Proceedings of the Standing Senate Committee on
Social Affairs,
Science and Technology
Issue 25 - Evidence - April 16 Meeting
OTTAWA, Wednesday, April 16, 1997
The Standing Senate Committee on Social Affairs, Science and Technology, to which was referred Bill C-66, to amend the Canada Labour Code (Part I) and the Corporations and Labour Unions Returns Act and to make consequential amendments to other Acts, met this day at 6:00 p.m. to give consideration to the bill.
Senator Mabel M. DeWare (Chair) in the Chair.
[English]
The Chair: Honourable senators, I call the meeting to order. This is our first meeting on our study of Bill C-66. Our first witnesses will be officials who will explain the amendments that the government has decided to make to this particular bill. From the Department of Human Resources Development we have Michael McDermott, Debra Robinson, Johane Tremblay, Yvonne Beaupré, and Krishna Sahay. Please proceed.
Mr. Michael McDermott, Senior Assistant Deputy Minister, Department of Human Resources Development: I should like to make a correction to the list of witnesses. Krishna Sahay is from Statistics Canada. Part of this bill affects the Corporations and Labour Unions Returns Act, and he has some intimate knowledge of that statute.
It is a pleasure and a privilege to be invited here this evening. For two years, we have been carrying on a departmental review of the Labour Code. That review led to the proposals that you find in Bill C-66. The issues were somewhat complex and controversial, and the Minister of Labour of the day, Madam Robillard, appointed a task force of outside experts who held meetings across the country.
The members of the task force were appointed at the end of June, 1995. You may already have heard their names: Andrew Sims, a labour lawyer and arbitrator from Edmonton, Alberta; Paula Knopf, an arbitrator from Toronto; and Rodrigue Blouin, a professor of industrial relations and labour law at Laval University and also an arbitrator. They met over a period of about six or seven months. They toured the country and met the parties who work under the code, the people who are affected by the code, and academic and legal experts, and they brought forward a report entitled "Seeking A Balance" -- "Vers L'Équilibre" in French.
I should point out that in the course of their work the task force invited a labour-management group to discuss, and seek consensus on, issues of mutual interest. This resulted in agreement on major issues, such as the structure, powers and procedures of the Canada Labour Relations Board, which under this bill will be the Canada Industrial Relations Board, and the streamlining of the conciliation process.
The consensus group really did work hard and agreed on two very thorny issues that often are the cause for prolonging labour disputes once all the substantive issues have been settled. They agree that the right of employees to return to work after settlement of a strike or lockout, in preference to persons hired to replace them, and the right to due process for dismissal and disciplinary grievances when the collective agreement is not in effect, should be put into the code in very clear language.
In keeping with the task force's undertaking to give careful consideration to the matters agreed to by the labour-management consensus group, these agreements were generally reflected in the task force report. That report was presented to Minister Gagliano on January 31, 1996, shortly after his appointment as minister, and he made it public on February 13, 1996.
Subsequently, Minister Gagliano himself consulted with affected parties around the country and, as a result of both the task force recommendations and his own consultations, Bill C-66 was put through the policy development process and was drafted and tabled in the House of Commons on November 4 of last year.
One of the task force's key recommendations for change that has been included in the bill is a proposed representational Canada Industrial Relations Board, composed of a neutral chair and neutral vice-chairs, with experience and expertise in industrial relations. They will be appointed for terms of up to five years. In addition, there will be up to three full-time members representing employers and three full-time members representing employees, appointed for terms of up to three years. There will also be provision for the appointment of part-time representative members on a regional basis.
Representative members will be appointed by the Governor in Council on the recommendation of the Minister of Labour after the latter has consulted with management and labour organizations active in the federal jurisdiction. The result will be a labour board with assured expertise which will be aware of, and in touch with, the community it serves.
Under the bill, the Federal Mediation and Conciliation Service, a branch of the labour program in Human Resources Development Canada, will be given a higher profile in the statute, and its head will report directly to the Minister of Labour on dispute-settlement provisions of the code.
The conciliation process will be streamlined, with a single-stage procedure replacing the current optional two-stage process. The menu of choices among conciliation officers, commissioners and boards will remain, thus offering options which can be tailored to specific disputes.
The conciliation process will be limited to 60 days in total, but can be extended by mutual agreement of the parties. Both labour and management have criticized the current uncertainty about the duration of the conciliation process and find that it can inhibit prospects for settlement.
[Translation]
Mindful of the fact that a time limit has been set on conciliation procedures, we are also encouraging the collective bargaining process to be initiated earlier than currently provided for in the code. As things now stand, notice to bargain may be served on the other party three months prior to the expiry of an agreement. We are proposing that this period be extended from the current three to four months.
Provision has also been made for a cooling-off period upon completion of the bargaining process, before the right to strike or lockout is acquired. We are proposing that this period be extended from the current 7 days to 21 days. This would allow more time for serious bargaining at the end of the process.
[English]
In addition, before exercising legally acquired strike or lockout rights, there will be a requirement for a 72-hour notice period, to ensure an orderly curtailment of regular operations and an opportunity for contingency arrangements for perishables and the like.
For the first time, the federal statute, as is the case with most provincial statutes, will require a secret-ballot strike vote to be taken among the members of a bargaining unit before a strike can be commenced. The "shelf life" for that vote will be 60 days, which again can be extended by agreement of the parties. A similar requirement will apply to employers' organizations, whose members will have to vote before declaring a lockout.
These matters, as with almost all provisions in the bill, reflect either the labour-management consensus or the recommendations of the Sims task force. At the conclusion of Minister Gagliano's coast-to-coast consultations a year ago, labour and management representatives accepted the Sims package as a balanced one, and one with which they could live.
A number of amendments were made at committee or report stage before the bill reached the Senate. Some were in response to concerns expressed by the parties. For example, a change was made so that it is crystal clear that before ordering the production of documents outside of a hearing, the board must offer the parties an opportunity to make representations on relevancy. More substantively, the application of the provision regarding successive contracts for services was limited to airport pre-board security screening services.
My colleagues and I are at your disposal this evening or at any other time to assist by answering your questions or supplying additional information on the review process or on the contents of Bill C-66. We will, no doubt, have an opportunity to offer explanations of many provisions contained in the bill, but before concluding my opening comments, I should like to address briefly three issues raised in your debate on second reading yesterday.
The first concerns the provision regarding replacement workers. It was the only issue on which the three-member task force failed to reach consensus. Rodrigue Blouin favoured a general prohibition on the use of replacements, very much in the style of the provisions found in the Quebec and British Columbia Labour Codes. Andrew Sims and Paula Knopf jointly recommended that there should not be a general prohibition on the use of replacement workers during a work stoppage. However, to address those exceptional circumstances in which such workers are used for an inappropriate end, they recommended that the labour board be given discretion to order a stop to their further use if it finds that an unfair labour practice is undermining a trade union's representative capacity.
The provision in Bill C-66 expresses this majority task force recommendation. There have been claims from some quarters that the bill envisages a general prohibition or that it goes beyond the Sims report. Some have called for wording taken from the narrative of the Sims report. The statute, however, is a legal document, not a narrative piece.
The Minister of Labour is on record in the other place as stating clearly that the provision does not constitute a general prohibition on the use of replacement workers and that employers can use them to pursue legitimate bargaining objectives. They cannot, however, be used to undermine the ability of unions to represent their members. He is similarly on record indicating that suggestions that the mere presence of a replacement worker would undermine union representation are not valid and not in keeping with the intent of the bill.
In response to representations on this matter, the minister has indicated that the provision was drafted to capture the narrative of the task force majority recommendation in straightforward legislative language, capable of effective application and with an unequivocal burden of proof resting with a complainant. Additional wording would raise the prospect of more, rather than less, litigation. A statutory prohibition expresses what is not permitted; it does not need to list what is permitted. After all, what is not prohibited is allowed.
A second point concerns the fear that application of the off-site worker provision will lead to invasion of personal privacy and threats to individual security. This provision is also taken quite directly from the Sims recommendations, in this case a unanimous recommendation. I would draw your attention to the clear language of the provision. It says that in any order made the Canada Industrial Relations Board must -- not "may" or "might" or "could" -- include those conditions that must be met in order to ensure the protection of the privacy and safety of the affected employees and to prevent the abusive use of information.
The replacement-worker provision and the off-site worker provision will be administered and applied, as will many other provisions of the statute, by the Canada Industrial Relations Board, a quasi-judicial tribunal equipped with expertise and composed of experienced neutral heads and persons representative of both management and labour who will bring that necessary element of the practical real world to proceedings before it.
The last point I want to touch on concerns the Corporations and Labour Unions Returns Act. My colleague from Statistics Canada will be able to respond in more detail on this matter, but I should like to make a few brief comments. After careful evaluation, it was found that this is no longer used or useful. Repeal will, it is estimated, result in savings of around $300,000 annually to Statistics Canada, which will be authorized to stop collecting information which subsequently collects dust because it is never requested.
With respect to union financial statements, trade unions do prepare balance sheets, and have them audited and presented to their members, usually at their conventions. Furthermore, Part I of the Canada Labour Code currently contains a provision, section 110, which requires that every trade union must provide, on request by any of its members, a copy of its financial statement to the end of the last fiscal year, forthwith and without charge.
[Translation]
In conclusion, I want to thank you for inviting us here this evening. We are prepared to answer all of your questions and to assist you in any way we can.
[English]
The Chair: I see that you tried to address some of the points that have been brought to our attention over the last week or so. One of them, of course, was the replacement-worker provision. You said that what was in the Sims report seemed to be acceptable, but when the bill was drafted that wording was dropped and some people cannot see a difference between the use of a replacement worker and the services of a person. Do they not mean the same thing?
Mr. McDermott: A replacement worker is defined, in a sense, in the statute because it says that people cannot be used to undermine representational rights of a trade union. It is in the language of a prohibition. It says you cannot do this. What some people seem to be asking for is a list of all the things that are allowed. I think our statutes would be rather cumbersome if that were done.
One does not want to be absurd on these things. Robbing banks is prohibited. I suppose if there was a specific provision in the Criminal Code, or in the Bank Act for that matter, which said you could not go into the bank for the purpose of robbing it, you would not then add "rather than cashing a cheque or making a deposit." I think some people are asking for this "rather than" to be added, and the advice we have received from people who draft and apply statutes is that you should not make that rather cumbersome addition to what is a relatively simple prohibition.
There is absolutely no doubt that employers will be able to use replacement workers, but they will not be able to use them in contravention of the code, because that would be an unfair labour practice for the purpose of undermining a union's representation rights. In perhaps plainer language, that could say they cannot use them for union busting, but that language is not very elegant, and drafters generally do not phrase things in that manner.
Senator Maheu: I was interested in hearing more about the $300,000 savings for Statistics Canada. What have you done in the past and what will you be doing in the future to save that money?
Mr. Krishna Sahay, Assistant Director, Industrial Organization and Finance Division, Statistics Canada: Under the CALURA legislation, unions are required to supply fairly detailed information on their membership structure and on their financial balance sheets. The cost of running this survey, and then having the data edited, tabulated and published is roughly $300,000.
