Proceedings of the Standing Senate Committee on
Energy, the Environment and Natural Resources
Issue 13 - Evidence - June 3, 2014
OTTAWA, Tuesday, June 3, 2014
The Standing Senate Committee on Energy, the Environment and Natural Resources, to which was referred Bill C- 5, An Act to amend the Canada-Newfoundland Atlantic Accord Implementation Act, the Canada-Nova Scotia Offshore Petroleum Resources Accord Implementation Act and other acts and to provide for certain other measures, met this day at 5:44 p.m. to give consideration to the bill.
Senator Richard Neufeld (Chair) in the chair.
[English]
The Chair: Welcome to this meeting of the Standing Senate Committee on Energy, the Environment and Natural Resources. My name is Richard Neufeld. I represent the province of British Columbia in the Senate, and I am chair of this committee.
I would like to welcome honourable senators and any members of the public with us in the room and viewers all across the country who are watching on television. As a reminder to those watching, these committee hearings are open to the public and also available via webcast on sen.parl.gc.ca. You may also find more information on the schedule of witnesses on the website under "Senate Committees."
I will ask senators around the table to introduce themselves, and I will begin by introducing my co-chair, the senator from Alberta, Senator Grant Mitchell.
[Translation]
Senator Boisvenu: Pierre-Hugues Boisvenu from Quebec.
[English]
Senator Patterson: Dennis Patterson, senator from Nunavut.
Senator Black: Doug Black from Alberta.
Senator Wallace: John Wallace from New Brunswick.
[Translation]
Senator Massicotte: Paul Massicotte from Quebec.
[English]
Senator Seidman: Judith Seidman from Montreal, Quebec.
The Chair: I would like to introduce our staff, beginning with the clerk Lynn Gordon to my left, and our two Library of Parliament analysts, Sam Banks and Mark LeBlanc.
Today we begin our hearings on Bill C-5, An Act to amend the Canada-Newfoundland Atlantic Accord Implementation Act, the Canada-Nova Scotia Offshore Petroleum Resources Accord Implementation Act and other Acts and to provide for certain other measures.
Honourable senators, this bill, whose short title is the offshore health and safety act, was introduced in the House of Commons by the Honourable Lisa Raitt for the Minister of Natural Resources and received first reading on October 24, 2013.
After second reading, it was referred to the House of Commons Standing Committee on Natural Resources, which amended the bill and presented its report to the house on February 12, 2014.
The clerk has distributed a copy of the bill and the clause-by-clause briefing binder from the Department of Natural Resources to your offices. If you do not have these documents with you today or require anything, please ask the clerk.
It gives me great pleasure today to welcome to the first segment of our meeting from Natural Resources Canada, Jeff Labonté, Director General, Energy Safety and Security Branch; Samuel Millar, Senior Director, Frontier Lands Management Division; Anne-Marie Fortin, Senior Counsel, Legal Services; Tyler Cummings, Deputy Director, Frontier Lands Management Division; and from Employment and Social Development Canada, Brenda Baxter, Director General, Workplace Directorate, Labour Program.
Thank you for being here today. Sorry we are a little bit late starting; we couldn't get people to quit talking over in the Senate and so we were a bit late getting here. We appreciate you waiting for us.
I understand Mr. Labonté has to leave after a while, but the other officials will be here. Thank you. The floors is yours, sir.
Jeff Labonté, Director General, Energy Safety and Security Branch, Natural Resources Canada: Thank you very much for the opportunity to present this very important piece of legislation, certainly one that is many years in the making and one we are looking forward to moving forward with and entertaining your questions and comments, and hopefully providing as much information as we can today about the bill.
[Translation]
I am pleased to present this bill together with my colleagues from the Department of Justice and the Department of Natural Resources.
[English]
We have a short presentation deck, and I know the binder is quite thick. It is a very technical bill, some 300 pages, so there is quite a bit of material to cover. Certainly at the house committee there were a lot of questions.
I will run through the presentation fairly quickly in order for you to provide us the opportunity to respond more clearly on other points.
Very broadly, the government has taken steps here to enhance and improve the safety of workers in the environment on the offshore. The amendments are the first step in a broader set of measures that are updating our energy systems across the country. Bill C-22 looks at the offshore platform and liability, as well as nuclear compensation, and subsequent work in the department and other departments is supporting the energy infrastructure in the country.
It is fair to say that the offshore area is a very dynamic part of our energy system in Canada, one we are fortunate to have and one that certainly productively provides energy resources and that has been safely developed over the past 25 to 30 years, growing on a history of a good 20 years of development and exploration before that. That said, the offshore is one of the harsher environments and one of the harsher workplaces one might find one's self today in Canada and, of course, it's an industrial activity in which there's a high degree of technology and activity.
Slide 3 in the presentation deck defines that there is a grey area. In Canada, we have recognized that the offshore is an area in which the federal government and the provincial governments have perhaps disputed jurisdiction and, in the absence of sorting that out, the governments decided in the mid-1980s to work together and work under what we call a "shared management regime." In doing so, each government preserves its view that it's jurisdictionally responsible for the offshore development area and it has resulted in provincial governments in Newfoundland and Labrador and Nova Scotia passing what is called "mirror legislation."
The federal legislation before you has a mirror version in both of those provinces that allow both the provinces and the federal government to present the offshore in a shared way, and we develop the resources in a shared way through a joint regulatory board called the offshore petroleum boards, one in Nova Scotia and one in Newfoundland and Labrador.
Elsewhere in the country, offshore is considered federal territory and has been managed and is regulated by the National Energy Board. We are in the midst of pursuing legislation with the Province of Quebec and have been working on that since about 2011, at which time there was an accord signed between the Government of Quebec and the federal government to share management over the offshore area in the Gulf of St. Lawrence.
So, with that backdrop, when the accord acts were drafted in the late 1980s, they provided for occupational health and safety to be a provincial responsibility. It was a particular area in which the federal act recognized that the workplace was something that provincial labour ministers had responsibility for and the offshore was a workplace of sorts and therefore provincial labour law would apply.
At the same time, it was recognized that operational safety — the safe drilling operations, the safe use of equipment, the safe equipment that's used to store, manage and extract the resources — were operationally an important part of the workplace and were thus considered to be part of the federal legislation, as well as the provincial legislation, that explained the workplace.
