Canada (Attorney General) v. National Police Federation

Canada (Attorney General) v. National Police Federation
Court (s) Database
Federal Court of Appeal Decisions
Date
2022-05-13
Neutral citation
2022 FCA 80
File numbers
A-123-20
Notes
A correction was made on March 27th, 2024.
Reported Decision
Decision Content
Date: 20220513
Docket: A-123-20
Citation: 2022 FCA 80
CORAM:
STRATAS J.A.
WEBB J.A.
GLEASON J.A.
BETWEEN:
ATTORNEY GENERAL OF CANADA
Applicant
and
NATIONAL POLICE FEDERATION
Respondent
Heard at Ottawa, Ontario, on October 26, 2021.
Judgment delivered at Ottawa, Ontario, on May 13, 2022.
REASONS FOR JUDGMENT BY:
GLEASON J.A.
CONCURRED IN BY:
STRATAS J.A. WEBB J.A.
Date: 20220513
Docket: A-123-20
Citation: 2022 FCA 80
CORAM:
STRATAS J.A.
WEBB J.A.
GLEASON J.A.
BETWEEN:
ATTORNEY GENERAL OF CANADA
Applicant
and
NATIONAL POLICE FEDERATION
Respondent
REASONS FOR JUDGMENT
GLEASON J.A.
[1] Labour legislation in all Canadian jurisdictions imposes a freeze on the terms and conditions of employment of bargaining unit employees. The freeze prevents employers from unilaterally altering the terms and conditions following the filing of an application for certification or provision of notice to bargain for the employees’ bargaining unit. The Federal Public Sector Labour Relations Act, S.C. 2003, c. 22, s. 2 (the FPSLRA) contains such statutory freeze provisions. One, in section 56, applies after an employer has been advised that an application for certification has been made. This is sometimes called a “certification freeze”. Another, in section 107, applies after notice to bargain has been given. This is sometimes called a “bargaining freeze”.
[2] Canadian labour boards, including the Federal Public Sector Labour Relations and Employment Board and its predecessors (collectively, the Board) have long interpreted statutory freeze provisions like these as requiring a dynamic as opposed to a static freeze. They accordingly have held that statutory freeze provisions permit – and sometimes require – an employer to continue to operate in accordance with its prior pattern of operations (including by continuing to implement decisions made and announced to employees before the onset of the freeze period) or, in some instances, in the absence of such a pattern, in accordance with the way in which employees could reasonably anticipate. The case law has recognized these approaches as encompassing a “business as before” or “business as usual” test and a “reasonable employee expectation” test.
[3] Labour boards have also held that the freeze provisions are designed to provide trade unions a stable substratum of wages and working conditions from which to bargain and that the certification freeze also operates to prevent erosion of support for a trade union following certification. Thus, as noted by the respondent at paragraph 31 of its memorandum of fact and law, freeze provisions have “… a symbiotic relationship with the duty to recognize a union and bargain in good faith.”
[4] In this application for judicial review, the applicant seeks to set aside the decision of the Board in National Police Federation v. Treasury Board, 2020 FPSLREB 44. In that decision, the Board found that the employer had violated the statutory freeze contained in s. 56 of the FPSLRA by unilaterally implementing a change in employee eligibility for promotion in circumstances where the decision to make the change was reached by the employer after the commencement of the freeze period and was communicated to employees after the onset of the freeze. In so deciding, the Board followed and applied a long line of case law of its own and from other labour boards regarding the interpretation of statutory freeze provisions.
[5] The applicant submits that in so deciding, the Board reached an unreasonable determination because the result is at odds with the decision of the Supreme Court of Canada in United Food and Commercial Workers, Local 503 v. Wal‑Mart Canada Corp., 2014 SCC 45, [2014] 2 S.C.R. 323 [Wal-Mart], which the applicant submits fundamentally changes the interpretation of statutory freeze provisions. The applicant says that, by virtue of the decision of the Supreme Court of Canada in Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65, 441 D.L.R. (4th) 1 [Vavilov], the failure to follow Wal-Mart means that the Board’s decision is unreasonable and must be set aside.