We tried to determine, by a review of the use of those data, whether we needed the CALURA legislation. We found that there is a continuing ongoing interest in issues dealing directly with industrial relations and economic analysis, questions such as the rates of unionization, the distribution by industry, by province, and by gender. We also found that in the five-year period preceding our decision to eliminate the CALURA reporting requirement, there had been one journalistic request for the financial data.
At the same time, we were in the process of revising the way in which we collected labour statistics. We had significantly improved our method of collecting the labour force statistics, in addition to which we had a very important new survey called the Survey of Labour, Income and Dynamics, which tracks individuals and their union activities through the various positions and jobs that they held in the year.
Based on our study, we found that we could meet all of our needs for information respecting employment, unionization, industry, gender, and so on. However, we were still left in the position of wondering about the adequacy of our collection of financial data, so we consulted further. We now have a good record of who asks for our data.
Statistics Canada has a number of advisory committees. In particular, we have a labour advisory committee. These advisory committees are composed of individuals from the private sector, from governments, and from academia. The labour advisory committee is chaired by Noah Meltz, a well-known labour economist.
We consulted the labour advisory committee about this issue. We explained that we have a budget problem, and asked them whether we should eliminate the requirements for these data. They all said it would be regrettable but no one remembered ever having used them, except perhaps the industrial data. That was the basis of our decision to stop collecting the labour union information. We felt we could satisfy the needs of our users from other sources and we could do so without damaging any ongoing analytical examination of which we were aware.
The chief statistician is constantly re-evaluating his program, and he makes decisions about specific series that he no longer feels are in demand or perhaps did not live up to the needs that they were initially designed to fill. When he makes a decision regarding a series, he has the authority under the Statistics Act to change the collection process. In this particular case, because the CALURA data are collected under an act other than the Statistics Act, we need an actual amendment to CALURA.
Senator Maheu: I would like to go back to the issue of replacement workers. There have been comments that this is not as strong as the "anti-scab" legislation that we have in Quebec. My understanding is that the in consultation that took place, management had one position, unions had another, and the task force settled somewhere in the middle. Is there any possibility that someone could misunderstand the clause in the bill that refers to the use of these workers? Could you explain it to us so that we will be able to respond to the comments we have been hearing?
Mr. McDermott: There is always a possibility that someone will not understand a statute, but I think this one is carefully drafted and I hope that it would be clear to people who work under the code. We have quite a sophisticated clientele in the jurisdiction, some of whom you will meet in the course of these hearings, and I do not think they can be under any illusion that this prohibition says you cannot use replacement workers.
In the Quebec Labour Code and in the British Columbia Labour Code, there are very clear provisions which say that replacement workers are just not allowed. The Quebec Labour Code even includes a ban on people crossing their own picket lines.
Senator Cogger: Could you refer us to the clauses of the bill that deal with this issue?
Mr. McDermott: You will find this on page 32 of the bill, in clause 42, which deals with section 94 of the code.
In the B.C. and Quebec codes, there is a very clear prohibition on the use of replacement workers in any circumstances. In British Columbia, workers do have the right to cross their own picket line, although I am told that that is a very rare occurrence. In Quebec, workers are not allowed to cross their own picket line and continue with their regular jobs.
This provision applies to people who are hired or assigned after notice of bargaining has been given, who are then used to replace people who are on legal strike or legal lockout. In recent years many of the federal labour disputes have resulted in lockouts, not strikes. Companies will be able to use these people for legitimate purposes. They will not, however, be able to use them to undermine the representation rights of a union.
Once a union gains representation rights under the model in the Canada Labour Code, which is the North American model, it has exclusive rights to represent the employees in the bargaining unit in matters of collective bargaining, such as concluding a union-management contract, a collective agreement, or in grievance matters and so on. Under this statute, if the continuing presence of the union is called into question and replacement workers are used to further that illegal intent -- an intent contrary to the code -- then the board would have discretion to order a stop to the use of replacement workers.
The provision captures the recommendation in the Sims report without using all of the narrative of the report. You can see how thick the Sims report is. It is a substantial piece of work. The code is much thinner, so it must be clear and it must be free of narrative. I do not think that provision could be any clearer. It will of course be subject to interpretation and application by a labour board -- a tripartite labour board which will have labour and management expertise available.
This issue of clarity has always been a problem with labour legislation. When the duty to bargain in good faith was first put into the Labour Code, there was a great deal of argument as to what it meant. I do not think there are too many people who work in our jurisdiction these days who would ask that question now. They know what it means. You cannot go into bargaining without intending to conclude a collective agreement. You cannot merely go through the motions. There is a substantial body of jurisprudence that has put some life into that statutory language.
The same thing will happen with regard to this provision in Bill C-66. I think it is clear enough for people to understand what it means.
Senator Cogger: I want to follow up on that question, Mr. McDermott. The clause reads:
No employer or person acting on behalf of an employer shall use, for the purpose of undermining a trade union's representational capacity, the services of a person...
Can you give me an example where the hiring of temporary personnel would not have the effect of undermining a union's representational capacity?
Mr. McDermott: We have had such examples in our jurisdiction. We have had two in the airline industry over the years which would show perhaps the contrast between a purpose which is a legitimate and one which is illegitimate.
Senator Cogger: Who has the burden of proof?
Mr. McDermott: The complainant. That will be the union.
Senator Cogger: If the union complains that a company is hiring temporary workers, they must prove that it is done for an illegitimate purpose?
Mr. McDermott: Yes.
Senator Cogger: They must prove intent?
Mr. McDermott: Yes. They must prove intent.
Senator Cogger: The union must prove the sole intent? I ask because while the effect might be one of undermining the union, that may not be the purpose.
Mr. McDermott: No. The intent would be to undermine. Please allow me to refer to some cases.The first is with regard to a dispute at a major national airline some years back. The flight attendants went on strike, replacements were hired and trained, there was a settlement, management's objectives were reached, and away went the replacement workers and it was business as usual. Obviously there is always harm and the relationship must be restored, but I do not think there was ever an intent to see that union disappear.
Another airline, a charter airline no longer in existence but located in Montreal, went through an 18-month work stoppage where one must question whether the union was ever welcome there in the first place. The certification was resisted and the sides went through a very difficult first set of negotiations. Then, in the second set of negotiations, there was a lengthy strike, during which management used what I think has become known as a "receding horizon". Whenever the union agreed to the requirements of the employer, suddenly the demands changed, the offer was no longer there.
A tribunal can assess the facts of each case to determine whether the intent is to reach a collective agreement, while keeping operations going with replacements workers, or whether what is at stake here is not to have that union or those unionized employees around any longer. I think there is a clear difference and it is a labour board that will assess these situations.
Senator Cogger: You are seeking on the part of the complainants proof of intent?
Mr. McDermott: Exactly. It is the same kind of thing that happens with allegations of bad-faith bargaining. The complainant must prove intent when it alleges that the other side is engaging in surface bargaining, for example, and has no real intention of settling, that it is just going through the motions. This is what a labour board does.
[Translation]
Mr. McDermott: Would you care to add something, Ms Tremblay?
Ms Johane Tremblay, Project Officer, Legislative Review, Part I of the Canada Labour Code, Department of Human Resources Development: The board will need to develop a test to ascertain the difference between surface bargaining and serious bargaining. It will have to determine, based on extrinsic evidence, whether the complainant, in this case the union, is indeed requesting a prohibition on the use of replacement workers because the hiring of such workers was done for illegitimate purposes.
[English]
Senator Andreychuk: What test are you using? Is it an objective standard or a subjective standard? It seems to me you are using some judicial mechanisms, some dispute-resolution mechanisms and some other mechanisms.
Mr. McDermott: It is an objective standard in the sense that the facts of the case will be put forward. Labour boards are already doing this on a daily basis. When there are allegations of bad-faith bargaining or unfair labour practices, the particular circumstances and facts of the case will be taken into consideration as a total and an opinion will be formed and a decision arrived at. I believe that is done objectively by quasi-judicial tribunals.
Senator Andreychuk: Generally, though, there is a framework of guidelines as to what those terms mean, often through customary law that has been built up in the field. In this bill we simply have an appointed board.
Mr. McDermott: It is appointed. The nature of the proposed board is slightly different from the one we have at present, which is non-representational. The chair and the vice-chairs will be neutral, with experience and expertise; the statute clearly says for the first time that they must have expertise in industrial relations. The members will be representative of labour and management, and the minister must consult labour and management organizations before appointing such people who must be aware of the industrial relations world and how it functions.
I keep citing the case of bad-faith bargaining. When that was first in the statute there was no framework, but over a relatively short period of time jurisprudence developed and you can now turn to legal guidebook or texts and find two or three pages which will summarize what that framework is. I would anticipate this will happen quite quickly with the provisions in Bill C-66.
Senator Andreychuk: There is no jurisprudence now. We are asked to put a lot of faith in the appointed members, that they will do a reasonable job and a fair job, but there seems to be no mechanism provided to check on them.
Mr. McDermott: There is a check, in the sense that there is always judicial review available. They cannot make patently unreasonable decisions. Judicial review is a safeguard. There is also a provision for internal reviews within the board. If one panel makes a mess of something, the whole board can sit and hear it. Jurisprudence has already developed around issues such as surface bargaining and receding horizon.
Senator Cogger: There is no body of jurisprudence regarding clause 42.
Mr. McDermott: Not under this particular clause.
Senator Cogger: How will these cases be determined? Is the process adversarial? What happens when a union says that something is being done contrary to clause 42? Does the board demand that the employer come and explain itself?
Mr. McDermott: No. The board must observe all the rules of natural justice and administrative fairness.
Senator Cogger: They will hear the parties?
Mr. McDermott: All of those Latin words that one hears thrown around are there.
Senator Cogger: Mr. McDermott, can you foresee a situation where temporary workers are hired and the union will not complain?
Mr. McDermott:Yes, I can. I do not see why they would want to waste their money on a case they know from the start will not succeed. These are expensive proceedings. They are not required to pay the board when they appear but they usually pay legal counsel, and that tends to be rather costly.
Senator Cogger: If a company hires temporary workers, do you think any union will say, "But we agree they are not doing that for the purpose of undermining our representative capacity"?
Mr. McDermott: Yes, I do think so. I suppose while jurisprudence is being established you may see people trying to determine what the limits are, but once they are established, as they have been for other parts of the statute, fighting them will be a waste of limited resources.
Senator Cogger: There have been concerns expressed about the privacy of off-site workers under the provision in this bill that makes lists of the names and addresses available to the unions. Have you consulted the Privacy Commissioner for his advice or for a ruling on this issue?
Mr. McDermott: No, not on this issue. There has been correspondence from the Privacy Commissioner on another aspect.
Senator Cogger: But not on this aspect?
Mr. McDermott: No.
Senator Cogger: Why not? Did no one think of it?
Mr. McDermott: No, it is not that at all. We all know that the Privacy Act exists and in certain circumstances it may have a relevance.
