Supreme Court of Canada Extends Labour Arbitration Jurisdiction to Human Rights Dispute

Written on behalf of Peter McSherry
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Last week, the Supreme Court of Canada released a decision in which it ruled that a unionized employee’s claim of discrimination should be heard by an arbitrator, rather than a human rights adjudicator.

Employee Fired for Alcohol Consumption

The employee was part of a union.

In 2011, she was suspended by the employer for attending work under the influence of alcohol. She subsequently disclosed to the employer that she had an addiction to alcohol. The employer offered to enter into a “last chance agreement” with her wherein she would be required to abstain from alcohol and engage in addiction treatment.

After the employee refused to sign the agreement, she was fired.

However, the union filed a grievance and she was reinstated by the arbitrator under similar terms to those in the agreement.

Shortly thereafter, she was fired again for an alleged breach of those terms.

Employee Files Complaint of Discrimination

Following her second termination, the employee filed a complaint with the Manitoba Human Rights Commission (the “Commission”) alleging that the employer had failed to sufficiently accommodate her disability as it related to her alcohol addiction.

The complaint was heard by an adjudicator appointed under Manitoba’s Human Rights Code. However, the employer objected to the adjudicator’s jurisdiction, arguing that the 1995 Supreme Court of Canada Weber v. Ontario Hydro had recognized the exclusive jurisdiction of an arbitrator appointed under a collective agreement, and that exclusive arbitral jurisdiction extended to human rights complaints arising from a unionized workplace.

Adjudicator Rules on Jurisdictional Matter

The adjudicator rejected the employer’s submissions on jurisdiction, holding that the essential character of the employee’s dispute was an alleged human rights violation and the Commission therefore had jurisdiction.

The employer filed for judicial review of the adjudicator’s decision with the court.

Lower Court Finds in Favour of Arbitral Jurisdiction

On juridical review, the court found that the adjudicator had erred in characterizing the essential character of the dispute. It found that the essential character was whether the employer had just cause to fire the employee and ruled that a dispute that included a human rights violation that was associated with termination was within the exclusive jurisdiction of labour arbitration. The court therefore set aside the adjudicator’s decision on the issue of jurisdiction.

The employee and the Commission appealed.

Court of Appeal Finds Against Arbitral Jurisdiction

The Court of Appeal agreed with the lower court’s conclusion that disputes concerning the termination of a unionized worker lie within the exclusive jurisdiction of a labour arbitrator, including where the dispute alleges human rights violations. However, it ultimately allowed the appeal, finding that the adjudicator had jurisdiction for several reasons.

The employer appealed the decision to the Supreme Court of Canada.

The main issue before the Supreme Court of Canada was whether the exclusive jurisdiction of a labour arbitrator appointed under a collective agreement extended to human rights disputes that arise therefrom.

Supreme Court of Canada Explains Principles of Exclusive Arbitral Jurisdiction

The Supreme Court of Canada began by reviewing and explaining the general principles underlying an exclusive arbitral jurisdiction determination as follows:

“[R]esolving jurisdictional contests between labour arbitrators and competing statutory tribunals entails a twostep analysis. First, the relevant legislation must be examined to determine whether it grants the arbitrator exclusive jurisdiction and, if so, over what matters …. Where the legislation includes a mandatory dispute resolution clause, an arbitrator empowered under that clause has the exclusive jurisdiction to decide all disputes arising from the collective agreement, subject to clearly expressed legislative intent to the contrary.

If at the first step it is determined that the legislation grants the labour arbitrator exclusive jurisdiction, the next step is to determine whether the dispute falls within the scope of that jurisdiction …. The scope of an arbitrator’s exclusive jurisdiction will depend on the precise language of the statute but, in general, it will extend to all disputes that arise, in their essential character, from the interpretation, application, or alleged violation of the collective agreement. This requires analysing the ambit of the collective agreement and accounting for the factual circumstances underpinning the dispute …. The relevant inquiry is into the facts alleged, not the legal characterization of the matter.


Where two tribunals have concurrent jurisdiction over a dispute, the decisionmaker must consider whether to exercise its jurisdiction in the circumstances of a particular case.”

Supreme Court of Canada Rules That Complaint Must be Decided by Arbitration

In the result, the court allowed the appeal, ruling that the dispute fell within the exclusive jurisdiction of arbitration and, thus, the human rights adjudicator did not have jurisdiction in this case.

Ultimately, the court found that the essential character of the employee’s complaint was an allegation of a violation of the collective agreement, and it thus fell squarely within the arbitrator’s mandate. Because the Human Rights Code does not clearly express legislative intent to grant concurrent jurisdiction to the adjudicator over such disputes, the court ruled that the adjudicator did not have jurisdiction over the complaint, and the appeal was allowed.

Contact Guelph Employment Lawyer Peter A. McSherry for Experienced Advice on Discrimination in the Workplace

The Ontario Human Rights Code prohibits discrimination and harassment based on race, colour, ethnic origin, religion, gender, age, disability, sexual orientation, marital status and family status. If you feel that your rights have been violated as an employee, seeking the advice of an experienced and informed employment lawyer can help you understand your options to remedy the situation.

At Peter A. McSherry Employment Lawyer in Guelph, Peter McSherry has represented clients in all areas of employment since being called to the Ontario Bar in 1997. Peter provides each of my clients with compassionate care, attentive service and the efficient resolution of legal issues. If you are a unionized or non-unionized worker who has been discriminated against in the workplace, contact Peter to schedule an initial consultation by calling 519-821-5465 or by e-mailing. Harassment and discrimination cases are not to be taken lightly. Your rights deserve protection, and you deserve to work in a non-hostile work environment.