Date: 20110222
Docket: T-901-10
Citation: 2011 FC 211
Winnipeg, Manitoba, February 22, 2011
PRESENT: The Honourable Mr. Justice Russell
BETWEEN:
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ATTORNEY GENERAL OF CANADA
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Applicant
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and
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ALAN SCHWARK
and
ALLIED SYSTEMS (CANADA) COMPANY
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Respondents
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REASONS FOR JUDGMENT AND
JUDGMENT
[1]
This
is an application for judicial review of the 3 May 2010 Decision of a Referee
appointed under Division XVI – Part III of the Canada Labour Code, R.S.C.
1985, c. L‑2
(Code), whereby
the Referee referred a wage recovery appeal back to the regional director of
the Labour Program for
re-determination.
BACKGROUND
[2]
The First Respondent,
Mr. Schwark, is a former employee of the Second Respondent, Allied Systems (Canada) Company (Allied). Allied is engaged in the interprovincial, extraprovincial and
international transportation
by truck of new and used automobiles.
[3]
Due to an on-the-job
injury in 2004, Mr. Schwark underwent back surgery and was unable to perform
his duties as a truck driver. Following a consultation between the Worker’s
Compensation Board (WCB) and Allied, Mr. Schwark was offered a position with
Allied in a different capacity, specifically as a night security officer, which
he accepted.
[4]
On 22 June 2008, Mr.
Schwark filed a complaint against Allied for non-payment of wages and other
amounts in violation of section 174 of the Code. Inspector Faye Lawson
of Labour Canada (the Inspector) investigated the complaint and subsequently
sent Mr. Schwark a Preliminary Determination of Compliance letter, dated 29
October 2008, and a Notice of Unfounded Complaint, dated 13 November 2008. The
Inspector found that Allied intended to pay Mr. Schwark in accordance with the
agreement reached in its consultation with the WCB, that Allied did pay Mr.
Schwark in accordance with the agreement and that the agreement complied with
the Code. The Inspector also noted that, as Part III of the Code does not
address the issue of indexing, there was nothing that the department could do
for Mr. Schwark in that regard.
[5]
Mr. Schwark appealed
the Inspector’s findings, and the matter was brought before Referee Derek A.
Booth. The Referee rescinded the Notice of Unfounded Complaint and sent the
matter back to the director of the Labour Program (of Labour Canada) for
redetermination by a different inspector in accordance with sections 169, 171
and 178 of the Code; section 19 of the Employment Standards Code of Manitoba;
and sections 40 and 47 of the Workers Compensation Board Act. This is
the Decision under review.
DECISION UNDER REVIEW
[6]
The
Referee found that both the employer and the employee had acted in good faith.
However, he noted that the Inspector did not address Mr. Schwark’s questions
regarding loss of indexing and loss of pension and did not make clear to Mr.
Schwark how he would be able to achieve a higher wage. The Referee also noted
that neither the Preliminary
Determination of Compliance nor the Notice of Unfounded Complaint addressed:
a. subsection 171(1) of the Canada Labour
Code, which provides that “the total hours worked in a week shall not
exceed 48”;
b. section 169 of the Canada Labour Code,
which provides “that no employer will cause an employee to work longer than 8
hours a day, 40 hours in any week”; and
c. subsection 19(1) of the Employment
Standards Code of Manitoba, which provides that “an employer’s management
rights do not include an implied right to require an employee to work
overtime.”
[7]
The
Referee rescinded the Notice
of Unfounded Complaint
and ordered the director of the Labour Program to instruct a different
inspector to recalculate payments, wages, hours of work and benefits in
compliance with the above-noted sections of the Canada Labour Code and
the Employment Standards Code of Manitoba.
ISSUE
[8]
The Applicant
raises the following issue:
Whether the Referee erred in his Decision
to compel the director of the Labour Program to consider section 19 of the Employment
Standards Code of Manitoba in a redetermination of the wage recovery
appeal, given that the employer in question is engaged in a federally regulated
undertaking for which federal legislation has exclusive jurisdiction.