Senator Cogger: Under this bill, the employer will be required to make available to a union personal information relating to employees. Do you not think that should cause some concern for the Privacy Commissioner?
Mr. McDermott: I think there is quite a distinction between the Canada Labour Code and the Privacy Act. The Canada Labour Code applies to the entire federal labour jurisdiction. I do not believe that the Privacy Act extends that far.
Senator Cogger: Does it not apply to every Canadian citizen?
Mr. McDermott: That is not my understanding.
Senator Cogger: Does it only cover federal employees? Does it not cover provincial and other employees as well?
[Translation]
Ms Tremblay: Federal institutions and a number of Crown corporations have some obligations under the act. For example, to my knowledge, the provisions of the Privacy Act apply to the Canada Post Corporation, but as far as I know, most of the federal undertakings covered by the Canada Labour Code are not covered by the Act.
Senator Cogger: Surely the federal Crown is.
Ms Tremblay: Yes. However, the federal legislation does not apply to the vast majority of federal undertakings covered by the Code's provisions.
[English]
Mr. McDermott: In any event, it is clear that it is a quasi-judicial tribunal, and where other statutes are relevant -- whether it is the Privacy Act or the Charter of Rights and Freedoms -- they must be taken into account.
The same applies if an arbitrator is hearing anything as simple as a grievance. The arbitrator can take into account human rights legislation and even Charter questions. That has been established by jurisprudence as well. I do not think there is anything unusual here that requires special attention. Clause 50 of the bill, which sets out proposed section 109.1, provides very clear protection of privacy. Subsection (4) says, as I indicated in my opening remarks, that the board must include -- it does not have any option or discretion -- as part of its order the conditions that must be met in order to ensure that privacy and security are protected, and also to prevent the abusive use of information. Privacy concerns were clearly taken into account.
Any bill is drafted in consultation with officials from the Department of Justice, who are very aware of these kinds of interactions between various statutes.
The Chair: This only applies to say people that come under government jurisdiction. It does not apply to cottage industries or anything outside the jurisdiction?
Mr. McDermott: No. This applies specifically to the federal industries, such as interprovincial transportation and communications, and to some industries that have been declared to be for general advantage of Canada, such as the grain industry. It does not apply to the Public Service as such. Part II of the Canada Labour Code, which deals with health and safety, does apply to the Federal Public Service but Part I does not.
Senator Andreychuk: I have received representations of concerns that the bill gives the Canada Labour Relations Board the jurisdiction to certify a trade union that does not have majority support, in situations where, but for an unfair labour practice, the union could reasonably have been expected to have had the support of a majority of the employees in the unit. Can you comment on how that will work?
Mr. McDermott: I think it will be used sparingly. It is a provision that is found in some provinces. I forget precisely how many jurisdictions have some form of that provision, but there is jurisprudence elsewhere saying that the board may make such an order when the nature of an unfair labour practice committed by an employer makes it impossible to determine whether the true wishes of the employees can be ascertained. In this bill the government has added the provision, in line with the Sims recommendation, that where the board is convinced that, but for that illegal conduct, the union would have gained a majority of support, they can certify automatically even without a vote.
They will be able to draw to some extent on existing jurisprudence. As I say, it will be used very sparingly. It is clearly a remedy of last resort. In any event, the labour board has the right to order a vote of employees in any circumstances, and I presume if they felt the vote could be conducted in a fair manner, they would order the vote rather than use this power, but where they felt the vote would not reveal the true wishes of employees because of the level of interference, they could use this reserve power.
Senator Andreychuk: And this act does not require a secret representational vote?
Mr. McDermott: It is not mandatory, but where the Canada Labour Relations Board does hold a vote, it must be by secret ballot and supervised by the board officials. In cases where a union has signed up, I think it is between 35 and 50 per cent of the members of the proposed bargaining unit, a vote must be held. It is only when there is evidence of majority support on the basis of signed cards that the board has discretion not to hold a vote. When those votes are held, they are by secret, supervised ballot.
Senator Andreychuk: Is this the first time that we will have this type of provision in the federal Labour Code?
Mr. McDermott: Yes.
Senator Andreychuk: My experience in recent years has not been with labour votes but with elections, and I know intimidation takes many forms from many sources. My concern here is what standards will the board use to determine an unfair labour practice? Will the standards come from the existing body of jurisprudence from similar situations or will this be virgin territory?
Mr. McDermott: It should not be, because there is jurisprudence in other jurisdictions. There is already jurisprudence, under the Canada Labour Code, with regard to employer interference in the administration of a trade union, which is an area from which the application of this provision would draw.
Senator Andreychuk: It seems to me this is a dangerous precedent. The principle of majority vote in labour relations is being removed under this bill, and we will be in a position where a board will determine issues on behalf of the people involved. It is a rather paternalistic approach and an intrusion by the government. Surely there are other ways to ensure a fair vote. That is what we are after. Were other avenues or means explored to give effect to the intent in this clause?
Mr. McDermott: There are other avenues already in the code, and the board will have the option of using those. The people on the task force who recommended this have had labour board experience and they are aware of cases where interference has made it impossible for a vote to be seen as being fair. They concluded that the federal statute should have a provision similar to those found in the provincial statutes.
Senator Andreychuk: Can you tell us which provinces have such a provision?
Mr. McDermott: I believe most of them do. Ontario does. Alberta does not. We could check for you very quickly after the meeting. My recollection is that more than half the provinces have it.
The Chair: Before we finish I must ask you about the present board. I understand that this board will cease to exist as soon as this bill comes into effect and a new board will be appointed, with different terms. I am just wondering why nothing was put in the bill to deal with compensation for members of the present board who may have some years of their terms left. Do you not feel that the experience of some board members is important? The concept of having members appointed at different times is very important on a labour board because the members who understand the system can train the new members. I feel it would be very useful if the new board had some members with experience.
I suppose you have had no indication of whether any of the board members will be kept on, but I notice there was nothing saying, "Thank you for your five years. Here is your compensation package." Why is that?
Mr. McDermott: I believe that the Privy Council Office looks after those kinds of things. I am sure the situation has arisen before with other tribunals that have either changed their character or have been wound up, and there are procedures that take care of that. What will happen here will not happen the day the bill is passed. There is a provision here bringing the bill into force by stage.
The Chair: What about disputes that are under your jurisdiction at the time the bill is proclaimed? They will have to deal with.
Mr. McDermott: That is expressly provided for in the bill. There is provision for the new chair to reassign cases, but the statute envisages that current cases will continue. There is, as I say, an option that they can be discontinued, or, if the parties choose to stand down, a new panel could be named. I think that sufficient notice of the changes will be given to board members and they will have an opportunity to apply for positions on the new board. To my knowledge that is as far as it goes. As I say, these are usually dealt with by the Privy Council Office, which deals with many different tribunals.
The Chair: I understand the minister is prepared to come before the committee when he is available. If we have any questions, we will be back to you.
Senator Cogger: Do you know how many cases are currently either pending or ongoing before the board? If you do not have that information with you, you could provide it later.
Mr. McDermott: Currently I think the vice-chairs and the chair each carry about 30 cases. There are five vice-chairs and a chair.
Senator Cogger: There would be approximately 200 cases?
Mr. McDermott: Approximately. These are cases that are ongoing, either in the early stages or coming up for adjudication. We will provide the committee with accurate figures.
The Chair: Honourable senators, our next witnesses are from the Western Grain Elevator Association. We have with us Ed Guest, the Executive Director; Bonnie Dupont, the Chairperson of the Human Resources Standing Committee; and James Carwana, counsel and adviser.
Mr. Ed H. Guest, Executive Director, Western Grain Elevator Association: Madam Chair and senators, our message is fairly simple, but it is extremely important to the grain industry and Canada as a whole.
Members of the Western Grain Elevator Association and the British Columbia Terminal Elevator Operators Association certainly appreciate the opportunity of making a submission dealing with the amendments to the Canada Labour Code. We do not intend to comment on all aspects of the proposed amendments, simply on those which are especially important to the grain industry. Along this line, the associations have the same concern as many other groups about the provisions regarding replacement workers and the uncertainty inherent in those provisions. We believe, however, that those matters will be addressed -- as they just have been -- by others, so we will focus our comments on the grain industry amendments.
For your information, the Western Grain Elevator Association was established in the late 1800s. It represents the nine major grain companies operating in Western Canada. Our members serve farmers in the four provinces at over 1,000 points on the Canadian prairies. We own in excess of 99 per cent of all the elevators in Western Canada and all of the terminal elevators on Canada's West Coast and at Thunder Bay. These terminals, by the way, are the only ones available to handle Canada's overseas customers' grain requirements.
The British Columbia Terminal Elevator Operators Association, a major part of the Western Grain Elevator Association, was formed in 1957. It is an employers' organization which has been granted authority to bargain collectively on behalf of member companies on the West Coast with the union which represents their employees. The members of the association include a cooperative, a consortium of cooperatives, publicly traded cooperatives, a consortium of grain companies and, lastly, a private company.
Our association supports the amendments to the code which ensure that disputes involving industries other than the grain industry do not have a negative impact on the flow of grain. By and large these amendments are reflected in proposed section 87.7, which provides for the maintenance of services to grain vessels during other disputes.The proposed section 87.7 states:
(1) During a strike or lockout not prohibited by this Part, an employer in the long-shoring industry, or other industry included in paragraph (a) of the definition "federal work, undertaking or business" in section 2, its employees and their bargaining agent shall continue to provide the services they normally provide to ensure the tie-up, let-go and loading of grain vessels and the movement of the grain vessels in and out of a port.
(2) Unless the parties otherwise agree, the rates of pay or any other term or condition of employment, and any rights, duties or privileges of the employees, the employer or the trade union in effect before the requirements of paragraphs 89(1)(a) to (d) were met, continue to apply with respect to employees who are members of the bargaining unit and who have been assigned to provide services pursuant to subsection (1).
(3) On application by an affected employer or trade union, or on referral by the minister, the board may determine any question with respect to the application of subsection (1) and make any order it considers appropriate to ensure compliance with that subsection.
The importance of the grain industry to the country is well recognized. The reason the Canada Labour Code applies to the industry at all is that grain elevators have been declared to be "for the general advantage of Canada" under the Constitution Act. Along this line, in a recent decision, the Supreme Court of Canada stated that the movement of grain from the Western terminals in Vancouver and Prince Rupert has always been of great economic importance to the country. Even more recently, Canada's Minister of Labour noted that a conciliation commissioner was appointed in a dispute involving grain handling on the West Coast because of the importance of a healthy grain industry to the Canadian economy and to Canada's international representation as a grain exporter.