The challenge came at a certain point in which the differentiation between occupational health and safety — the workplace for workers — and operational health and safety — the workplace as a set of work activities that take part using systems, machinery, protocols and technology — became a little ambiguous.
There was an accident in Nova Scotia in which a worker was killed, and it was unclear whether it was a workplace issue or an operational safety issue. A period ensued in which both governments tried to understand how to pursue that legally. It became clear that it was ambiguous and not clear which law would apply and the case was closed. The two governments, as well as the Newfoundland and Labrador government, agreed at that point in time, about 10 years ago, that we would work together to clarify that there was no ambiguity in the occupational health and safety area.
This is what led to the bill, and it's what's led to the work that's taken place over the last 10 years.
Moving quickly to Slide No. 4 and the key features of the amendments presented in this bill, the Minister of Natural Resources federally is responsible for the act federally; in counterpart, provincial ministers for occupational health and safety are responsible as ministers of labour for their portion of their provincial bill.
The remainder of the offshore accord acts for both respective provinces are under the responsibility of the Minister of Energy; so if you will, the provincial accord acts have the Minister of Labour and the Minister of Energy sharing responsibility. Federally, the Minister of Natural Resources is responsible for the entire accord act.
Offshore boards, as I mentioned, are independent regulators, and they administer on behalf of both governments. The boards are appointed by the province and the federal government respectively, with an equal number of seats in terms of an independent board, and there is professional board staff with expertise in safety, environment, engineering, and drilling and operational activities.
On Slide 5, a key feature of the amendments related to the act is the notion of passengers in transit. In the offshore area, if one can imagine the workplace, it is some 200 to 300 kilometres offshore. In most instances it's a marine vessel that's anchored, floating and attached to the seabed with a drilling platform and a well, if you will. It's extracting resources and stays stationary while floating in the middle of the ocean, or 300 kilometres offshore.
It is a peculiar workplace. Workers typically leave St. John's by helicopter or by boat, transit for hours to the workplace, are deposited on the platform or on the marine vessel, stay for a period of weeks in which they are on again/ off again over a period of hours. So, the workplace is a rather unique workplace, not unlike large mining camps or other areas where people are flown in. They work in an environment and then they leave, so the workplace is also a place where people live and survive when they are not actually working during rest periods.
The amendments proposed in the bill cover transit, and they recognize that a worker, when they arrive at the workplace in St. John's, that they punch their time clock, they get equipment, they enter a vessel, they enter a helicopter and they begin work as they transit to the workplace. Coverage here in the bill is to recognize that. It's particularly important given that there was a helicopter accident in Newfoundland and Labrador in which a number of people lost their lives. It was quite a significant event, a tragedy of sorts, that of course one would hope would never happen again, but certainly something that this particular bill hopes to ensure that all of the safety precautions are taken to protect workers as much as possible.
Regulations in this particular area are also made with the agreement of the federal Minister of Transport, recognizing that a helicopter is also under the regulatory authority of the Minister of Transport.
There are other features in the bill around appeals and provisions that allow health and safety officers and their work to be appealed. The first appeal, of course, is the designation of a chief safety officer. The bill goes a far way into explaining the role of a chief safety officer, in which the chief safety officer is a member of the board, has important powers that allow them to take decisions around the workplace and safety of workers, as well as the operations.
The legislation also allows for ministers to appoint a special officer in the event that such a case is needed to preserve, investigate and look into things that may be of an exceptional nature that require further attention.
Slide 7, the legislation also clarifies the importance of the safety officer, first to ensure that the safety officer would never hold the position of CEO of the board and to separate safety as an area of activity separate from the functioning of the board as its responsibilities for the environment or its responsibilities for land tenure activities, land tenure being the letting of leases and the management of royalties and structures related to the economic development.
It provides that the safety officer has to provide written authorization for any application in which there is a permit for drilling that is sought or that there's an operational permit sought by an operator. At the same time, the chief safety officer is permitted the ability to make regulatory substitutions should there be a demonstrated ability that the operator satisfies the chief safety officer that a substitution is either equivalent or at a greater level of security.
It's also explicit in the legislation that the safety officer could require the creation of a special occupational health and safety committee to allow workers' input into the safety of their workplace and to allow them to provide provisions, ownership and, if you will, formalized input into the processes related to safety.
We would also recognize that there is the designation of special officers, conditions under which that are specific to labour ministers in the provincial jurisdiction. They would be able to report to ministers directly. These are exceptional powers that are provided for in the act that would allow something to be looked at more carefully in the absence of any other means to look at a particular issue. Again, given the uniqueness of the workplace, the act has been designed to reflect the uniqueness of the offshore workplace and the realities of our offshore in Canada.
There are also a number of consequential amendments in the act related to the Canada Labour Code. My colleague from Labour is here to join us to speak to those, but these are more in line with amendments that have been made to the Labour Code and other pieces of legislation. We are moving to ensure that there is alignment between the legislation that is proposed here: one around the deadline to initiate prosecutions; two, that officials need ministerial permission to testify before administrative proceedings; and, three, sharing of information that may be required in particular areas, but at the same time preserving personal information. Of course, these are what we consider consequential, but we certainly wanted to draw attention to them given that it's another piece of federal legislation that's quite significant.
There are a few other non-occupational health and safety-related amendments included in the bill. Some of these are quite important, although more symbolic, updating references to reflect the name of the Province of Newfoundland and Labrador. Some of the acts that are referenced in the accord legislation reference only the Province of Newfoundland. Others reference updates to provincial and federal statutes that are required.
Certainly there is updating the powers of the operational safety officers and the conservation officers to reflect the powers that are being provided to the safety officers. This is to provide alignment between the safety officers, the environment officers and the operational safety officers. The different officers have different regulatory roles in inspecting the workplace, the operations or the environmental aspects of the drilling program. We want to provide alignment between all the powers that are provided to those officers in their role and the exercise of their duties under the regulatory functions.