[6] The applicant further submits that the Board improperly reversed the onus of proof and reached an unreasonable factual determination when it concluded that the decision in question was not made until after the onset of the freeze period. The applicant also says that the Board violated its procedural fairness rights in addressing this issue because the date the decision was made was not contested before the Board.
[7] I disagree with the applicant on all points, and for the reasons that follow, would dismiss this application, with costs.
I. Background and the Decision of the Board [8] It is useful to commence by setting out the applicable statutory provisions.
[9] Section 56 of the FPSLRA (the certification freeze provision in the FPSLRA) provided as follows at the times relevant to this application:
56 After being notified of an application for certification made in accordance with this Part, the employer may not, except under a collective agreement or with the consent of the Board, alter the terms and conditions of employment that are applicable to the employees in the proposed bargaining unit and that may be included in a collective agreement until
56 Après notification d’une demande d’accréditation faite en conformité avec la présente partie, l’employeur ne peut modifier les conditions d’emploi applicables aux fonctionnaires de l’unité de négociation proposée et pouvant figurer dans une convention collective, sauf si les modifications se font conformément à une convention collective ou sont approuvées par la Commission. Cette interdiction s’applique, selon le cas :
(a) the application has been withdrawn by the employee organization or dismissed by the Board; or
a) jusqu’au retrait de la demande par l’organisation syndicale ou au rejet de celle-ci par la Commission;
(b) 30 days have elapsed after the day on which the Board certifies the employee organization as the bargaining agent for the unit.
b) jusqu’à l’expiration du délai de trente jours suivant la date d’accréditation de l’organisation syndicale.
[10] As the Board noted in the decision under review, section 56 was subsequently amended, but these amendments are not germane to this application.
[11] The instant case was the first time the Board interpreted s. 56 of the FPSLRA, which came into force in 2005. The Board had not previously been called upon to interpret s. 56 of the FPSLRA, likely because there have been relatively few certification applications in the federal public sector in recent years, which has been heavily unionized for some time. However, the Board has interpreted s. 107 of the FPSLRA, the bargaining freeze, in many cases prior to the decision under review. Section 107 of the FPSLRA currently provides:
107 Unless the parties otherwise agree, and subject to section 132, after the notice to bargain collectively is given, each term and condition of employment applicable to the employees in the bargaining unit to which the notice relates that may be included in a collective agreement, and that is in force on the day the notice is given, is continued in force and must be observed by the employer, the bargaining agent for the bargaining unit and the employees in the bargaining unit until a collective agreement is entered into in respect of that term or condition or
107 Une fois l’avis de négocier collectivement donné, sauf entente à l’effet contraire entre les parties aux négociations et sous réserve de l’article 132, les parties, y compris les fonctionnaires de l’unité de négociation, sont tenues de respecter chaque condition d’emploi qui peut figurer dans une convention collective et qui est encore en vigueur au moment où l’avis de négocier a été donné, et ce, jusqu’à la conclusion d’une convention collective comportant cette condition ou :
(a) if the process for the resolution of a dispute is arbitration, an arbitral award is rendered; or
a) dans le cas où le mode de règlement des différends est l’arbitrage, jusqu’à ce que la décision arbitrale soit rendue;
(b) if the process for the resolution of a dispute is conciliation, a strike could be declared or authorized without contravening subsection 194(1).
b) dans le cas où le mode de règlement des différends est le renvoi à la conciliation, jusqu’à ce qu’une grève puisse être déclarée ou autorisée, le cas échéant, sans qu’il y ait contravention au paragraphe 194(1).
[12] In the decision under review, the Board held that its case law interpreting s. 107 of the FPSLRA was relevant under s. 56 because similar principles apply to the two statutory freeze provisions (at para. 45).