STATUTORY PROVISIONS
[9]
The
following provisions of the Constitution Act, 1867
(U.K.), 30 & 31 Vict., c. 3, reprinted in R.S.C. 1985, App. II, No. 5, are
applicable in these proceedings:
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Powers of
the Parliament
91. It shall be lawful for the Queen, by
and with the Advice and Consent of the Senate and House of Commons, to make
Laws for the Peace, Order, and good Government of Canada, in relation to all
Matters not coming within the Classes of Subjects by this Act assigned
exclusively to the Legislatures of the Provinces; and for greater Certainty,
but not so as to restrict the Generality of the foregoing Terms of this
Section, it is hereby declared that (notwithstanding anything in this Act)
the exclusive Legislative Authority of the Parliament of Canada extends to
all Matters coming within the Classes of Subjects next hereinafter
enumerated; that is to say,
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1.
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Repealed.
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1A.
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The Public Debt and Property.
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2.
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The Regulation of Trade and Commerce.
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2A.
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Unemployment insurance.
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3.
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The raising of Money by any Mode or System of Taxation.
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4.
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The borrowing of Money on the Public Credit.
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5.
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Postal Service.
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6.
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The Census and Statistics.
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7.
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Militia, Military and Naval Service, and Defence.
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8.
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The fixing of and providing for the Salaries and Allowances of Civil
and other Officers of the Government of Canada.
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9.
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Beacons, Buoys, Lighthouses, and Sable Island.
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10.
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Navigation and Shipping.
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11.
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Quarantine and the Establishment and Maintenance of Marine Hospitals.
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12.
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Sea Coast and Inland Fisheries.
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13.
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Ferries between a Province and any British or Foreign Country or
between Two Provinces.
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14.
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Currency and Coinage.
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15.
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Banking, Incorporation of Banks, and the Issue of Paper Money.
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16.
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Savings Banks.
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17.
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Weights and Measures.
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18.
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Bills of Exchange and Promissory Notes.
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19.
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Interest.
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20.
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Legal Tender.
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21.
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Bankruptcy and Insolvency.
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22.
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Patents of Invention and Discovery.
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23.
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Copyrights.
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24.
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Indians, and Lands reserved for the Indians.
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25.
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Naturalization and Aliens.
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26.
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Marriage and Divorce.
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27.
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The Criminal Law, except the Constitution of Courts of Criminal
Jurisdiction, but including the Procedure in Criminal Matters.
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28.
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The Establishment, Maintenance, and Management of Penitentiaries.
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29.
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Such Classes of Subjects as are expressly excepted in the Enumeration
of the Classes of Subjects by this Act assigned exclusively to the
Legislatures of the Provinces.
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And any Matter
coming within any of the Classes of Subjects enumerated in this Section shall
not be deemed to come within the Class of Matters of a local or private
Nature comprised in the Enumeration of the Classes of Subjects by this Act
assigned exclusively to the Legislatures of the Provinces.
Exclusive
Powers of Provincial Legislatures
92. In each Province the Legislature may exclusively make Laws in
relation to Matters coming within the Classes of Subjects next hereinafter
enumerated; that is to say,
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1.
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Repealed.
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2.
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Direct Taxation within the Province in order to the raising of a
Revenue for Provincial Purposes.
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3.
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The borrowing of Money on the sole Credit of the Province
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4.
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The Establishment and Tenure of Provincial Offices and the Appointment
and Payment of Provincial Officers.
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5.
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The Management and Sale of the Public Lands belonging to the Province and of
the Timber and Wood thereon.
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6.
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The Establishment, Maintenance, and Management of Public and
Reformatory Prisons in and for the Province.
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7.
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The Establishment, Maintenance, and Management of Hospitals, Asylums,
Charities, and Eleemosynary Institutions in and for the Province, other
than Marine Hospitals.
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8.
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Municipal Institutions in the Province.
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9.
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Shop, Saloon, Tavern, Auctioneer, and other Licences in order to the
raising of a Revenue for Provincial, Local, or Municipal Purposes.
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10.
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Local Works and Undertakings other than such as are of the following
Classes:
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(a)
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Lines of Steam or other Ships, Railways, Canals, Telegraphs, and other
Works and Undertakings connecting the Province with any other or others of
the Provinces, or extending beyond the Limits of the Province:
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(b)
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Lines of Steam Ships between the Province and any British or Foreign
Country:
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(c)
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Such Works as, although wholly situate within the Province, are before
or after their Execution declared by the Parliament of Canada to be for the
general Advantage of Canada or for the Advantage of Two or more of the
Provinces.