In terms of consultations, this is a product of work between Canada, Newfoundland and Labrador, and Nova Scotia. There was a great deal of expert advice from Labour Canada, the offshore petroleum boards, and certainly briefings with the offshore industry, the federation of labour and other labour unions. A number of these consultations that took place over a period of the better part of seven years, as the bill moved its way along. It's fairly complicated. As I mentioned, it's quite a significant undertaking, so there was quite a bit of work that took place within all those groups.
In terms of next steps, the two provincial governments have already passed the legislation in their mirror parts. Bill C-5 in provincial equivalent has already received Royal Assent in both Newfoundland and Labrador, and Nova Scotia. Transitional regulations are expected to be tabled in the House of Commons, as well as the Senate, before the summer recess, or at least before the bill receives Royal Assent.
The regulations that we're proposing are the exact regulations that exist today, as well as some of what are considered guidelines that are contractual obligations provided to operators today to ensure that there's as much clarity as possible about the occupational health and safety. These are considered transitional, and we've provided for a period of five years to update those regulations, and that's provided for in the act.
I'll close on that, Mr. Chair, and invite questions.
The Chair: Thank you. We have a list of questioners. I'll start with one or two.
My notes say that the House of Commons Standing Committee on Natural Resources amended the bill and presented its report to the house on February 12, 2014. Your notes say that provincial mirror laws received Royal Assent in Nova Scotia on May 10, 2013, and in Newfoundland and Labrador on May 16, 2013. That happens to be quite a bit earlier than when the amendments were made in the House of Commons. Just help me a bit here with how that took place and how that's being dealt with.
Mr. Labonté: The bill was introduced under the previous session of Parliament, and the federal bill was actually introduced first. I think it was Bill C-61. Both the provinces of Newfoundland and Labrador, and Nova Scotia tabled within days of the federal legislation. Their bills proceeded through their reviews, passed their houses and received Royal Assent. The session of Parliament closed at that time. It fell into the fall 2013. The bill was reintroduced as Bill C-5, and we picked up from there and continued along the way. We had hoped that the bill would have been, at this point, already passed.
I guess it's a peculiar piece so, Mr. Chair, I'm trying to explain this as best I can. The bills are the same, more or less, in both provinces, but they're not identical. Both of them retain their jurisdictional coherence, if you will.
The Chair: I'm not trying to get difficult here, but they adopted their mirror laws in May 2013. We didn't get first reading until October 2013 in the House of Commons, and it was amended by the house committee. That's what I'm told.
Mr. Labonté: Correct.
The Chair: It was amended long after, almost a year after, the laws receive Royal Assent in the two provinces. Is there much of a difference? Is it just some words? How could they have mirror legislation if, in fact, the bill was amended in the House of Commons after they received Royal Assent in the two provinces? That's the part I'm having difficulty with.
Mr. Labonté: There were 11 amendments made to the bill in the house. A number of them were references to federal legislation which were not included in the provincial legislation because they related to federal legislation. There were references to names and titles in which the provinces had already made changes to those names and titles.
All of the amendments made in the house were serious, but would I not call them substantive policy changes insomuch as they were legal changes. There was a numbering problem in one part of the bill, so there was a number of what we would call administrative and drafting corrections, as opposed to policy changes.
The intent of the bill and the policy substance of the bill remain the same as the two bills that have passed both provincial legislatures.
The Chair: Thank you for that. There was the Wells inquiry, which called for the establishment of an independent safety regulator in the offshore area.
Mr. Labonté: Correct.
The Chair: Can you tell me a little bit about why it was decided not to actually follow that recommendation?
Mr. Labonté: Actually, Justice Wells made 29 recommendations, 28 of which have more or less been implemented and one of which is still awaiting consideration about night flights for helicopters.
Recommendation 29 was the final one. There were two components to the recommendation. Part A, which said, "the governments," plural, should consider the creation of an independent safety regulator and, if not possible, it made recommendation 29(b) which said to do a number of things within the existing legal framework that would essentially create a similar pattern to an independent safety regulator.
Those recommendations included ensuring that the chief safety officer was clear in its role and responsibility; ensuring that it had a separate and clearly indicated budget; to provide separation of the safety functions from the rest of the board's functions; and to provide a number of elements that are included in the bill as we see it today.
I'm not sure, Mr. Chair, of the protocol, but Justice Wells did present before the house committee and had said he was quite satisfied with the direction that the governments were heading. He still preferred 29(a) as the recommendation, but recognized the progress made and it was quite comfortable that the governments had moved forward with 29(b); that the workplace would be safer and that the spirit of his recommendations was being fulfilled by the government.
The Chair: That's very good, thank you.
Senator Mitchell: Thanks very much, it has been very informative. Maybe you said this, but what was the problem with 29(a) that it wouldn't have been accepted?
Mr. Labonté: I think there were a number of factors, and certainly there's no clear-cut answer. There's no clear-cut answer that an independent safety regulator would have led to a safer workplace.
The tragedy was the result of a mechanical failure in a helicopter. A helicopter was flying; its gear box lost its oil; and it didn't fly for the period of time it expected to fly and it crashed. It is a horrible tragedy in which a number of people lost their lives. An independent safety regulator, unfortunately, couldn't have prevented the mechanical failure of an aircraft.
That said, I think there's a concern that was expressed previously in a number of instances as to whether there would be a proliferation of regulators and in which we might actually lead to a less safe workplace in the sense that an independent regulator would take a number of the experts in the board and move them away from the functioning of the board. While their sole purpose would be safety, they would be a bit disconnected from the operational side of the activity on a day-to-day basis.
In doing so, it would likely lead to a number of safety regulators, in which the Nova Scotia government has a shared management regime with Canada, as is the one we're negotiating with Quebec. Nova Scotia had actually expressed the preference for it to stay together. There were a number of factors in which it seemed that it may or may not lead to.
We looked at the reference to recommendation 29(b) that had a lot of the same elements, absent the separation, if you will, wholeheartedly from a physical separation. That would allow for a much more tightened focus on safety, and the board has pursued that with vigour.
Senator Mitchell: It has taken a long time to get here.
Mr. Labonté: Indeed.
Senator Mitchell: You've aged, probably, over the process, which raises the question, at least hypothetically, of whether there was some controversy.