[13] Neither party disputes the applicability of case law arising under s. 107 to cases involving an alleged breach of s. 56 of the FPSLRA. Indeed, other labour boards have also followed this approach and sometimes have applied their case law from bargaining-freeze cases in certification-freeze cases (see, e.g., Union of Bank Employees, Locals 2104 & 2100 v. Canadian Imperial Bank of Commerce, [1980] 1 Can. L.R.B.R. 307, 1979 CarswellNat 725; I.B. of T.C.W. & H. of A., Local 362 v. Mid-Continental Tank Lines Inc., 12 C.L.R.B.R. (N.S.) 138, 1986 CarswellNat 908; S.P.A.T.E.A. v. Spar Aerospace Products Ltd. [1978] O.L.R.B.R. 859, 1978 CarswellOnt 1117, as well as the reasons of the Board in this case at para. 45.)
[14] The facts giving rise to this application are discussed at length in the Board’s decision, and, for purposes of these Reasons, it is necessary to only briefly outline them.
[15] The dispute in this case arose between the Treasury Board (which was named as the employer before the Board) and the National Police Federation (the Federation). On April 18, 2017, the Federation applied to the Board for certification as the bargaining agent for a bargaining unit composed of Royal Canadian Mounted Police (RCMP) regular members and reservists. RCMP members were not previously unionized, having been excluded from collective bargaining prior to the amendments to the FPSLRA made in 2017 in the wake of the decision of the Supreme Court of Canada in Mounted Police Association of Ontario v. Canada (Attorney General), 2015 SCC 1, [2015] 1 S.C.R. 3.
[16] The certification freeze remained in effect until 30 days following the certification of the Federation on July 12, 2019 (see National Police Federation v. Treasury Board, 2019 FPSLREB 74).
[17] While the Federation’s certification application was still pending and the certification freeze was in place, the RCMP made the impugned change to its promotion policy. It had previously made only one other somewhat similar change to the policy.
[18] Prior to the change at issue in the case at bar, RCMP Sergeants could apply to be promoted to the rank of Staff Sergeant and Corporals to the rank of Sergeant before completing the RCMP’s Management Development Program or Supervisor Development Program. The Management Development Program and Supervisor Development Program take twelve months to complete and involve pre-class online learning, several days of in-class instruction and application in the workforce.
[19] On November 20, 2017, while the certification freeze was still in force, the RCMP amended its Career Management Manual (the promotion policy) to require Sergeants promoted after March 31, 2018 to complete the Management Development Program before applying for promotion to the rank of Staff Sergeant and Corporals promoted after March 31, 2019 to complete the Supervisor Development Program before applying for promotion to the rank of Sergeant.
[20] The employer did not advise bargaining unit members or the Federation of the change before it was made and did not seek the consent of the Board to the change. Bargaining unit members and the Federation were unhappy with the change to the promotion policy, which many felt would unfairly restrict access to promotions due to an inability to access the Management Development Program and Supervisor Development Program. This was of particular concern to specialized staff and those working in remote areas with smaller detachments, where it was less likely they could be released to participate in the Management Development Program and Supervisor Development Program courses due to operational requirements. On February 15, 2018, the Federation filed a complaint with the Board, alleging a violation of s. 56 of the FPSLRA.
[21] Before the Board, the employer made two principal arguments.
[22] First, it asserted, on a factual basis, that it had reached a decision to implement the impugned policy change before the onset of the freeze period during a June 27, 2016 Senior Executive Committee (SEC) meeting.
[23] Second, it asserted that the Board was required to follow the decision of the Supreme Court of Canada in Wal-Mart, which required a dismissal of the Federation’s application. More specifically, the employer alleged that Wal-Mart allows implementation of unilateral employer changes to wages and working conditions when a statutory freeze is in force so long as “the wheels are set in motion” among members of management to make the change before the freeze commenced or where the change is one a reasonable employer would make. According to the employer, the Supreme Court of Canada determined in Wal-Mart that reasonable employee expectations are irrelevant under the business as usual approach to the freeze because the two tests are separate and distinct. Therefore, the appellant asserted that, subsequent to the decision in Wal-Mart, it is unnecessary that an impending change be disclosed to employees or their union before the freeze commences, even in the absence of any prior pattern of making similar changes, so long as the “wheels were set in motion” to make the change before the freeze started. Because it claimed that a decision to implement the change to the RCMP promotion policy had been made before the onset of the certification freeze, the employer asserted that it was free to make the change in question.