Problems arise when disputes in other industries affect the flow of grain. Such disputes have nothing to do with the world-wide competitive forces affecting the grain industry and cannot be solved by the economic forces at play between parties within the grain industry. Instead, disputes that are external to the grain industry but that affect the grain industry can lead to grain being used as a hostage. The Industrial Inquiry Commission Into Industrial Relations at West Coast Ports found that the long-shore industry had used its capacity to halt grain exports as a type of ace-in-the-hole in the past. I will use that term numerous times throughout the rest of our presentation. The commission, after review, stated as follows:
Against the background just set out, the Commission examined the relationships and the state of industrial relations at West Coast Ports. In the long shoring industry in particular, many of the normal elements of a collective bargaining relationship as envisaged by the Code are wanting. This is especially evident in the critical area of dispute resolution where, as noted earlier, the parties constantly run into trouble.
In this regard, many point to continued government interference as the major contribution factor for the industry's ailments and they speak in terms of never having been allowed to address their own substantive problems through the pressures of realistic economic sanction. Closer to the truth though, is that the industry itself has brought this whole ritual of government intervention on themselves. Moreover, it is deliberately used by the industry to cloak its inability to resolve its own problems as well as a tool to counter the intransigence that is deeply rooted in their bargaining strategies. In the meantime, rather than engaging in serious and responsible negotiations as envisaged by the Code, the parties generally engage in what is termed in labour relations parlance as "surface bargaining". This is a term used to describe a going through the motions, or a preserving of the surface indications of bargaining without the intent of concluding a collective agreement. Indeed, it appears to the Commission that collective bargaining in this industry has been reduced to a ritual that is more akin to a poker game with the ace-in-the-hole being the capacity to halt grain exports. Everyone knows that when this card is played, it almost guarantees speedy intervention by Parliament. This in turn, reduces the risk of the parties having to face the hardships of a prolonged work stoppage. All the while, they are doing their best to manoeuvre their tactical positions getting prepared for the inevitable third-party intervention. Collective bargaining per se, simply no longer exists.
The commission found that grain exports were affected on numerous occasions due to the inability of the parties in the long-shore industry to arrive at a collective agreement. For example, legislation was needed in 1995 in order to prevent the stoppage of grain due to a lockout of long-shore foremen and in 1994 to end a strike by long-shore workers affecting grain exports.
Our associations submit that is it particularly important that disputes between parties in other industries be kept to those parties and that those disputes not affect the grain industry. To allow the grain industry to become a hostage in disputes involving other industries causes severe detriment to Canada's competitiveness and reliability as a supplier of grain in a global economy.
At present, the Canadian grain industry is in transition as it attempts to lower costs and increase productivity. Much of the government regulatory framework is undergoing a major overhaul and legislation which has subsidized rail tariffs in the past has now been repealed. The result is that the costs to the farmer of transporting grain have effectively doubled, creating demands that everyone else in the export chain become more efficient and reduce their costs.
At the same time, Canadian farmers are facing increased competition from other countries which are also seeking to reduce costs and become more efficient. A major factor of great importance for Canada, in maintaining customers in this climate of increased international competitiveness, is the ability to demonstrate that our country is a reliable supplier of grain. Indeed, the major ongoing threat to the grain industry is the concern of customers with respect to the reliability of Canada as a supplier. The Western Grain Marketing Panel noted as follows:
During a meeting which the Panel held with the President of COFCO (Chinese Food Agency), Mr. Zhou Mingchen and his officials, the President noted that Canada was China's largest and preferred supplier of wheat. At the same time, he indicated that other suppliers were improving the quality of their grain and services and that Canada must make strong efforts to remain competitive in order to meet China's requirements. Mr. Mingchen expressed considerable interest in joint ventures with Canada in processing grain and related activities. His only major criticism of the Canadian system related to supply disruptions, attributable to vessel delays in the Port of Vancouver.
With respect to our Japanese trading partners, the panel also noted that they are generally pleased with the Canadian marketing system, apart from transportation difficulties in the Port of Vancouver.
There have been many other reports of problems by Canada's grain customers' noted in the grain marketing panel's final report.
After hearing all of the submissions from all of the parties, the Industrial Inquiry Commission decided that the goal of isolating grain handling from other disputes should be accomplished, which it has been in the legislation. To achieve this goal, the legislation seeks to prevent the long-shore industry from using grain as an ace-in-the-hole. Thus, in a long-shoring dispute, the services which are normally provided to ensure the tie-up, let-go and loading of grain vessels must be maintained.
It is respectively submitted that it makes sense to treat grain in this fashion for a number of reasons.
First, grain has been used as an ace-in-the-hole in long-shoring disputes in the past and the use of grain as a type of hostage in other disputes should not be permitted to continue. The use of grain in this manner harms Canada's reputation as a reliable supplier of grain and is unfair to grain producers and buyers of our food products. The Industrial Inquiry Commission Into West Coast Ports thoroughly examined this issue and came to the conclusion that grain handling should be isolated from other disputes. No similar finding was made with respect to any other commodity. Therefore, the rationale which applies to grain simply does not apply to other commodities.
The Industrial Inquiry Commission also found that bargaining in the long-shore industry had been adversely affected by the use of grain as a type of hostage. Again, similar findings were not made with respect to any other commodities by the commission after a thorough examination of this issue.
Second, the grain industry has been declared to be for the general advantage of Canada under the Constitution Act. While other commodities may be important, the fact of the matter is that grain has been recognized as warranting different considerations in legislation which has previously been enacted. Both the House of Commons and Senate recognized that the grain industry is for the general advantage of Canada when passing the Canada Grain Act and the Canadian Wheat Board Act. In this respect, treating grain differently from other commodities in legislation is not a change from previous acts, but is consistent with the treatment of grain in other legislation.
Third, it should be borne in mind that all of the arguments made by others against proposed section 87.7 have already been made to the independent commissioners studying the matter. The fact of the matter is the Industrial Inquiry Commission Into Industrial Relations at West Coast Ports thoroughly studied this matter. The commission was made up of independent experts without any stake in the outcome. They took many months to hear from all interested parties, gather all the facts, consider the issues, and make their findings. Indeed, the commission heard from some 70 different groups and individuals in places such as Vancouver, Prince Rupert, Calgary, Regina, and Winnipeg. The independent commission came to the decision that the long-shore industry had used grain as an ace-in-the-hole and that such a tactic should not be permitted to continue in the future. Proposed section 87.7 is the legislative response to meet this goal.
The Sims task force also dealt with arguments against legislation such as proposed section 87.7 and rejected those arguments. Their report noted as follows:
...We expect that such approaches would not be welcome by longshore and other maritime employers. As well as by producers of other commodities exported through West Coast ports who might find it discriminatory. However, because of its importance, the grain industry be declared to be for the general advantage of Canada, under the Constitution Act, and, therefore, within the jurisdiction of the Canada Labour Code. This is not the case with most other commodities.
Senators, the point to be made here is that after conducting a thorough investigation into the issues, during which the parties opposed to such legislation were heard by independent experts, a decision was nevertheless made by the commission members that grain handling ought to be isolated from other disputes. The potential negative impacts -- and the potential positive impacts -- have already been examined by independent experts and a decision has been made. The legislation simply seeks to meet a need which the independent Industrial Inquiry Commission found to be existing with respect to the grain industry.
It is respectfully submitted that the underlying reason for opposition to proposed section 87.7 is that the long-shore industry will no longer be able to use grain as its ace-in-the-hole. While it may be natural that no one likes to give up such an ace-in-the-hole, both a commission of independent experts and the House of Commons have come to the conclusion that this must occur for the greater good of the country. As a result of being required to continue their services to grain vessels, both the long-shore companies and long-shore workers who provide these services will continue to receive revenue and get paid for their activities. The legislation simply takes grain out of the bargaining equation for both sides.
Moreover, the government has said that it will monitor the workings of this measure and its effectiveness in the future. Therefore, if any changes are needed, they can certainly be made. At present, though, it is respectfully submitted that proposed section 87.7 ought to be adopted to achieve the goal identified by the experts conducting the industrial inquiry commission and by the House of Commons.
It should also be noted that by taking grain out of the equation for disputes in other industries, the proposed legislation will help to promote collective bargaining in those other industries. The industrial inquiry commission noted that other parties have used grain as an ace-in-the-hole in the past to avoid real bargaining and to engage in "surface bargaining." By removing grain from the picture, the issues facing those other industries will become the focus of real collective bargaining. We submit that these circumstances will be beneficial to those industries as well as to everyone affected by the Canadian grain industry.
Our association believes that proposed section 87.7 requiring the maintenance of services to grain vessels is a positive step toward removing the effects of labour disputes in other sectors from Canada's grain industry. This step is in line with the recognition that grain has been used as an ace-in-the-hole in the long-shoring industry in the past and that that should not be permitted to continue. The amendments are also in line with the recognition that the grain industry has been determined as being for the general advantage of Canada in other legislation, and the recognition that a healthy grain-handling industry is important to the Canadian economy and to Canada's reputation as a reliable grain exporter.
Senators, the government has now sent the right message to Canada's buyers of our food products. We are concerned that if the momentum of this initiative falters, our customers will conclude that we are not concerned and they will look elsewhere for their grain food supply. We urge you to pass this bill as soon as possible to ensure that our international customers will continue to buy our grains.
I respectfully submit this on behalf of our member companies and I would like to name them for the record: Alberta Wheat Pool; Cargill Limited; Manitoba Pool Elevators; Parrish & Heimbecker, Limited; N.M. Paterson & Sons Limited; Pioneer Grain Company, Limited; Saskatchewan Wheat Pool; United Grain Growers Limited; and Weyburn Inland Terminal Limited.
Senator Maheu: As a Quebecer I was not too familiar with grain until I started reading about this issue. The more I hear, the more interesting the subject becomes.
Is it true that since 1972 there have been approximately 12 strikes on the West Coast, of which nine required back-to-work legislation?
Mr. Guest: That sounds close. Perhaps the experts can give you the exact number.
Mr. James Carwana, Counsel and Advisor, British Columbia Terminal Elevator Operators Association: Between the B.C. Maritime Employers Association and the long-shore union there have been 12 rounds of collective bargaining and six work stoppages, five of which were ended by legislation.
Ms Bonnie Dupont, Chairperson, Human Resources Standing Committee, Western Grain Elevator Association: That is since 1982, not 1972.
Senator Maheu: What happened to the three that did not require legislation to get back to work?
The Chair: The parties settled on their own.
Senator Maheu: I would anticipate that we may expect some vigorous objections from the long-shoring people. I have also been led to understand that your association did not want binding arbitration for your industry. Do you still feel that way, and, if so, why?
Ms Dupont: Within our own industry, bargaining with our own unions, we would prefer to use a collective bargaining process through to its logical conclusion and avoid arbitration. We have unfortunately been in the situation from time to time of having our disputes ended by back-to-work orders and arbitration.That is generally not a satisfactory solution for either party.
Senator Maheu: You say that has happened in the past. Given that record, how are you going to avoid binding arbitration in the future?
Ms Dupont: The way to avoid that, I would submit, is to go through the process of a labour dispute until there is a logical settlement.
Senator Maheu: Before the board?
Ms Dupont: Between the parties.