After all the people you've spoken with, the different groups that you've indicated were involved, including labour, could you give us some idea whether there are points that remain controversial, or was it just very technically difficult to mesh two jurisdictions in the two different provinces?
Mr. Labonté: It's actually a number of those things. I have colleagues who were here for longer periods of time. I'll start with making two general points. One of them is that there are three governments working together, and the rhythm of electoral cycles, when you pattern them over three governments, leads to a lot of starting and stopping, starting and stopping. Over an extended period of time, you would see governments in power for a number of years, then there would be an election and there would be reaffirming of the priorities and the process.
The second part was really getting comfortable with the role of the ministers of energy and the ministers of labour, and the role of organized labour unions and companies working together. There was quite a bit of work trying to establish common understanding and comfort around each element within the bill.
At a certain stage in 2006-07, it looked pretty close. At that point, it kind of unraveled in a number of contexts from the provincial perspective, and it moved from being focused on by the minister of energy to the minister of labour. That restarted the process that looked more carefully at it from a labour point of view, as opposed to an energy point of view, and then the delicate balance continued.
It was a bit of the rhythm of cycles of three governments, and a bit of trying to get comfortable with the role of all the different participants.
The product here is remarkably better. It certainly brings clarity to the role of government, the role of the unions, the role of the workers, the role of the employees and the role of the boards. Certainly it's a very technical bill. We think it's a much better product, but it is a long time in the making, for sure.
Senator Black: In a former life, I practised energy law and I had the opportunity, really the privilege, to do a tremendous amount of work in both Newfoundland and Labrador, and the Nova Scotia offshore. Like all of you, I've also had the experience of travelling to offshore rigs. I'm sure any of you who have done that will agree with me that they're terrifying workplaces. I work from the premise, my questions today to you, that safer is not good enough. Safest is best. My questions want to get at that, if you'll bear with me.
In doing your research, are you able to tell us whether the current state now will be comparable to safety standards in the U.K., North Sea, the Norwegian North Sea and the U.S. Gulf?
Mr. Labonté: That's a great question from a comparative point of view. One of the challenges when one does the comparative is the apples to apples comparison.
The closest comparison we can make would be in our U.S. example. In the U.S. example, we hear from our board colleagues and from the workplace that in any of the operations that happenein the Gulf, the drill ships, there are only so many globally that drill, and they are contracted over periods of time. They will move into Canada and will not meet the regulatory standard. They will have to go into dry dock and into the port to get retrofitted and upgraded to be up to snuff for Canadian standards and then head back out. I think that speaks to perhaps the workplace is different. In the Gulf, it's calm and warmer, generally speaking, different water. The North Atlantic is a bit harsher.
In the Norwegian and U.K. case, they are much more similar to the Canadian context, although there are differences in how they regulate and manage, the U.K. and Norway both being unitary states, so you don't have the shared —
Senator Black: I understand that, but my question doesn't relate to the jurisdiction. My question relates to safety standards and protocols. I want to know that what we're going to implement in offshore Newfoundland and Labrador, and Nova Scotia is world-class standard. That's what I want to know. If not, then just tell us where the deficiencies are.
Mr. Labonté: I think we would believe that this is a world-class standard for safety for Canada and that we have done our best working with the organized union labour groups, the boards and the companies to establish the safest workplace we can.
Senator Black: Would industry agree with that statement?
Mr. Labonté: I believe they would.
Senator Black: Very good.
The Chair: Maybe just a bit further to that, Senator Black, this committee did a study prior to your coming on board after the large oil spill in the Gulf of Mexico, because there was chatter about how we should maybe shut down the industry off the East Coast. We did a study and found exactly as Mr. Labonté said. We asked industry. We had a lot of people come and testify that our rules and regulations, if you want to put it in those terms, were as strong or better than anyone's. We felt pretty comfortable in our report recommending that there be no such thing as shutting it down and doing something different and that we have world-class. That's good for you folks to know, too. I'm sure you probably know that.
Senator Massicotte: Thank you for being with us. I must note that when we received the binder with 300 pages, I said, "Wow, this is a heavy one." Then when I got here and I got this handout and it's stapled the wrong way, I thought there was a process of intimidation going on, but I'll persevere.
I always have a hesitancy when people try to make decisions. It's fundamental, in any organization, that you have to know who is responsible for what. Whose forehead has the "X" on it, and who do you shoot if it goes wrong? When people say two governments are responsible, joint, tri-partite, it sounds like a government decision. Is that not only prone to more serious errors and more misjudgment? "I thought you were doing this?" "No, I thought you were doing that."
Mr. Labonté: In fact, that would argue to why we are really hoping that the bill will proceed and receive Royal Assent, because today the boards operate with a set of guidelines and a set of instruments that are contractually provided to the operators and to the companies. Ultimately the companies are responsible for the workplace.
Senator Massicotte: That's what the bill fundamentally says? They're held accountable?
Mr. Labonté: That's right.
Senator Massicotte: They don't know who to report to, but they're still held accountable?
Mr. Labonté: They report to the board, and they're responsible for the workplace. This provides clarity that the boards are legally clearly in the zone of worrying about occupational health and safety, whereas today they graft some provincial legislation, add some Canadian legislation and provide guidelines. This takes all that and cements it into law. The accord acts are clear. Both the federal accord act and the provincial accord acts are clear that the workplace is the responsibility of the companies and that the board is the regulator that's in charge.
Senator Massicotte: Promise?
Mr. Labonté: Promise.
Senator Massicotte: You mentioned this earlier in your materials, and I understand employees in that sector get paid once they're on the rig, once they're on the site, not getting there. They may have to take a helicopter, but they only start getting paid once they're there physically. Therefore, there was an issue, I gather, that you do want to make sure they're covered as an employee. So you're saying that, in spite of the fact they don't get paid for the transportation time, they will be treated as an employee for legal bases. Is that accurate?
Mr. Labonté: Yes, I'm not sure about the payment side.
Senator Massicotte: In the material we have, one of them says that.
Mr. Labonté: The moment they punch their clock onshore, they are working, or they are considered workers. The reason we are quite delicate about the issue of the transportation is that any one of us who gets on a helicopter anywhere in the country is under the Minister of Transport's regulatory regime to be safe in that helicopter. Unlike the offshore, you and I, if we took a helicopter ride over Niagara Falls, don't have a breathing apparatus and special safety harness —
Senator Massicotte: Who is driving it? You or me?