[24] The Board disagreed with the employer’s arguments.
[25] It found, as a matter of fact, that the decision to make the impugned change was made at the earliest on October 23, 2017, when the change was approved, which was well after the certification freeze commenced.
[26] Contrary to what the applicant submits, the parties did join issue on the date the impugned change was made. In its application and written submissions, the Federation took the position that the impugned change to the RCMP’s promotion policy was made on November 20, 2017, the date the RCMP amended its policy manual. The employer admitted that this was the relevant date in the response it filed with the Board, but in its case before the Board altered that position and called evidence to try to establish that the decision was made at the June 27, 2016 SEC meeting.
[27] While the parties’ arguments before the Board appear to have focused mostly on the implications of the decision in Wal-Mart, the date of the impugned change was very much in issue before the Board. This is seen from the Federation’s application and the written submissions it filed with the Board.
[28] On the date of the impugned change, the Board noted that the employer had declined to call any member of the SEC to testify about what was decided during the June 27, 2016 SEC meeting. It found that the documentary record of the decisions made at that meeting did not reflect a decision to require completion of the Management Development Program or Supervisor Development Program as a condition for applying for promotion. On this point, as it was entitled to do, the Board did not accept the testimony of an employer witness who had attended the meeting. It instead relied on the documentary evidence and other evidence, which supported the conclusion that the decision to amend the RCMP’s promotion policy was made after the certification freeze was in operation.
[29] In support of this finding, the Board noted that, subsequent to the June 27, 2016 SEC meeting, feedback was sought from less senior members of management about the proposed change to the promotion policy, and that much of that feedback was critical of the proposed change. The Board also noted that the change had been put on hold at one point and that no explanation was offered as to why this had happened. In addition, the Board found that the policy was drafted and re-drafted until a final text was settled on October 23, 2017. The Board further noted that, in some cases, the back and forth of re-drafting the policy amendments involved substantive issues, which continued to be debated and discussed by senior members of RCMP management over the period between June 27, 2016 and October 23, 2017. The Board thus determined that the decision to make the impugned change to the promotion policy was not reached until October 23, 2017, at the earliest, which was well after the certification freeze was in operation.
[30] On the interpretive point involving the decision in Wal-Mart, the Board rejected the argument advanced by the employer and found that the Supreme Court of Canada had not changed the principles applicable to statutory freeze complaints in the way the employer suggested. The Board undertook a lengthy review of the decision in Wal-Mart, its own case law, and the case law of several other labour boards, many of which have applied a reasonable employee expectation test in circumstances similar to those in the case at bar.
[31] Just as in those cases, the Board concluded that the impugned policy change could not have been reasonably anticipated by employees in the absence of any prior pattern of making similar changes or in the absence of any communication to them about the impending change prior to the onset of the statutory freeze. It also found that the employer could not rely on the business as usual exception in the absence of a prior practice of making similar changes or notification to employees before the freeze commenced.
[32] The Board noted that arguments like those advanced by the employer had been rejected by other labour boards. It also found that if the employer’s argument were accepted, it would “…mean ignoring decades of labour board jurisprudence…” (at para. 74). The Board therefore rejected the employer’s argument regarding the import of the Supreme Court of Canada’s decision in Wal-Mart.
[33] The Board concluded that the employer had violated s. 56 of the FPSLRA and issued remedial orders. These required the employer to:
a. allow RCMP Corporals and Sergeants to apply for promotions to the ranks of Sergeant and Staff Sergeant, respectively, without completing the Supervisor Development Program or Management Development Program;
b. identify the employees who were screened out of promotions to the ranks of Sergeant and Staff Sergeant, respectively, because they had not completed the Supervisor Development Program or Management Development Program and reassess any such employee for that promotion, regardless of his or her completion of the Supervisor Development Program or Management Development Program;
c. complete the identification and reassessment and report the results to the Federation within 120 days; and
d. pay any employee identified as a result of that identification and reassessment who is entitled to a promotion all lost wages and benefits that the employee would have received had he or she been promoted but for the violation of s. 56 of the FPSLRA.