Mr. Guest: We are dealing with two separate issues here. If you are asking how the grain industry would prefer to handle their own labour negotiations, I can say we would prefer to handle them without interference from anybody, but we would also prefer to conduct our own business without having someone else's dispute stop the supply of food to the rest of the world. There are two separate points here.
Senator Maheu: It sounds as though you are looking for the best of both worlds.
Mr. Guest: We are more than prepared to sit down and deal with our employees on an economic basis to work out the best possible scenario. If they shut us down, we lose money, but so do they. We cannot influence other sectors when they are having a labour dispute. If the sulphur industry has a labour dispute, that does not cause a food shortage in itself but we should not be made to suffer for their problem.
Mr. Carwana: Another distinction is that the grain industry must be sensitive to international forces and must be able to respond to those forces when it is bargaining with its own union. The legislation -- and rightly so -- takes other disputes out of equation so that the grain industry can continue to contend with those world forces.
Senator Maheu: You want this bill to force the long-shoremen to service your ships even if they are on strike or under a lockout, and yet you do not seem to be quite as prepared to have your organization made subject to the same process by which the board could force you back to work or at least look at the dossier.
Ms Dupont: The situation with our own people and our own industry is one we can manage through the collective bargaining process. Certainly, as Mr. Guest pointed out, if we have a dispute, if we lock our employees out or if they strike, we both have a problem and we both suffer the economic consequences. We are prepared to go through that process with our own employees. We are very much on top of our own collective bargaining processes. Our problem is with collective bargaining processes that we do not control that nevertheless profoundly affect us. We make a distinction between those. We work with our own unions and we take our chances with our own unions on economic issues. If you look to history, you will see that third-party disputes over which we have no control have affected us much more profoundly than disputes with our own union. These third-party disputes have caused many more delays in shipping product to our offshore customers.
Senator Forest: I am from the West, I come from a grain-farming family, and I have been on the board of CN, so I really appreciate the problems resulting from work stoppages on the coast. Demurrage charges in the Port of Vancouver last year cost approximately $50 million. Our wheats and grains were not getting to market. We are in a very competitive global situation with respect to grain. It is one of Canada's largest export industries, and I think the record of work stoppages speaks for itself. We have enough trouble getting our grain to market, dealing with the size of the country and the winter conditions and so on, that we should not have to put up with these stoppages. I believe in fair labour practices, but the grain industry has been held hostage for too many years and I think enough is enough. The farmers should not have to pay those kinds of costs. The Crow Rate is gone but their shipping charges have doubled, and they should not be required to bear the costs of third-party disputes, especially when those parties use grain as a hostage.
I received a presentation last night from the chairman of the Canadian Wheat Board and their situation is the same. I support this legislation. I think it is fair. The fact that the grain industry is in the constitution should tell us something about its importance. I heard all the arguments against treating grain in a way different from other commodities, but it is different. Historically it has always been treated differently. I really feel that this legislation is very important.
Senator Perrault: I am very interested in this subject. The grain terminals are in my constituency. I drive by them every night when I go home. If we want to make progress, we should strive for a good working relationship among the grain handlers and the long-shoremen and everyone else associated with the movement of grain. It is certainly in the national interest.
I talked to a grain handler who said, "We worked for months and months without a contract with the pools. We could not get them to sit down and discuss ways to make the industry more efficient." I was told that they are very worried about the possibility of prairie grain shipments going through U.S. ports, such as Portland and Tacoma, and they are desperately concerned with making sure their workers are efficient so any possibility of having shipments diverted to U.S. ports will not exist.
What is your view on this? Why did it take so long to put a contract together? I do not even know if a contract has been written yet, even though it has been the subject of judicial commissions and surveys. It has really been a chaotic scene, has it not?
Ms Dupont: Yes, it has.
Senator Perrault: What is the problem? Why can we not work together as Canadians to get on with things?
Ms Dupont: There is finally a contract in place which will take us through to the end of the year 2000. It is an eight-year contract but it ends then because we were without a contract for quite a while, as you were told. The difficulty we faced in the last round of negotiations was working towards what we call in our industry "continuous operations".
The world has become a 24-hour-a-day, seven-day-a-week environment. The railways are operating seven days a week and on extended shifts. The ships coming into port expect that they can be loaded at various times, so we had to work hard with our union to get a continuous operations agreement.
Senator Perrault: These are the grain handlers?
Ms Dupont: The grain handlers, that is right. Under the old contract, we had the capability of having our people work extended shifts but we were paying prohibitively high overtime rates.
Senator Perrault: This is what I have been told.
Ms Dupont: That is right. We worked hard to negotiate a contract where the overtime rates would start to decrease. We have achieved that goal. We now have a continuous operations agreement in place and, over time, we feel that that will be a great help economically not just for the grain industry but for the country.
Senator Perrault: Do you think then that the threat that some shipments of wheat and other products will move through Tacoma and Portland and other U.S. ports has disappeared? We do not want that to occur. We do not want grain shipped down the Mississippi either. The Americans complain about Canadian agriculture being subsidized, and yet the shipment of grain down the Mississippi is subsidized by the U.S. federal government, is it not?
Ms Dupont: That is what we understand. I would say to you that the talk of shipping grain through U.S. ports has arisen from a sense of desperation on the part of the grain companies, in terms of meeting contracts with overseas customers. With the agreement we now have in place, we do not foresee Canadian grain being shipped through U.S. ports.
Senator Perrault: I have been trying to play a constructive role behind the scenes on this issue. One of the grain handlers told me that the union recognizes the fact that they must be very flexible and efficient in order to maintain Canada's competitive position. He said it is a myth to assume that his union's workers will not work at jobs other than the standard, narrowly defined jobs that have existed to this time. Is there new flexibility in your contract with the workers?
Ms Dupont: I would say there is minimal flexibility.
Senator Perrault: You would like to see more, would you?
Ms Dupont: Yes. As an employer, we would like to see more.
Senator Perrault: In what sense? Can you give us an example?
Ms Dupont: An example is the restrictions that are in some contracts regarding work classifications. The difficulty you face in any plant arises when a worker can do only the work called for in a particular classification. If you need work done outside the classification, you must call in another worker, and that adds to your costs.
Senator Perrault: They have suggested their should be more flexibility and they would be prepared to consider that. There are some good signs of progress.
Ms Dupont: I think the situation with our own union has been quite positive in that we were able to move towards continuous operations.
Senator Perrault: There certainly has been a slowdown of grain deliveries in the past few weeks, though. It is good to hear that progress is being made and that you support the bill. You think it is moving in the right direction?
Ms Dupont: We certainly do.
Senator Cogger: Do you know what proportion of the volume of the Port of Vancouver, or the other ports of the West Coast, grain represents?
Ms Dupont: I have a document that will indicate that.
Senator Cogger: Can you just give me a ballpark figure? Is it 25 per cent or 50 per cent?
Ms Dupont: In the absence of my document, I am relying on Mr. Guest's estimate of 60 per cent.
Senator Cogger: The deputy minister apparently agrees.
Mr. Guest: It used to be 60-40 in favour of Thunder Bay; it is 60-40 in favour of the West Coast now. That is largely as a result of the change in markets. When the Russians were our major customer, before the Pacific Rim took over that spot, 60 per cent of grain exports went through Thunder Bay. Recently, the 40 per cent that has been moving through Thunder Bay has been equal to the old 60 per cent because of increased volumes.
Senator Cogger: On the list of groups that are indicated as intending to appear before us are the British Columbia Maritime Employers Association, Western Canadian Shippers Coalition, Waterfront Foremen Employers Association, and so on. I suspect they may not be as supportive of proposed section 87.7 as you are. I do not want to be too presumptive but I presume the unions will tell us that this bill severely curtails the right to strike. What do you say about that?
Ms Dupont: The bill severely curtails the right to strike grain. It requires them to keep grain moving. They will be able to strike in other areas. The long-shore workers will be able to strike in other areas.
Senator Cogger: Yes, but that is 60 per cent of the volume of the Port of Vancouver.
Mr. Guest: Senator, perhaps there is a misunderstanding. Sixty per cent of Canadian grain exports move through the West Coast ports. I cannot tell you what percentage of the tonnage of product that moves through the West Coast port is grain.
Senator Cogger: I was looking for a percentage of the volume in the port.
Mr. Guest: That grain represented as tonnage?
Senator Cogger: Against coal or chemicals or other products.
Ms Dupont: I can tell you. It is 16.9 per cent of the volume of the port. The other commodities are coal, sulphur, potash, chemicals, wood, pulp, lumber, sand and gravel, fuel oil, animal feed, gasoline, phosphate, rocks, crude petroleum, et cetera.
Senator Cogger: You have had your own labour problems with your own employees.
Ms Dupont: Certainly.
Senator Cogger: You went back to the table and managed to get everybody back to work. In recent history, how long was the longest work stoppage?
Ms Dupont: With our own employees?
Senator Cogger: Yes.
Ms Dupont: In 1985 we had a stoppage that lasted for 42 days.
Senator Cogger: But Mr. Guest just told us that when the grain does not move, people starve.
Senator Maheu: That is not the long-shoremen; that is their employees.
Senator Cogger: No, please let me finish. When the grain does not move people in other parts of the world might starve or go hungry. Indeed, grain is not a commodity like the other stuff. What happens to the good people around the world during those 42 days?
Mr. Guest: Those countries that ran out of food supplies coming from Canada bought them from somewhere else, and if we got them back as customers we were extremely fortunate. That is a situation of the grain industry and the grain handlers suffering the consequences of not bargaining quickly enough. Both sides lose in perpetuity if we lose those markets. Both sides are facing the same problem and, as Senator Perrault said, the grain handlers at Vancouver do not want those problems. They want to work through them and get an agreement.
Senator Perrault: The independent experts that we heard about, are they representative of a number of sections of the industry?
Mr. Carwana: I must refer, first of all, to the Jamieson Greyell Commission. Jamieson and Greyell were the independent experts who were appointed and prepared the report on the industrial relations at the West Coast ports and, as you probably know, both Mr. Jamieson and Mr. Greyell have extensive experience in labour relations.
Senator Perrault: Those are the ones you refer to in the brief?
Mr. Carwana: Yes.
The Chair: Thank you for appearing and giving us your views.
Honourable senators, our next witnesses are from the chemical industry. We have before us David Goffin, Vice-President, Business Development, from the Canadian Chemical Producers Association, and Claude-André Lachance, Director, Government Relations, Dow Chemical Canada.
Mr. David Goffin, Vice-President, Business Development, Canadian Chemical Producers Association: I will start by reading our submission on behalf of the association, and then Mr. Lachance, a representative of Dow, which is a major shipper through the Port of Vancouver, will comment from the point of view of his company.
You just heard about the ace-in-the-hole. We are one of the sectors that feel we may be treated as the "deuce in the hole" by this legislation.
Our submission focuses on one provision of Bill C-66, the amendment that would add proposed section 87.7 to the Canada Labour Code. CCPA is firmly opposed to this amendment, which provides that grain vessels would continue to receive services during work stoppages in ports, while vessels carrying other important export cargoes, such as petrochemicals and other chemicals, would receive no such relief. We want to be clear that we have no argument with grain shippers. We agree that reforms are needed to protect and enhance Canada's reputation as a reliable supplier in key export markets, but our point is that the solution should apply across the board; it should not be limited to just one commodity.
