an individual employee. These interests can be and often are indeed divergent.
In this connection I should say at the outset that a union's duty of fair representation does not cease in relation to a grievance proceeding once the grievance has gone to arbitration. It may continue even after the arbitrator's final decision (for example, in Asselin v. Travailleurs amalgamés du vêtement et du textile, local 1838, [1985] T.T. 74, at p. 93, where the Labour Court concluded the union had a duty to evoke the arbitrator's erroneous decision), subject to Gendron v. Municipalité de la Baie‑James, supra, which held that in such a case the s. 47.5 L.C. procedure could not be applied. As Gagnon, LeBel and Verge point out, this duty of fair representation, as a corollary of the exclusive right of representation, must inform all the union's action throughout (Robert P. Gagnon, Louis LeBel and Pierre Verge, Droit du travail (1987), at p. 311):
[TRANSLATION] The duty of representation will end with the loss of certification. Until that happens, the union will be held to it at all stages of the collective representation, both in negotiating the content of the collective agreement and in its implementation as it affects one or other of the employees.
There is thus no question that at the stage the grievance was at in the case at bar, that is, set for hearing but not yet heard by the arbitrator, the union's duty of diligence still existed.
In Gagnon, supra, this Court announced the general principles that should govern an employee association (or union) when it is acting as the representative of an employee in a grievance proceeding. The case involved the Canada Labour Code (before the introduction of s. 136.1 expressly imposing a duty