II. Analysis [34] The reasonableness standard of review applies to review of the Board’s decisions. As for procedural fairness, while there is some debate in this Court, the most frequently expressed view at this time is that it is for this Court to determine whether the Board violated an applicant’s procedural fairness rights (see, e.g., Canada (Attorney General) v. Alexis, 2021 FCA 216, [2021] CarswellNat 4869 at para. 2; Gulia v. Canada (Attorney General), 2021 FCA 106, 2021 CarswellNat 1617 at para. 8; Canadian Pacific Railway Company v. Canada (Attorney General), 2018 FCA 69, [2019] 1 F.C.R. 121 at para. 54).
A. Was there a denial of procedural fairness? [35] I turn first to examine the alleged violation of procedural fairness arising from the determination that the impugned change to the RCMP’s promotion policy was not made until after the onset of the certification freeze. In light of the allegations made in the Federation’s application and written submissions, the date the impugned change was reached was very much a live issue before the Board. Thus, the applicant cannot claim to have been taken by surprise when the Board ruled on the issue. Therefore, I find there to have been no denial of procedural fairness.
B. Did the Board reverse the onus of proof? [36] I turn next to the applicant’s claim that the Board improperly reversed the onus of proof.
[37] The Board’s case law recognizes that, in the context of a s. 107 complaint, an applicant union must establish that: (1) a condition of employment existed on the day the freeze commenced; (2) the condition was changed without the consent of the bargaining agent; (3) the change was made during the freeze period; and (4) the condition is one that is capable of being included in a collective agreement. The Board has stated that the focus then shifts to any defence the employer may have offered. In Public Service Alliance of Canada v. Canada Revenue Agency, 2019 FPSLREB 110, the Board stated as follows at paragraph 137:
[137] In cases involving s. 107, the Board often conducts what is, in effect, a two-stage analysis. First, it tests whether a complainant has met its principal evidentiary burden of establishing that notice to bargain was served, that an employer subsequently changed a term and condition of employment that might have been included in a collective agreement and that was in force on the date notice to bargain was served, and that the complainant did not consent to that change. In the second stage, the Board considers any defence offered by the employer that despite the fact of a change in a term and condition of employment within the meaning of s. 107, its action did not comprise a violation of s. 107, most often because it was conducting “business as usual”. In some cases, the Board views business as usual as an approach permitting a complainant to discharge its burden of proof by demonstrating that a term and condition of employment was in place before notice to bargain was served but subsequently was changed by the employer, in violation of s. 107.
[38] Contrary to what the applicant asserts, a fair reading of the Board’s reasons demonstrates that it did not stray from these principles in the decision under review or cast the burden on the employer. Indeed, it made its evidentiary determinations based on all the evidence it heard, and the question of which party bore the onus of proof did not play any role in its decision.
[39] Therefore, I conclude that the Board did not commit a reviewable error concerning the burden of proof.
C. Was the Board’s factual determination reasonable? [40] I turn next to consider whether the Board’s factual determination that the impugned change was not made until after the commencement of the freeze period was reasonable. Given the ample evidence before the Board upon which it relied to support its determination that the decision to implement the change was not reached until October 23, 2017, this determination was entirely reasonable.
[41] Contrary to what the applicant asserts, the Board was not required to accept the evidence from an employer witness who testified as to the nature of the decision made at the June 27, 2016 SEC meeting and the authority of the SEC. It was open to the Board to instead rely on other evidence, which supported its conclusion that the decision to amend the promotion policy was not made until after the certification freeze had commenced.
[42] As the Board suggested at paragraph 131 of its decision, its conclusion concerning the date the decision was made, in and of itself, provided a sufficient basis for granting the complaint because the employer had not “set the wheels in motion” before the onset of the statutory freeze period. Thus, as the respondent rightly submits, my conclusion that this factual determination was a reasonable one requires that this application for judicial review be dismissed. Therefore, strictly speaking, it is not necessary to address the parties’ arguments regarding the import of the Wal-Mart decision.