CCPA represents 70 member companies producing $15 billion worth of industrial chemicals annually, with 55 per cent of this output destined for export markets. Our member companies produce petrochemicals, inorganic chemicals and specialty chemicals. Exports through West Coast ports are important for companies in each of these categories, but they are especially important for Alberta's petrochemical producers. These companies count on exporting a substantial portion of the output from their world-scale plants to Asian markets.
In the global marketplace for petrochemicals and other chemical commodities, price and on-time delivery are the two major competitive forces. When there is even a hint of a possible transportation work stoppage in Canada, our member companies hear immediately from their customers in China, Japan, Korea, and other vital export markets. When a work stoppage has actually occurred -- which has happened all too frequently -- some of our members have lost sales to customers who turned to competitors in countries that do not have a history of frequent labour disruptions in their shipping processes, such as the United States and Saudi Arabia.
Our members have been able to weather transportation disruptions to some extent so long as the government has reacted reasonably promptly to bring them to an end, but the additional costs incurred in doing so are important. All of our members using West Coast ports are concerned for their future, because if grain vessels receive the special treatment proposed in Bill C-66, there would naturally be less pressure to bring work stoppages to a timely end.
Today member companies, such as Dow, Methanex, NOVA, Shell, Union Carbide and others, ship chemicals valued at about $1.3 billion through West Coast ports, primarily Vancouver. Our member companies have also announced major new petrochemical investments in Alberta, which will substantially increase these shipments over the next few years because, in order to be viable, a new plant must plan to market an average 40 per cent of output in offshore markets. Mr. Lachance will talk to you in a moment about Dow's current shipments and his company's future plans.
Several of the other companies mentioned have announced new ethylene, polyethylene, and ethylene glycol investments, totalling close to $2 billion, with more still to come. Disruptions to shipments from these plants would cost our members millions of dollars. Perhaps even more important, work stoppages in the transportation system are taken into account when potential investors consider Canada for additional new chemical projects, and they certainly result in a large black mark on the checklist of investment factors.
In presenting our recommendations concerning proposed section 87.7, we want to make it clear that the CCPA does not purport to have extensive expertise in labour relations issues, especially issues concerning the federal Labour Code. Our general recommendation is that solutions to work stoppages in the ports should provide equal treatment by taking all relevant sectors into account rather than insulating one sector of the economy from negative impacts at the expense of other sectors.
Ideally we would prefer amendments to the legislation to provide for final-offer-selection arbitration in the event of a collective bargaining impasse. The CCPA is a member of the Business Council of British Columbia, which recommended such amendments to both the Industrial Inquiry Commission Into Industrial Relations at West Coast Ports and to the Sims task force.
If I could depart from our written comments for just a moment, I should just like to say that the industrial inquiry commission, as the previous witnesses pointed out, certainly made recommendations that were specific to grain, but it did so in the context of broader recommendations that were to be applied when there were work stoppages that threatened the economy as a whole. I think if we saw a balance in the legislation, where the other recommendations of the industrial inquiry commission were picked up along with those pertaining to grain, we would be much more content with this bill.
At this late stage in the process, however, we are uncertain as to whether such amendments would be possible. Assuming they are not, then we recommend that proposed section 87.7 be amended so that the remedy it provides is available to all relevant commodities. If that is not practical, then as a final alternative we recommend that proposed section 87.7 be removed from Bill C-66 so that the matter of port work stoppages could be further considered and addressed on an equitable basis at a later date.
We put that last because, as we said, we have no wish to harm the grain shippers; we are simply asking for equitable treatment.
Those are the association's views. Mr. Lachance will now comment from the perspective of Dow Chemical Canada Inc.
[Translation]
Mr. Claude-André Lachance, Director, Government Affairs, Dow Chemical Canada Inc., Canadian Chemical Producers Association: Honourable senators, I would like to begin by saying a few words about our organization and the reasons why this issue is so important to us. I will then review the situation as we see it and then give you our recommendations.
[English]
Dow Chemical is a $20 billion global company. We have $2.5 billion invested in Alberta, and in the past five years we invested $1 billion in the Canadian economy. In Alberta we operate seven world-scale plants, and by "world-scale" we mean plants that export world-wide. More specifically, we export $400 million in the Pacific Rim, and we export through Vancouver. Just to give you a sense of perspective, we process 30 rail cars each day at our Vancouver terminal, and those 30 cars represent 1 million metric tonnes per year. We are a major shipper.
Vancouver Harbour is a key transportation infrastructure link to bring our products to East Asia's expanding markets. We have been concerned about the status of the labour relations in Vancouver Harbour over the years, and we appeared in front of the West Coast inquiry to lay a claim on the process in terms of our needs for reliable operations.
To my knowledge, as Mr. Goffin indicated, neither the West Coast inquiry nor the Sims inquiry proposed that grain handlers be protected at the expense of other sectors of the economy. Yet this is precisely the result that one can expect from the legislation as it stands now.
I was a bit aghast, frankly, when I read the minister's comments at third reading in the other place, when he indicated that this bill was based on large consensus. I do not believe there is much of a consensus among shippers, with the notable exception of those that benefit -- the group that appeared before we did -- in terms of the impact of those changes on our ability to bring our product to export markets.
Honourable senators, let me be absolutely clear. As a large producer of manufactured goods, as a significant investor in the Canadian economy, as a shipper from landlocked Alberta, as a global company that takes its contractual responsibilities with customers very seriously indeed, and as an exporter to the Pacific Rim countries, we do not accept our ability to move goods being held hostage to private contractual disputes between employer companies and their employees in the handling business. We accept even less being left out when the government gives an exemption to one group of shippers to the detriment of everybody else.
What is so special about grain, Senator Forest, that it warrants putting a whole score of a non-grain commodity shippers at risk? Why are we to be the guinea pigs in the federal government's experiments in labour relations psychology.
Honourable senators, our dispute is not with the rights of workers to collective bargaining; nor is it with grain shippers, which will have the unfettered right to move their products to markets, although I am somewhat disappointed with the hubris shown by that group when saying that if they get this exemption, every other shipper will benefit in the long run. Yes, they say, in the long run some of us may disappear, but that apparently is for the common good.
Our dispute is with a bill that takes a huge and potentially ruinous gamble with the Canadian economy by taking away the stick of back-to-work legislation in the hope that parties and labour disputes will negotiate in good faith. How naive. How reckless.
Dow's Fort Saskatchewan facility in Alberta is the company's only landlocked world-scale production facility in the world with no direct access to the sea. Reliability of the link to export markets is critical for ourselves and our customers. Our customers have already expressed concerns about our ability as a supplier in the wake of past disputes, and they can always go elsewhere. So can we if we need to.
The current contract for long-shoremen and foremen expires in December, 1998. We are already looking at contingency arrangements in case of a labour dispute. If Bill C-66 becomes law in its current form, we might very well decide we can no longer take the risk of long disputes and decide to move elsewhere, Senator Perrault. Other West Coast facilities in Canada and the U.S. have better records of reliability and are possible alternatives. Frankly, out best option might very well be the Port of Seattle, which enjoys both the infrastructure and a reliable track record. That would be an unfortunate turn of events. Our lease in the Vancouver area represents close to three-quarters of a million dollars a year and our payroll to long-shoremen is $1.2 million a year.
Dow did propose to the West Coast inquiry that final-offer arbitration be adopted as a negotiating model to prevent protracted labour disputes. A similar remedy was debated at length in the other place before being voted down. It may or may not be possible, as Mr. Goffin indicated, at this late stage for the Senate to revisit that remedy, and the CCPA brief outlines other options that honourable senators might want to examine.
I have one last point. We certainly appreciate the opportunity to put our concerns in front of this committee. It should be put on the record, however, that we were denied an opportunity to appear in front of the House of Commons committee. I know members of this committee have the wisdom to take a second look at what can be best described as a misguided attempt at correcting a very bad labour-relations situation in Vancouver Harbour, affecting Canada's reputation as a reliable exporter.
Honourable senators, this is a very important issue, not only for my company, but also for the Canadian economy. It is not one that dealt with in a hurried manner. I certainly urge the Senate to play its critical role as a chamber of sober second thought.
The Chair: Mr. Goffin, you and Mr. Lachance have both mentioned final-offer-selection arbitration. The Sims Report did not recommend that. They felt that if there were too many things on the table, final-offer selection would not be the answer because, as you know, it is a win-lose or win-win situation, unless there was only one final issue left. Could you tell me why you recommend it?
Mr. Goffin: We do not know very much about it. We thought we would know quite a bit about it by this point because, as you know, the National Transportation Act in the late 1980s did introduce final-offer arbitration and we expected it would be used quite a bit in the rail sector but it never really has been.
Final-offer selection certainly has some warts. The situation in the ports and the various options that have been proposed have left us rather frustrated. None of the proposed options is particularly appealing. We did stress final-offer selection. The industrial inquiry included it in the basket of mechanisms that it recommended. Perhaps the industry inquiry's approach was better. It recommended quite a basket of measures that could be applied when a labour dispute at a West Coast port threatened companies such as ours or the economy as a whole.
I cannot say that we have experience with final-offer arbitration nor tell you we feel it is the perfect solution. However, we think it is better than the present situation and would bring a speedy resolution to disputes without an act of Parliament.
The Chair: I agree there are times when it is the answer, particularly in situations where a lot of items have been signed off on an agreement and you are down to an issue that cannot be settled.
[Translation]
Senator Lavoie-Roux: Were you given any reasons as to why you were excluded from the amendments that were brought in? Why will these amendments apply only to grain handling? Were you given a reason for this or was the minister or the government solely concerned about strikes in the grain handling sector?
Mr. Lachance: I think everyone agrees that we are facing a difficult situation in Vancouver and that there is no miracle solution. To continue with the discussion initiated by the Chair, whether we opt for this or another solution, what we are trying to do in essence is to improve labour relations at the Port of Vancouver. This is a praiseworthy objective.
Senator Lavoie-Roux: One that you support.
Mr. Lachance: Of course we support the objective of improving labour relations at the Port of Vancouver. It is not normal for the Parliament of Canada to have to step in to resolve repeated disputes. The problem is the proposed remedy and we are concerned because in our view, this could be very risky. Taking away from one of the parties the opportunity to play this famous trump card will force the parties to bargain in good faith. While this may indeed prove to be the case, what happens if the parties do not bargain in good faith? What happens to the people directly affected by the work stoppage? The grain haulers are protected, but what about the others? We were never consulted and to be quite honest with you, we did try to get answers from the department, but to no avail. I know that I have the support of the departmental representatives. We tried to get our views across to the committee, but we were unsuccessful and to be honest, we are somewhat frustrated. This is really the first opportunity we have had to make our views on the subject known.