Mr. Labonté: Certainly not me. Maybe we're renting a helicopter.
All the workers have mandatory training they have to take before they get on a helicopter. They have special breathing equipment and a set of regulations that recently came out from the Minister of Transport that put in place extra measures because of the long period of time they fly over water. In the event the helicopter does have to what they call ditch, which is to have a landing on water, which is less than ideal in any circumstance, then there is equipment and abilities for those workers to try to survive the helicopter having to land on water.
Senator Massicotte: This act basically amends the Newfoundland and Labrador, as well as the Nova Scotia.
Mr. Labonté: Correct.
Senator Massicotte: What's the difference? Is there a significant difference how you treat each one?
Mr. Labonté: There are slight differences in terms of the labour aspects, in terms of how the appeal processes work in each province and how the responsibilities segregate. The principles are the same in terms of wanting clarity on these things, but they have slight nuances. The federal law accounts for that in looking at the Newfoundland and Labrador, and Nova Scotia, but their respective acts are not identical to each other. They fit hand-in-glove with the federal.
Senator Massicotte: What precipitated this? What motivated you to finally get this thing done is this helicopter accident of six years ago, I guess?
Mr. Labonté: It actually was before that. There had been a worker in Nova Scotia who had been opening a door that had been installed upside down, and the door malfunctioned and the worker was killed. It was actually one individual that was killed in Nova Scotia that precipitated the work.
Senator Massicotte: The door was offshore?
Mr. Labonté: It was offshore on the platform.
Senator Massicotte: What was the problem there and how does this bill correct that?
Mr. Labonté: The problem was, was it an unsafe workplace, which means it is occupational health and safety? Did the employer create and maintain an unsafe workplace because the door was installed improperly? Or was it an operational safety problem because the door was installed improperly and it was part of the operational undertaking of the offshore rig? It wasn't clear whether it was one or the other and which law applied.
Senator Massicotte: Therefore, the employer got away scot-free because of lack of clarity between the two laws?
Mr. Labonté: I'm not sure if I would say they got away scot-free, but there were issues about how to approach that from a legal point of view and from a response point of view. My Justice colleague might be able to fill in a bit more clarity than that.
Anne-Marie Fortin, Senior Counsel, Legal Services, Natural Resources Canada: I believe there was an issue about prosecuting, because there was no clarity as to which legislation would apply — the Nova Scotia occupational health and safety legislation or the accords acts.
Senator Massicotte: The court said, because of this lack of clarity, we will not make the employer responsible for this accident?
Ms. Fortin: That was back in 1999. You are taxing my memory. My belief is that it did not go to court, and I stand to be corrected on that, but rather it was the Crown prosecution that decided that.
Senator Massicotte: The solution is 300 pages?
Ms. Fortin: Because I have been with this process since the beginning, the solution initially was to amend the act to clarify the regulation-making authorities within the accords acts, and that would have been a couple of provisions in the act.
However, when we got together with the provinces, we landed on the notion that, first of all, occupational health and safety had evolved quite a bit since 1985 when the accords act was first adopted, and there were new regimes in place for occupational health and safety that were developed in the early 2000s and, therefore, every jurisdiction wanted to modernize the thing. That called for much bigger legislation. Because we did not want to have different standards in different jurisdictions, having some kind of a negotiated process and a negotiated product with the view of having the best of all jurisdictions apply, that led to quite a few discussions.
Senator Ringuette: Ms. Baxter, offshore workers in Newfoundland and Labrador, and Nova Scotia, they're under the Canada Labour Code?
Brenda Baxter, Director General, Workplace Directorate, Labour Program, Employment and Social Development Canada: They would be under the accords act.
Senator Ringuette: No, no. Are they under the jurisdiction, in regards to getting union accreditation and so forth? Are they under the federal Labour Code or under the different provincial labour codes?
Ms. Baxter: With regard to the offshore workers, it would be under the provincial; I believe it's the provincial legislation.
Senator Ringuette: So they would be under the provincial legislation?
Ms. Baxter: This is part of what the offshore — the accords act.
Senator Ringuette: Notwithstanding this bill.
Ms. Baxter: So notwithstanding this bill, they would be under the provincial legislation.
Senator Ringuette: So, therefore, they would have been under the provincial legislation in regard to safety in the workplace?
Ms. Baxter: Yes.
Senator Ringuette: The flip side to that in regard to the transportation by helicopter, that would have been a federal regulation in regard to transportation safety?
[Translation]
Mr. Labonté: Yes, that is correct.
[English]
Senator Ringuette: I understand the situation that happened in Newfoundland and Labrador in regard to the helicopter issue, and it was a mechanical failure. Therefore, it would come under the federal jurisdiction, the Department of Transport.
Mr. Labonté: It was investigated by the National Transportation Safety Board, who issued a report with recommendations and the government determined that there would be an inquiry headed by Justice Wells, who held an inquiry.
Senator Ringuette: What was the result of the investigation from Transport Canada?
Mr. Labonté: I think it recognized that there were challenges related to that particular context for helicopters and the regulatory system for approving the flying ability of the helicopters without oil in the gear box, if you will, of which there was a belief that it should run for 30 minutes. It was a global issue in other countries that had also had the same belief. This was an example where it ran for 11 minutes and then the helicopter crashed. So, its design was to run for 30 minutes, and it ran for about a third of the time that was expected.
Senator Ringuette: Essentially, it was an issue of oversight with mandatory inspection by Transport Canada from the responsibility also of the owner of it.
After looking at the issue, understanding that the employees are under the provincial labour codes, this is creating a lot of bureaucracy for a particular situation that should have been resolved a long time ago in regard to the Minister of Transportation and the oversight in regard to regulation.
I find that this is pushing the issue elsewhere, because the provinces already have a code of labour which includes all the workplace safety, like any other provinces.