[43] Despite this, I believe it important that I do so in light of the nature of those arguments, which, if accepted, would mark a radical change in the way most labour boards have applied statutory freeze provisions over the last several decades.
D. Was the Board’s interpretation of the decision of the Supreme Court of Canada in Wal-Mart reasonable? [44] As noted, the applicant makes two interconnected submissions with respect to the reasonableness of the Board’s interpretation of the decision in Wal-Mart. It first submits that the Supreme Court of Canada held in Vavilov that failure to apply an applicable precedent renders a decision unreasonable and, second, that the Board failed to follow Wal-Mart, which it was bound to do.
[45] I disagree with both assertions.
(1) Impact of a Departure from Precedent [46] As concerns the administrative law point, contrary to what the applicant submits, the Supreme Court of Canada did not establish a bright line test in Vavilov, which would require that failure to follow a case law precedent must necessarily result in an administrative decision being set aside. Quite the contrary, the Supreme Court’s approach in Vavilov to the role of precedent is much more nuanced and contextual.
[47] In this regard, the Court in Vavilov dealt with the impact of a failure to follow two types of precedents, namely, those from the administrative decision-maker, itself, and those from the courts.
[48] When dealing with the administrative decision-maker’s own precedents, the Supreme Court held that an administrative decision-maker may sometimes reasonably depart from them if it provides adequate reasons for so doing. At paragraphs 131-132, the majority stated:
[131] Whether a particular decision is consistent with the administrative body’s past decisions is also a constraint that the reviewing court should consider when determining whether an administrative decision is reasonable. Where a decision maker does depart from longstanding practices or established internal authority, it bears the justificatory burden of explaining that departure in its reasons. If the decision maker does not satisfy this burden, the decision will be unreasonable. In this sense, the legitimate expectations of the parties help to determine both whether reasons are required and what those reasons must explain: Baker, at para. 26. We repeat that this does not mean administrative decision makers are bound by internal precedent in the same manner as courts. Rather, it means that a decision that departs from longstanding practices or established internal decisions will be reasonable if that departure is justified, thereby reducing the risk of arbitrariness, which would undermine public confidence in administrative decision makers and in the justice system as a whole.
[132] As discussed above, it has been argued that correctness review would be required where there is “persistent discord” on questions on law in an administrative body’s decisions. While we are not of the view that such a correctness category is required, we would note that reviewing courts have a role to play in managing the risk of persistently discordant or contradictory legal interpretations within an administrative body’s decisions. When evidence of internal disagreement on legal issues has been put before a reviewing court, the court may find it appropriate to telegraph the existence of an issue in its reasons and encourage the use of internal administrative structures to resolve the disagreement. And if internal disagreement continues, it may become increasingly difficult for the administrative body to justify decisions that serve only to preserve the discord.
[49] As concerns departure from judicial precedents, the Supreme Court also held that, providing adequate explanations are given, an administrative decision-maker may sometimes decline to follow a decision from the courts, depending on the circumstances. The inquiry is an inherently contextual one; the degree to which a precedent will constrain the administrative decision-maker will depend on the nature of the precedent and the reasons for declining to follow it given by the administrative decision-maker. The majority stated at paragraphs 112-113 of Vavilov:
[112] Any precedents on the issue before the administrative decision maker or on a similar issue will act as a constraint on what the decision maker can reasonably decide. An administrative body’s decision may be unreasonable on the basis that the body failed to explain or justify a departure from a binding precedent in which the same provision had been interpreted. Where, for example, there is a relevant case in which a court considered a statutory provision, it would be unreasonable for an administrative decision maker to interpret or apply the provision without regard to that precedent. The decision maker would have to be able to explain why a different interpretation is preferable by, for example, explaining why the court’s interpretation does not work in the administrative context: M. Biddulph, “Rethinking the Ramification of Reasonableness Review: Stare Decisis and Reasonableness Review on Questions of Law” (2018), 56 Alta. L.R. 119, at p. 146. There may be circumstances in which it is quite simply unreasonable for an administrative decision maker to fail to apply or interpret a statutory provision in accordance with a binding precedent. For instance, where an immigration tribunal is required to determine whether an applicant’s act would constitute a criminal offence under Canadian law (see, e.g., Immigration and Refugee Protection Act, S.C. 2001, c.27, ss.35-37), it would clearly not be reasonable for the tribunal to adopt an interpretation of a criminal law provision that is inconsistent with how Canadian criminal courts have interpreted it.