Senator Lavoie-Roux: Perhaps your brief was not ready at the time. Did you attempt to make representations in writing to the Department? That is my first point? My second point is this: am I wrong to think that this may perhaps make the situation even more difficult for you, because clearly, strikes that affect the delivery or transportation of grain put enormous pressure on the government? If this pressure disappears, is it not possible that you would face more than just transportation problems at the Port of Vancouver?
Mr. Lachance: You have put your finger squarely on the problem. We have the capacity, albeit limited, to handle 30 trains per day, as I mentioned earlier. For one, two or three days, production can continue. However, can you imagine what will happen after one week? We could no longer go on. The plants have to stop production. I will not go into the details, but shutting down a chemical plant is a fairly complex process. Getting the plant up and running again is even more complicated. This can sometimes take one week. In the meantime, we have to contend with serious problems in terms of our shippers and our customers who might leave the port. We can handle things for one, two or three days. However, after one week, we estimate that a work stoppage at the Port of Vancouver represents losses to our company in the order of $2 million per day. You have accurately described the problem that we face today.
Senator Lavoie-Roux: Perhaps we could call these officials back and ask them why you were excluded. As I understand it, you are pleased that the problem with the grain handlers has been resolved, but not that it was resolved at your expense.
Mr. Lachance: Exactly. We wish the grain haulers all the best. They are quite fortunate in that they are protected, unlike us.
[English]
Senator Cogger: I think you began to answer what would be my question. It is not true to say that chemicals can be stockpiled?
Mr. Lachance: No.
Senator Cogger: Any more so than grain?
Mr. Goffin: No. The last transportation stoppage a couple of years ago, which affected both the rail system and the ports, last long enough that a number of our plants were forced to curtail production. I had heard about the possibility of a stoppage in the transportation sector a number of months before it actually occurred, but I was somewhat surprised by a call from a colleague at NOVA. I asked him why he was calling me about the situation because I had other more pressing issues. He told me that one of his major customers in China had just raised it with him and he was very concerned.
Senator Cogger: Mr. Goffin, I noted that you were present when the grain elevator representatives were testifying. You may not have the answer, but have you any idea what percentage of the total volume of business shipped through the Port of Vancouver is represented by chemicals?
Mr. Goffin: No.
Senator Cogger: They said grain represented approximately 16 per cent; your shipments would represent a much smaller percentage, I assume.
Mr. Goffin: Quite a bit smaller. They listed a number of other commodities that go through the port and we were one of them. We would have to be considerably less.
Senator Cogger: How many people does the chemical industry employ in this country?
Mr. Goffin: In the industrial chemical industry that CCPA represents, we employ about 35,000 people across the country. We are a very capital-intensive sector. We are part of the chemical and chemical products sector, though, which employs upwards of 70,000 people in the country and, of course, we provide basic materials that support many other jobs, such as construction jobs in Alberta on the projects I mentioned that are dependent on those Asian markets. The average salary in our industry is $50,000 per year. They are very good jobs and they are well worth having, even though there are not as many as in some of the labour-intensive sectors.
Senator Cogger: I venture to say that the difference between your industry and the grain industry, frankly, is that the grain industry has a lot of political muscle. I think that is why they are getting the treatment they are getting.
Mr. Lachance: Nobody will ever deny that, senator.
It is a fact, and it has been said a number of times, that the main trigger for getting Parliament to intervene in port disputes is grain. Yes, you may want to describe that as political clout.
Senator Cogger: Is it fair to say -- and this is not political <#0107> that you would be quite happy to keep tying your fate to the grain industry because then the political muscle is there for everybody to share? Once we give the grain industry special status under the bill, then the rest of you will be left out in the cold.
Mr. Lachance: I would express that differently, senator. I would say we would be very happy with a Port of Vancouver that worked in a reliable way.
Senator Perrault: We have heard this doomsday scenario for the Port of Vancouver, the terrible situation which might arise if chemical shipments are tied up for days and days. How many lost days has your company suffered in the Port of Vancouver over the past ten years?
Mr. Lachance: We estimate we have lost about 21 days.
Senator Perrault: Twenty-one days total?
Mr. Lachance: Yes.
Senator Perrault: That is not a bad track record really.
Mr. Lachance: Yes, but that should be put in context.
Senator Perrault: You fear something far worse for the future, do you?
Mr. Lachance: That is correct, because in approximately 9 out of 11 disputes, the labour stoppage was ended after three or four days with back-to-work legislation. By removing this tool one can presume -- and this is why I said this is an exercise in labour relations psychology -- that in the long term the situation might improve. In the short term, however -- and short can be five years -- we may end up with one or two labour disputes that last for two or three weeks.
Senator Perrault: It could cause serious delays, you are suggesting?
Mr. Lachance: Yes.
Senator Perrault: You certainly should have been heard by the other place. I feel your point of view should have been considered.
Senator Cogger: You heard the grain elevator representatives commenting on the importance of maintaining their reputation in Canada as a reliable continuing source, and saying that whenever there is a stoppage we risk losing clients. Canada faces much more competition in businesses like the chemical industry than we do in growing wheat, I suppose. If, say, your export market was endangered because of work stoppages in the harbour, then, I presume, it would be easy for your clients to find another reliable source somewhere. If that is so, where would they go? To the U.S.? To Germany?
Mr. Goffin: The U.S. is a major competitor in the Asian markets. The Saudis are becoming major competitors, and becoming more so in the Asian markets.
A big factor we have in our favour, at least up to now, is reliability. We are considered to be a pretty reliable source, and when we do have a transportation stoppage or even the threat of one, it catches the attention of the customers because they think of Canada as a safe, secure supplier. We do not have wars here, or that type of disruption. It is a big plus, a point in our favour. We need that in our favour to offset the fact we are shipping long distances. We are up against competition from other areas of the world.
In the Asian countries themselves, of course, chemicals and petrochemicals are prime sectors to develop, and a great deal of investment is going into those countries right now.
Senator Maheu: Mr. Lachance made a reference to not knowing where we got the idea that the wheat or grain industry should be favoured in such a way. The Sims Report said:
...because of its importance, the grain industry be declared to be for the general advantage of Canada, under the Constitution Act, and, therefore, within the jurisdiction of the Canada Labour Code. This is not the case with most other commodities.
I think that is why the Sims report recommended not extending it to other industries.
It surprised me to hear an industry as big as Dow Chemical saying that you agree that reforms are needed to protect and enhance Canada's reputation as a reliable supplier in key export markets, but that the solutions should apply across the board, that they should not be limited to just one commodity. How do you correlate that with the long-shoremen's right to strike? Do you say they should not be allowed to strike against any industry at any time and that there should be no lockouts in the Port of Vancouver against any industry that is exporting by ship to another country? How do we work that into any equation?
By doing what you ask, would we not be taking away the right to strike of long-shoremen and losing control over the situation? The problems have been there for a long time. The unions and the companies force the government to legislate them back to work every chance they get.
[Translation]
Therefore, a segment of our population is being denied the right to strike. Am I correct?
Mr. Lachance: With your permission, senator, I will not comment specifically on the right to strike issue because it is not up to me to do so. Our brief does not address specifically the mechanics of labour relations in Canada or the Canada Labour Code. Senator Lavoie-Roux put her finger on the problem that we face. As an exporting company that must use a port of export, we must have confidence in this port's ability to ship products out. Despite the fact that labour relations at the Port of Vancouver have been difficult in the past, the fact that the Canadian Parliament intervened on a regular basis mitigated for us to a great extent the problem of prolonged work stoppages. It is in our best interest to have healthy labour relations at the Port of Vancouver and we maintain that the mechanism or approach advocated in Bill C-66, while likely to improve labour relations in the long term, could in the short term lead to more prolonged labour disputes. If that happens, the impact on our industry and on other industries that are not protected will be devastating. In the coming days and next week, you will be hearing hear from all groups, with the exception of the grain producers, and basically they will be voicing the same concern. We are not opposed to the aims pursued by the government in Bill C-66. We too want to see sound labour relations at the Port of Vancouver. We object to the proposed method which is extremely risky and in the business world that I represent, risk must be mitigated. I want the Senate committee to know that if the Parliament of Canada decides to go with this approach, we will have to react accordingly and mitigate the risks. How we will go about this remains to be seen. We will assess the various options available to us.
Senator Maheu: By dispensing with clause 87.7, we arrive at the same results. The legislation would apply primarily in the case of prolonged strikes.
Mr. Lachance: You have a rather Cornelian choice to make, because you must choose between different options which offer no miracle solutions. I repeat that these various solutions have not really been put to the test yet.
[English]
Binding arbitration is not tested all that often. It is controversial, certainly. What makes anyone think that what I call applied labour-relations psychology in Bill C-66 is a better solution than binding arbitration? Can anybody suggest to me why that would be the case?
The Chair: Perhaps we should designate it as an essential service.
Senator Forest: As an Albertan, I am certainly proud of our petrochemical industry, and if I spoke out of frustration earlier, it was because I have been personally involved in the grain-handling business. Perhaps the reason grain was in the Constitution was because, back in the days when the Constitution was written, there was no petrochemical industry, and because it is food and because of the high volume.
Certainly, as I indicated in my first intervention, I, too, am concerned about fair labour practices. I am also concerned about fair treatment of everyone.
Mr. Goffin spoke about some of the suggestions or recommendations in the Sims report and said that this one was singled out while others were not. I was wondering if there were any he felt might be an alternative solution.
Mr. Goffin: As we said in our submission, we do not deal with labour relations on a regular basis. It is difficult, in this very complex area, to pick out solutions that one thinks will work. It was actually the report of the industrial inquiry commission I referred to.
Senator Forest: I am sorry.
Mr. Goffin: It recommended an entire piece of legislation to deal with this, with a basket of measures that could be applied, ranging from mediation and arbitration through final-offer selection and other processes.
Responding to the previous question posed to Mr. Lachance, it also said that before any of these measures are applied, the minister should consider whether the parties have bargained in good faith, the nature and degree of the harm being inflicted, the duration of the impasse that has been reached, and those sorts of things. The industrial inquiry commission tried to strike a balance here with a basket of measures, and as the previous witnesses pointed out, it included special treatment for grain.
It is difficult to say what might work. Rather than what is in this bill, we would certainly feel better off if the legislation had a basket of measures. Whether those measures would solve the issues for us, I cannot say.
The Chair: Gentlemen, we thank you very much for bringing your concerns to our committee.
Honourable senators, we have with us now, from the Canadian Labour Congress, Nancy Riche, the Executive Vice-President.
Ms Nancy Riche, Executive Vice-President, Canadian Labour Congress: Thank you, senator. With me is Murray Randall, who is currently the executive assistant to the President, Bob White, and formerly was a senior researcher and the staff person who participated in the process of consideration of Bill C-66.
We did not prepare a specific brief for this committee. I do have a statement I would like to read. I think you have copies of our brief to the House of Commons committee. We are certainly prepared to answer questions.
Bill C-66 as it appears before you now is the culmination of a process that has taken over two years, has directly involved three federal ministers, and has consumed countless hours of discussion and consultation.