I find that this is creating a lot of bureaucracy, not necessarily in case of an incident, hopefully not, that this clarifies the delimitation of responsibility, federal and provincial, in regard to workplace safety. Right now we have an official joint administration. From my perspective as a long-time legislator, I find this is really not the way to resolve the issue. I think it further blurs the responsibility of each party and each level of government, too. That's my two cents' worth.
Mr. Labonté: Certainly, I hear the opinion being expressed and the point of view. I think it's important to point out that the legislation was being developed long before the helicopter accident, so it was not developed to respond to the helicopter accident. It was designed to respond to the potential for ambiguity in occupational and operational safety.
I think one can argue there is quite a bit of law here, and it is quite detailed and technical, but it is an attempt to ensure there is no ambiguity between the nature of operational safety and occupational health and safety for the purposes of the offshore. They are one and the same, and should be treated as such.
Senator Black: I think it's important that we draw to the committee's attention the evidence of Mr. Labonté. While I understand, Senator Ringuette, your incredible frustration with this legal complexity, it is, as you pointed out, because there is no jurisdiction. There was never agreement as to who owned the Newfoundland and Labrador offshore, and the compromise was there would be joint jurisdiction and, therefore, mirror legislation. You pointed that out in your evidence, but that's why we have this incredibly complicated process.
Mr. Labonté: It is and, certainly if one pursued that further, the courts have prevailed that the offshore in two instances before the Supreme Court were considered federal. The government determined in the mid-1980s, rather than continue to wrangle over whether or not that applied everywhere, that it would set aside these points and work together with the provinces to ensure that there would be orderly, safe and responsible development of the offshore. It has been tremendously successful in Newfoundland, albeit complicated with the board, certainly more than unitary states like the United Kingdom or Norway, but that's led to 30 per cent GDP in Newfoundland and Labrador, 6,000 jobs, billions of dollars in royalties and revenues.
I recognize, though, that it is complicated, and it is because we continue at each kind of instance of government to maintain jurisdictional authority for this, if you will, and the way of doing so is to set it aside and have mirror legislation and a joint board. The alternative would be for one party to express its authority, and that decision was long before my arrival and one that the government has already taken.
Senator Seidman: I have two questions. The first one is very technical.
In Part III.1 (3), it states:
Subject to section 7 and on the recommendation of the Federal Minister and the Minister of Labour, the Governor in Council may make regulations
(a) defining "danger", "dive site", "diving operation" and "incident . . ."
I would ask you about the definition of "danger" because I was on a committee last year — I'm still on the committee — and what came to our committee last year was a change made to the Canada Labour Code regarding the definition of "danger." I'd like to know what the regulations will be in this bill regarding the definition of "danger."
Mr. Labonté: That would have been Bill C-4.
Senator Seidman: Yes.
Ms. Baxter: What happens with respect to this legislation is, once the legislation is passed, the parties work together to develop the regulations, and one thing they may do in developing those regulations is define a definition of "danger." So the parties would work together to define that definition.
Senator Seidman: You would not automatically use the change made to the Canada Labour Code at the end of last year?
Ms. Baxter: No, that's a separate piece of legislation.
Senator Seidman: That's very interesting. Thank you for straightening that one out.
The other question has to do a little more with what Senator Black was asking you about safety.
We did a recent study on bulk transportation of hydrocarbons on this committee, and we heard about the importance of establishing and regulating a culture of safety within an organization. I notice that this bill involves workers in the safety process. Of course, in general, it would be interesting to know how you see this bill as upholding a culture of safety, but also how involving the worker in the safety process, for example, reporting issues, helps to improve safety?
Mr. Labonté: I'll make some general comments and turn it to over to my colleagues. That is an important feature of the bill that workers are involved and committees are established between the worker and the management structure to provide input. Workers also have the right to refuse work in this bill, so may choose to do so, which are important rights for workers, particularly in the offshore where it's quite harsh and a bit different than any universe we might see in a city-oriented workplace.
Mr. Cummings may be able to speak to the other aspects of how one might develop that safety culture.
The boards, working with the National Energy Board, have been promoting the idea of pushing a safety culture into the context of management systems, the planning systems, the reporting systems and the data kept on what is an incident and what an incident looks like.
We saw interesting representations that demonstrated how you could read certain data and it would look like safety was getting tremendously better, and it had been really just about what was reported. There is the whole element of how one looks at what is safe and how one defines getting safer and what that means, but I will ask Mr. Cummings to answer further.
Tyler Cummings, Deputy Director, Frontier Lands Management Division, Natural Resources Canada: One of the things about which we had discussions with our provincial colleagues was how to create safety culture or create the environment for a positive safety culture.
We think that safety comes first from the operator. They have to create that environment, done in partnership with their workforce, and then the regulator will audit them against what they say they will do. If they say they will have a safe workplace, a workplace where workers are involved, then that is what they will be audited against and that's what the regulator will check to ensure is happening.
We have tried to give them that. We said you must have a safety mechanism; you will be checked against it; and you must demonstrate how that will create the safest workplace possible.
Senator Seidman: Okay.
Ms. Baxter: I could add, as well, that that the OHS regime being put in place here is building on the best of what exists in Newfoundland, in Nova Scotia and in the federal jurisdiction for OHS. There are three basic rights for employees. It's the right to know about what is going on in the workplace, the right to participate and the right to refuse dangerous work.
It is built on what's called the "internal responsibility system," which says that the workers and the employers need to understand. They know their workplace; they know best what is a danger in the workplace; and they work together through the workplace health and safety committee to identify and mitigate those dangers in the workplace to prevent accidents and injuries. This is a key foundation of any OHS legislation that exists in the country. That is part of what builds that safety culture.
Senator Seidman: Thank you very much. You have clarified that for me, Ms. Baxter, so I appreciate that.
Senator Wallace: When I listened to your presentation, Mr. Labonté, I heard that there obviously is a need to administratively and organizationally restructure. As Senator Massicotte pointed out, nobody would argue with making it clear as to who is responsible for what. As you have said, some grey areas are present.
The operators are the ones responsible for the workplace and I'm wondering, as far as matters that would impact the safety on these platforms, how will that be impacted by Bill C-5?
I can see from a structural and organizational point of view all this getting the bureaucracy going in the right direction and resolving conflicts and misunderstandings that could come up between the provincial and federal governments. That obviously makes sense. As a matter of safety and as a matter of the requirements that operators are going to implement, practically speaking, on these units, will that change, if at all, through Bill C-5?