[113] That being said, administrative decision makers will not necessarily be required to apply equitable and common law principles in the same manner as courts in order for their decisions to be reasonable. For example, it may be reasonable for a decision maker to adapt a common law or equitable doctrine to its administrative context: see Nor-Man Regional Health Authority, at paras. 5-6, 44-45, 52, 54 and 60. Conversely, a decision maker that rigidly applies a common law doctrine without adapting it to the relevant administrative context may be acting unreasonably: see Delta Air Lines, at paras. 16-17 and 30. In short, whether an administrative decision maker has acted reasonably in adapting a legal or equitable doctrine involves a highly context-specific determination.
[50] Thus, if the Board failed to follow the decision of the Supreme Court of Canada in Wal-Mart and provided an adequate explanation for doing so, it would not necessarily render its decision in the case at bar unreasonable.
[51] In deciding when an administrative decision-maker may decline to follow a judicial precedent, the Federation submits that that the decision of the Federal Court in Service d'administration P.C.R. Ltée v. Reyes, 2020 FC 659 (per Grammond, J.) [P.C.R. Ltée] provides a useful analytical approach. There, the Federal Court held that, in assessing the binding nature of a precedent, the reviewing court should first assess the degree of legal constraint attaching to the precedent and then assess the reasonableness of the decision in light of the nature of that constraint. The Federal Court outlined its approach as follows at paragraph 24 of P.C.R. Ltée:
… when a court analyzes a claim that an administrative decision-maker applied the “wrong test” by departing from a precedent, be it judicial or administrative, the following method is useful:
1. The Court must assess the degree of legal constraint imposed by the precedent, which involves the following factors:
(a) The position of the author of the precedent in the judicial or administrative hierarchy;
(b) The degree of consensus about the alleged precedent;
(c) If the precedent was a decision on an application for judicial review, whether other outcomes could be deemed reasonable; and
(d) The fact that, in order to decide the question that would be governed by the precedent, the decision-maker has to weigh a range of factors;
2. The Court must then determine whether the impugned decision is reasonable, which, depending on the circumstances, may raise the following questions:
(a) If the decision maker explicitly disregarded the precedent, did they give adequate reasons?
(b) Taken as a whole, is the decision incompatible with the alleged precedent?
[52] With respect, I do not find this analytical framework a useful one to prescribe as it commences from the wrong starting point and is overly Cartesian. I also fear this formula would lead to the compartmentalization of a list of factors for a reviewing court to consider in all cases, even where this may not be necessary or appropriate. Moreover, this approach contradicts the approach mandated by Vavilov, where the Supreme Court held that the required analysis involves a highly context-specific determination – the antithesis of a list of factors applied in a mechanistic way. In my view, it is undesirable to prescribe an analytical methodology that will fit all cases beyond the general outlines the Supreme Court provided in Vavilov.
[53] Vavilov teaches that the focus of the review must be consideration of the reasons of the administrative decision-maker, where reasons are given. At paragraphs 82-84, the majority in Vavilov stated:
[82] Reasonableness review aims to give effect to the legislature’s intent to leave certain decisions with an administrative body while fulfilling the constitutional role of judicial review to ensure that exercises of state power are subject to the rule of law: see Dunsmuir, at paras. 27-28 and 48; Catalyst Paper Corp. v. North Cowichan (District), 2012 SCC 2, [2012] 1 S.C.R. 5, at para. 10; Reference re Remuneration of Judges of the Provincial Court of Prince Edward Island, [1997] 3 S.C.R. 3, at para. 10.