The involvement of the CLC, the Canadian Labour Congress, in this process has been guided by the insight and experience of representatives of affiliated unions within the CLC whose activities and membership are, in whole or in part, affected by Part I of the Canada Labour Code. Unions representing the airline industry, the trucking industry, rail industry, even the grain industry, and certainly the long-shore industry, all participated in the process.
Above all else, Bill C-66 represents two things: pragmatism and compromise. It is very much a reflection of the task force that reviewed Part I of the code during 1995 and 1996. The task force had the benefit of input from both labour and management, some of it in the form of consensus -- as did Minister Gagliano following the release of the task force report.
Much time and energy have been invested in the process leading to this bill. It does not represent everything either labour or management might have wanted. That is the nature of compromise. Nevertheless, we believe the process was a good one and that, all things considered, the result is acceptable. I think I am on safe ground when I add that FETCO, the federal employers' organization, the CLC's counterpart in the process, feels much the same about both process and outcome.
If Bill C-66 had come before this committee at another time, we would have focused on those areas of the bill that we support as well as those where we believe improvements could be made. As it is, by most accounts, a federal election call is imminent. Given the time and energy that have been invested in the process leading to this bill, it would be a shame to see it die on the Order Paper. Consequently, our sole recommendation to this committee is to urge the Senate to pass Bill C-66 as is, without delay. We believe this will show the respect due to all parties involved in the development of the bill.
While we have just the one major recommendation, we are certainly prepared to speak on the substance of the bill in our appearance today, but we feel very strongly about this.
It is not often that tripartism works, and works well. A number of affiliated unions within the CLC, and a number of companies within FETCO, discussed this for many hours under the chairpersonship of the Department of Labour. Certainly there were areas on which we had incredibly strong disagreement. However, we are prepared to say tonight that we are willing to accept the compromise, as is FETCO, and we urge you to pass Bill C-66 without delay.
The Chair: I am impressed. I think this is the first time I have ever heard a Canadian labour group come before a committee and agree with something the government did in the area of labour legislation. Congratulations.
Ms Riche: It does not mean we are going to vote for them.
It was a tough process. As I say, there are areas that we would never want to see in a bill, but we managed to work ourselves through this.
The Chair: I did not get a chance to ask the department about successor rights because we were running a little short of time. Could you speak to that briefly?
Ms Riche: We would have liked to have seen that in the bill. This is one area we would have liked to have had strengthened, in this time of moving government services into the private sector. We would have liked the bill to say that the union went with the members.
We also wanted a discussion -- which unfortunately was impossible, jurisdictional things being what they are in Canada -- on devolution from federal to provincial governments. We asked for a debate about this, rather than laying it down in black and white.
We think the successor rights part of the bill is a little weak. We would have preferred, when employees were moved from government service to the private sector, that they would take their union with them.
The Chair: Some people felt that the introduction of such a provision would negate such a fundamental right as subcontracting. Do you think there is a concern there?
Ms Riche: Subcontracting would still be possible. However, the union would stay with the members under that subcontract.
A good example of such as situation in the past year is the privatization of air traffic control in NAV CANADA. The employees moved. There was not a great deal of publicity. The union worked with the new company, NAV CANADA, and has remained. There was discussion and agreement on severance from the federal government, and on pensions.
All of these agreements are only for the period of time covered by the contract. When the new contract is negotiated with NAV CANADA as the employer, there may be a completely different situation, but this was a case where successor rights applied.
The Chair: It would all be renegotiated.
Ms Riche: Yes.
Senator Cogger: Ms Riche, somewhere in the bill there is a new provision that will allow the union to use the employers' means of communication to contact off-site workers.
Ms Riche: Yes.
Senator Cogger: If I were you, I would be delighted with that. You say this is a three-party arrangement. Are you sure that business supports that provision?
Ms Riche: I did not say that employers and labour were supportive of everything in the bill. I said it was a compromise.
I think the Chamber of Commerce is opposed to that provision, but then the Chamber of Commerce did not participate in the consultation. In fact, I am not sure how many people they have in the federal jurisdiction. Be that as it may, it is not mandatory that the union be given the list or be given access to the employers' communications system. This issue is to go before the new CIRB, presently the CLRB. I can tell you why we support it.
Some people might interpret this as giving unfair advantage to a union and access to membership, but there is more to the provision than that. It is a recognition of the new workforce and the new workplace. This is not an auto plant. We are seeing incredible changes within the labour market, within the workforce and within the workplace. This is a recognition that many people work at home. It follows Canada's agreement under the ILO regarding freedom of association.
If people are working at home, they cannot be accessed as easily as if they were working in an auto plant or an office building. This bill allows that access so that a union wishing to organize, which is a legitimate and legal process in this country, can be given fair treatment. After all, Canada is a signatory to the ILO convention regarding freedom to associate.
Senator Cogger: It has been suggested somewhere -- I think it was in The Globe and Mail -- that the provisions under the Corporations and Labour Unions Returns Act that require unions to give certain numbers and financial information to Statistics Canada are to be repealed, and that this change came about as a result of pressure by the unions. Is that correct?
Ms Riche: No. We did not participate in any discussion on the CALURA amendment to the bill. That was a departmental decision.
Senator Cogger: The department brought it forward on their own?
Ms Riche: We knew at the end that it was going to be there. I assume you have asked the department and that they have discussed the history of CALURA.
Senator Cogger: We had someone from Statistics Canada testify, and he suggested that this was to save money.
Ms Riche: You all support that, obviously.
Senator Cogger: I am not saying the person was wrong. I am asking you to comment.
Ms Riche: We are still reporting this information.
Mr. Murray Randall, Executive Assistant to the President, Canadian Labour Congress: We are reporting to the Bureau of Labour Information.
Ms Riche: That is all available. If I may give you some history, during the Diefenbaker years there was great concern about international unions, that is to say unions that had headquarters in the United States. The Canadian government wanted to know how much money was going to the United States. There are fewer international unions now, and I suspect the department made this decision merely to save money. That does not mean that unions' financial records or statements and so on are not available. They are quite public. There should be no fear of a hidden agenda.
It was probably a money-saving measure, and we did not object to it.
Senator Perrault: Before you came into the room, a number of groups, including those representing coal, chemical and mining industries, as well as business more generally, expressed dissatisfaction with the bill. Dow Chemical claimed that while Bill C-66 would have the effect of ensuring the movement of grain in port, it would have a negative effect on other commodities.
Could you comment on the allegations that the federal government is discriminating against these other commodities?
Ms Riche: If we had written this bill, we would have had no particular sector declared essential. However, long-shoremen participated in our consultations. Every time they have exercised their legal right to strike in recent years, they have been legislated back to work because grain has that kind of influence.
When we heard that grain was to be treated differently, we checked with our affiliates. The long-shore workers said they were prepared to live with this because they were always legislated back to work anyway, even though they have said they were prepared to move the grain. They did say, however, that the government should be prepared for the potash and chemical and other industries to say they want that provision to apply to them, too.
Senator Perrault: This is what they are doing.
Ms Riche: Of course, they are. We disagree with it on principle. We disagree with anyone being declared essential unilaterally. We do believe, however, that, the unions and the employers in all of these sectors can agree on what is essential or what is an emergency or what needs to get through. There is not a union in the country that would close down an operating room or a hospital or not allow emergency services. When a strike or lockout is inevitable, both parties should sit down and come to an agreement.
I listened to the witnesses from the Canadian Chemical Producers Association. They kept saying that they were not labour relations experts, but that they do not want unions interfering with their industry. Well, it is a fact of life: We are here.
Senator Perrault: Do you think the nature of wheat, as a food commodity, provides some justification for different treatment?
Ms Riche: It certainly does for all the members of Parliament from Saskatchewan, even from my party, yes.
Senator Perrault: If food, for example, is being shipped to an area where there is a severe crop shortage, there could be an aspect to it that might not exist with respect to chemicals.
Ms Riche: If that were the case, if there was a specific emergency, we would not need any legislation. Unions would immediately comply. That would not be a problem if there was an international crisis, even if it were not in the bill. It is food and, clearly, the grain industry was able to obtain that provision, and we supported it, based on the support of the long-shore workers.
Senator Perrault: There has been concern expressed that with so-called free trade now operative, grain shipments might move down the Mississippi, subsidized by the U.S. taxpayer to some extent, or be shipped through Portland and Tacoma. Do you think that is a real danger? We want the jobs for our own people in Canada.
Ms Riche: That was our position prior to the signing of the Free Trade Agreement, and that is certainly possible. If this, in fact, is a way of manoeuvring around that agreement so that grain will continue to move through Canadian ports, then I support what is in the bill.
Senator Perrault: Good. Thanks very much. I appreciate that.
Senator Maheu: I would like your comment on replacement workers. Some have suggested that the unions would file a complaint with the board every time an industry or a company used replacement workers.
Ms Riche: That is difficult to predict. This is a very interesting provision, and nobody seems to know how it will be interpreted. We will not know until the first case is held before the CIRB. The provision is not anti-scab, as we would have wanted. This is not the way we would write anti-scab legislation.
There was recently a strike of Air Ontario flight attendants. They voted 100 per cent to strike. Before the vote was counted, the employer had ads in the paper calling for replacement workers. There was no opportunity to try to resolve the dispute, no third party coming in to try to help. My head tells me I would want to put that sort of provision forward.
Senator Cogger: Does it not bother you that we may be passing legislation which contains a clause -- a key clause -- which, as you rightly say, no-one knows how to interpret?
Senator Perrault: That is true of all sorts of legislation.
Ms Riche: Do not misunderstand me. I did add that we would only have to wait until we get the first case though the CIRB.
Senator Cogger: One case will not be good enough. You will have to wait until you build a body of jurisprudence.
Ms Riche: That is true. Do you disagree with having it in there at all?
Senator Cogger: Surely, it would be better to legislate more clearly and rely less on jurisprudence.
Ms Riche: Absolutely. We would love to write the anti-scab clause but we know we have no hope of getting that opportunity. The employers and the unions are never going to agree on replacement worker legislation.
Senator Cogger: Are you telling me that the wording of this legislation where, the meaning of which no-one knows at this point in time, is the best we can do?
Ms Riche: Yes. I will tell you why that is so and why we want you to pass this bill. It is because the employers and the unions do not agree, and the government, through the Sims task force, is the third party.
Senator Cogger: I realize that. That is the "why". I thought governments were supposed to lead, to govern, and to legislate, and not necessarily wait to be told by a consensus of employers and unions.
Ms Riche: Then I suppose we do not really need courts either.
The Chair: I had brought to my attention a "what if" scenario. What would happen if, say, the telephone companies in this country went on strike and their use of replacement workers was found to be an unfair labour practice so that they were disallowed?
Ms Riche: I think you would get an agreement. The employer would sit down with the union and they would come to an agreement. That is the basis of our whole argument against replacement workers.
The Chair: I want to thank you very much for coming before the committee and for putting your position on the table.
The committee adjourned.