Mr. Labonté: It's a good question. I guess it would start by reinforcing those elements of what is needed and necessary to create a safety culture and safe workplace, one in which there is an ongoing, ever-present commitment to safety and input through processes such as the committees described.
Second, there are new audit powers and new authorities for safety officers that are included in the bill that allow them to take a better look and to spend more time; that are compliant with current law; and that allow them to investigate, to expect, to do things that they need to do to be assured that safety is being taken into account and is driving the agenda.
Certainly, it brings clarity to the legal frame, which I think you referred to as the administrative part. What law applies? That is an important part.
It clarifies what is expected of the chief safety officer. The bill goes into great detail to explain the role of employees, the role of employers, the role of the safety officer, the role of the board and the role of the governments, which may be implicit now. It may be explicit in some instances, but, given that there are different operators and different projects, their understanding of the implicit and the explicit may vary slightly between projects. It is clearer in the bill. It is now written into the law.
We will transition with regulations, and we have started the process of setting up a tripartite committee to actually upgrade the regulations to take into account new changes and new immersions.
We have provided the substitution ability for the chief safety officers so that, if something new and better comes along that meets the conditions of safety that are in the regulations today, then that substitution may be made and the safety officer has that authority.
It's part of our broader regulatory frame that is goal- or performance-based, as opposed to prescriptive. There are elements there — like new authorities and new powers — that will be brought into force the moment the bill receives Royal Assent and comes forward.
Senator Wallace: All of that makes sense. It seems like the organization is in need of restructuring. I'm thinking in terms of the practical matters, the actual day-to-day operations on these platforms and rigs, the equipment standards, the hours of operations standards — all the practical matters that, if something goes wrong, can pose real risk to the workers in that workplace.
Removing confusion obviously makes sense, but it may be that these issues are now covered under provincial legislation and maybe partially federally. Now, it will be wrapped together and clarified. That's fine, but will there be anything other than organizational change? Will there be change to the actual safety standards?
To put it another way, do you believe that, right now, there are risks that exist in the offshore — practical, operational risks — that will be remedied with Bill C-5?
Mr. Labonté: That's a very good question, and I note that you used the word "operational" safety in your commentary, which is already under the accord act and the responsibility of the board. The challenge is: At what point does it stop being operational and start being occupational? That's where the challenge is today.
The first step is to kind of suggest that those two things are one and the same, and that we should treat them as such and import all of the labour law, the best of the breed, if you will, into the accord acts and make it clear that operational safety is occupational health and safety. It is a workplace. The person operating the machinery is working. That's the first part, and I appreciate your comment.
I think one could argue that we have a safe workplace today. The operational activities in the offshore are predominantly good workplaces, and they are developed, driven and run safely. I think that might be a bit of a view that there is no risk, and I think it's fair to say that there is quite a bit of risk that remains and will always remain. The degree of vigilance that one puts into this as an employer, an employee, and a regulator is something that should never be forgotten. Part of what we are trying to move forward with this is to reinforce, yet again, that safety is paramount.
It is, comparatively, quite different from being here or from working elsewhere in an urban environment. I won't say that it is more or less risky than a mining operation or a forestry operation or truck driving or anything else because I think all workplaces have some risk, but I don't want to minimize that it is a unique work environment. We are trying to provide legislation that protects that.
Senator Patterson: There are some clauses in the bill, 45 and 84, which propose new sections to address the duties of suppliers and providers of services for offshore workplaces or on passenger crafts. I was just wondering if you could please outline what is in place currently, if anything, and what will change with these new sections.
Mr. Labonté: Would you mind repeating the sections?
Senator Patterson: Clauses 45 and 84.
Mr. Cummings: These sections will provide specific duties to supply contractors, subs, people who currently have no statutory obligation under an occupational health and safety regime.
Senator Patterson: So it is filling a bit of a gap. Okay.
Senator Massicotte asked about the accident in Nova Scotia that you had referred to that pointed out ambiguities beforehand. I couldn't help but think of the Ocean Ranger disaster. Were there recommendations that came out of that? I know that was some time ago, but did the Ocean Ranger give rise to changes in occupational health and safety regimes at the time? Is that background that's incorporated in this bill?
Mr. Labonté: It was incorporated at least on some levels, and I could turn to my colleagues who have perhaps a bit longer tenure on the particular project than I.
Certainly, one of the recommendations following the Ocean Ranger was the opposite of Justice Wells recommendation, which was that we ought to have a really strong, independent, integrated regulator that takes safety into account in the operation and planning of the projects. With that said, from an occupational health and safety point of view do you recall, Ms. Fortin?
Ms. Fortin: With regard to the Ocean Ranger, as Mr. Labonté said, the recommendation was to have one shop to address all of the issues. At the same time, when the accords were adopted, the social legislation aspect of things was given, in the negotiations of the accords, to the provinces and that led to the provincial occupational health and safety legislation applying. In that regard, many years later, it became apparent that the disassociation between occupational health and safety and operational safety was a bit of a fake distinction because it's very difficult to disassociate the two, as Mr. Labonté was saying. Therefore, that's what this bill is trying to address.
It's taking away — and that was with the agreement of the provinces — their jurisdiction over some part of the social legislation that deals with safety and bringing it under the umbrella of the accord, which was one of the goals of the Ocean Ranger recommendations.
Senator Patterson: Thank you. That's very interesting.
[Translation]
Senator Boisvenu: To begin, I would like to welcome the witnesses.
Ms. Baxter, thank you for your presentation and your very clear answers. Given the complexity of the topic involving two levels of government, offshore operations, it is not obvious.
I worked for a number of years in workplace health and safety, and I was trying to draw a parallel with what is done in Quebec. Here we are really saying that, on job sites, joint employer-employee health and safety committees would be set up, where the level of risk could be determined.
In Quebec, businesses that have set up these committees have seen a marked decrease in CSST contributions because workers have been very much involved.
Is it true that this bill has at its heart concerns about the health and safety of workers as well as a reduction in costs? We know that when someone is injured and receives long-term CSST benefits, it is the employer who has to pay, often equally.