[83] It follows that the focus of reasonableness review must be on the decision actually made by the decision maker, including both the decision maker’s reasoning process and the outcome. The role of courts in these circumstances is to review, and they are, at least as a general rule, to refrain from deciding the issue themselves. Accordingly, a court applying the reasonableness standard does not ask what decision it would have made in place of that of the administrative decision maker, attempt to ascertain the “range” of possible conclusions that would have been open to the decision maker, conduct a de novo analysis or seek to determine the “correct” solution to the problem. The Federal Court of Appeal noted in Delios v. Canada (Attorney General), 2015 FCA 117, 472 N.R. 171, that, “as reviewing judges, we do not make our own yardstick and then use that yardstick to measure what the administrator did”: at para. 28; see also Ryan, at paras. 50-51. Instead, the reviewing court must consider only whether the decision made by the administrative decision maker — including both the rationale for the decision and the outcome to which it led — was unreasonable.
[84] As explained above, where the administrative decision maker has provided written reasons, those reasons are the means by which the decision maker communicates the rationale for its decision. A principled approach to reasonableness review is one which puts those reasons first. A reviewing court must begin its inquiry into the reasonableness of a decision by examining the reasons provided with “respectful attention” and seeking to understand the reasoning process followed by the decision maker to arrive at its conclusion: see Dunsmuir, at para. 48, quoting D. Dyzenhaus, “The Politics of Deference: Judicial Review and Democracy”, in M. Taggart, ed., The Province of Administrative Law (1997), 279, at p. 286.
[54] Thus, on issues regarding the impact of precedent, as any other issue in judicial review, the reviewing court’s analysis must be focussed on the reasons the administrative decision-maker gave for interpreting or declining to follow a precedent. As part of this inquiry, the precedent at issue must be understood in the context of the case in which it arose and within its place in the broader case law. In understanding this context, the reasons given by the administrative decision-maker on these points are of central importance, especially where, as here, the judicial precedent falls within the heartland of the administrative decision-maker’s area of expertise.
(2) The Board’s Treatment of Wal-Mart [55] With this background in mind, I turn to assess the reasonableness of the Board’s treatment of the decision of the Supreme Court of Canada in Wal-Mart and, as directed by Vavilov, commence my analysis with a more detailed review of what the Board said about the Wal-Mart decision in its reasons. Because they are so thoughtful and so thoroughly review the relevant issues, it is worthwhile commenting at some length on the Board’s reasons.
(a) Detailed Review of the Board’s Reasons [56] The Board commenced its consideration of the employer’s argument by noting that “it has long been accepted in the jurisprudence of this and other labour boards that … some changes may be made without violating [a statutory freeze provision], if they are business as usual for the employer or if they are within the employees’ reasonable expectations or both” (at para. 49).
[57] The Board then set out its conclusion on the employer’s argument at paragraphs 50-51, stating:
[50] The employer argues that the two tests are distinct and that employees’ expectations cannot be considered in a business-as-usual analysis. It adds that intermingling them not only runs counter to the way they developed historically but also was confirmed as wrong by the Supreme Court of Canada’s approach in the Wal-Mart decision.
[51] I have to disagree with the employer on both counts. Jurisprudence that applies these two analytical approaches in a complementary and interconnected way is entirely in line with how they developed historically. Furthermore, I see nothing in Wal-Mart that changes that or that even suggests that an assessment of employees’ expectations should not form part of a business-as-usual analysis.
[58] In the subsequent sections of its decision, the Board set out the reasons for this conclusion.
[59] The Board began with a historical overview of the case law interpreting statutory freeze provisions. It noted that labour boards initially developed the business as usual test and rejected the notion of a static freeze in recognition of employers’ needs to continue to run their businesses during freeze periods, which sometimes may be lengthy. The Board went on to state that “analyzing when a change breaches a freeze provision is not an exact science” and that the “business as usual test has not proved helpful in every situation” (at para. 53). The Board noted that labour boards accordingly developed the reasonable employee expectation test, which the Board stated, “was not a recent development” (at para. 55).
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