Does the bill consider the possibility of reducing accident-related contributions, or is that an outcome you are hoping for?
[English]
Ms. Baxter: In general, this is trying to protect the safety of the workers and an outcome of that could be a reduction in overall costs from injuries, but the focus of this is to improve the health and safety in workplaces for those workers.
[Translation]
Senator Boisvenu: In Abitibi, the cost of health and safety for miners was $64 per $100 worked when CSST was put in place. That is enormous compared to an office setting where the cost was $3 or $4 per $100 paid. Obviously, the health-related costs on an offshore platform must be enormous because of the level of risk, the isolation, the temperature and the travel. Clearly, businesses that operate in that area have an interest in protecting health and safety.
Now, my second topic is the special officer. What is the special officer's day-to-day role? I did not really understand it. Is it a permanent position on a platform or with a company? How will the special officer's prevention-related and other roles be carried out?
Mr. Labonté: There are two aspects to the answer. First, it is true that there are costs associated with CSST action. At the same time, there are a lot of resources in petroleum development in offshore areas.
Senator Boisvenu: There is a counterbalance.
Mr. Labonté: Yes. At the same time, it is true that there are costs, considerable expenditures, and that there is no increase in the level of health and safety. There is not exactly a correlation between the two. It is true that it is important to understand that aspect.
Ms. Fortin could answer your question about the role of the special officer.
Ms. Fortin: The inspection duty will remain with the delegate responsible for safety and with the officers.
The role of the special officer will come into play only if the two levels of government decide that there is an absolutely extraordinary situation that warrants going above the delegates, who are employees of the offices, and their staff to deal with a truly exceptional situation that requires the intervention of someone else.
Senator Boisvenu: Does that person intervene after an accident or before an accident occurs?
Ms. Fortin: Both situations are possible. The trigger is a test, namely, whether there are reasonable grounds to believe that action by a special officer is required to avoid a serious risk to the health and safety of employees in the offshore area within the near future.
Senator Boisvenu: So the role is preventive.
Ms. Fortin: Preventive and proactive, and if things had already happened, it would not prevent the appointment.
[English]
The Chair: Thank you. I have one quick question about the deep water offshore in the Beaufort, which is regulated by the NEB, I assume. Would the occupational safety of those workers out there under the NEB mirror what we have here, other than the nuances between Newfoundland and Labrador, and Nova Scotia?
Ms. Baxter: They would fall under the Canada Labour Code and the associated oil and gas regulations.
The Chair: Okay. Would they be as good as these 300 pages that we just have gone through? That's the question.
Ms. Baxter: This piece of proposed legislation builds on the actual unique circumstances of the Atlantic offshore and addresses the safety concerns and makes adjustments to that unique circumstance.
The Beaufort falls under the Canada Labour Code. As we said, this Atlantic offshore builds on the best of the Canada Labour Code and the Nova Scotia and Newfoundland occupational health and safety legislation.
The Chair: I gather from those answers that it won't be as good. I'm trying to get an answer that says we care as much about those offshore workers under the National Energy Board in the Beaufort, as we care about those workers off the east coast. That's blunt, but that's where I'm coming from.
Ms. Baxter: For developments in the Beaufort, we would be looking closely at the offshore regime for those unique circumstances.
The Chair: Well, they are looking at it now. As I understand, it took 15 years to get this bundle together, and they are looking at the offshore now. It's probably going to happen relatively soon, from what I understand. Can you adapt quickly? I'm still not getting an answer.
Maybe you are telling me that workers who would be in the Beaufort under the National Energy Board will not be covered as well as these workers. I'm not getting that answer.
Mr. Labonté: From an energy policy point of view, workers in the offshore in Canada should all have a safe workplace. The NEB context for the Beaufort is completely federal jurisdiction. The ambiguity between occupational and operational does not exist because it's all federal. The regulatory context that underpins the offshore Atlantic will also underpin the better part of the offshore in the Beaufort.
The difference we're making is that there may be unique circumstances in the Beaufort that merit regulatory changes when we get to that point, when there'll be development sustained over longer periods of time. Certainly, for exploration drilling and activities of that nature, the regulatory environment is equally strong for the Beaufort that will be used as it exists today in the Atlantic offshore — should there ever be platforms out of there permanently and the cold weather environment —
The Chair: The cold weather is there.
Mr. Labonté: It may merit adjustments to the regulatory context. At this time, there are no operational development activities in the North.
The Chair: I understand then that the regulations and the occupational health rules that would apply in the Beaufort would be similar to what we have here, other than the nuances that happen between Newfoundland and Labrador and Canada, and Nova Scotia and Canada.
Mr. Labonté: Indeed, they are.
The Chair: Okay. Would it be what is there now?
Mr. Labonté: Under operational activities that occur under the board to regulate what would happen in the North when the Arctic applications come in, the regulations for drilling, diving, platform work and whatnot, which exist today, are the same regulations used in Atlantic Canada. There are modifications that suit the Atlantic that are appropriate in that context. The labour code for oil and gas operations is predominantly used today for onshore oil and gas operations, but has the elements and authorities for offshore. I would say they are not exercised as much, given there is more work onshore than offshore. It is an area over the next five years that we need to look at.
[Translation]
Senator Boisvenu: I have a very important point, Mr. Chair. Would the Old Henry deposit between Newfoundland and Quebec be covered by a similar agreement?
Mr. Labonté: That is an interesting aspect. We currently have an agreement with the Province of Quebec concerning the shared management of the Gulf of St. Lawrence. The bill is not done yet. Discussions are currently under way with the province. We plan to table a bill on the Gulf of St. Lawrence area soon.
Senator Boisvenu: I understand that every time a province does offshore work, be it British Columbia, Quebec, or another province, a specific bill is required.
Mr. Labonté: Yes.
Senator Boisvenu: Could we not have an umbrella bill for Canada that the provinces could be integrated into, in order to simplify things?
Mr. Labonté: A bill does exist for Canada, but when you establish an agreement with one province, it is specifically for a shared area with one province.
[English]
The Chair: Thank you. This has been interesting and enlightening; and we appreciate your time very much.
We're adjourned.
(The committee continued in camera.)