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11.
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The Incorporation of Companies with Provincial Objects.
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12.
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The Solemnization of Marriage in the Province.
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13.
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Property and Civil Rights in the Province.
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14.
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The Administration of Justice in the Province, including the
Constitution, Maintenance, and Organization of Provincial Courts, both of
Civil and of Criminal Jurisdiction, and including Procedure in Civil
Matters in those Courts.
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15.
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The Imposition of Punishment by Fine, Penalty, or Imprisonment for
enforcing any Law of the Province made in relation to any Matter coming
within any of the Classes of Subjects enumerated in this Section.
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16.
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Generally all Matters of a merely local or private Nature in the
Province.
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Pouvoirs
du Parlement
91. Il sera loisible à la Reine, de l'avis
et du consentement du Sénat et de la Chambre des Communes, de faire des lois
pour la paix, l'ordre et le bon gouvernement du Canada, relativement à toutes
les matières ne tombant pas dans les catégories de sujets par la présente loi
exclusivement assignés aux législatures des provinces; mais, pour plus de
garantie, sans toutefois restreindre la généralité des termes ci-haut
employés dans le présent article, il est par la présente déclaré que
(nonobstant toute disposition contraire énoncée dans la présente loi)
l'autorité législative exclusive du parlement du Canada s'étend à toutes les
matières tombant dans les catégories de sujets ci-dessous énumérés, savoir:
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1.
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Abrogé.
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1A.
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La dette et la propriété publiques.
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2.
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La réglementation du trafic et du commerce.
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2A.
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L'assurance-chômage.
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3.
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Le prélèvement de deniers par tous modes ou systèmes de taxation.
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4.
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L'emprunt de deniers sur le crédit public.
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5.
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Le service postal.
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6.
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Le recensement et les statistiques.
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7.
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La milice, le service militaire et le service naval, et la défense du
pays.
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8.
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La fixation et le paiement des salaires et honoraires des officiers
civils et autres du gouvernement du Canada.
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9.
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Les amarques, les bouées, les phares et l'île de Sable.
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10.
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La navigation et les bâtiments ou navires (shipping).
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11.
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La quarantaine et l'établissement et maintien des hôpitaux de marine.
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12.
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Les pêcheries des côtes de la mer et de l'intérieur.
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13.
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Les passages d'eau (ferries) entre une province et tout pays
britannique ou étranger, ou entre deux provinces.
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14.
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Le cours monétaire et le monnayage.
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15.
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Les banques, l'incorporation des banques et l'émission du
papier-monnaie.
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16.
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Les caisses d'épargne.
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17.
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Les poids et mesures.
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18.
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Les lettres de change et les billets promissoires.
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19.
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L'intérêt de l'argent.
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20.
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Les offres légales.
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21.
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La banqueroute et la faillite.
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22.
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Les brevets d'invention et de découverte.
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23.
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Les droits d'auteur.
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24.
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Les Indiens et les terres réservées pour les Indiens.
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25.
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La naturalisation et les aubains.
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26.
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Le mariage et le divorce.
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27.
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La loi criminelle, sauf la constitution des tribunaux de juridiction
criminelle, mais y compris la procédure en matière criminelle.
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28.
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L'établissement, le maintien, et l'administration des pénitenciers.
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29.
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Les catégories de sujets expressément exceptés dans l'énumération des
catégories de sujets exclusivement assignés par la présente loi aux
législatures des provinces.
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Et aucune des
matières énoncées dans les catégories de sujets énumérés dans le présent
article ne sera réputée tomber dans la catégorie des matières d'une nature locale
ou privée comprises dans l'énumération des catégories de sujets exclusivement
assignés par la présente loi aux législatures des provinces.
Pouvoirs
Exclusifs des Législatures Provinciales
92. Dans chaque province la législature pourra exclusivement faire des
lois relatives aux matières tombant dans les catégories de sujets ci-dessous
énumérés, savoir:
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1.
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Abrogé.
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2.
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La taxation directe dans les limites de la province, dans le but de
prélever un revenu pour des objets provinciaux;
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3.
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Les emprunts de deniers sur le seul crédit de la province;
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4.
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La création et la tenure des charges provinciales, et la nomination et
le paiement des officiers provinciaux;
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5.
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L'administration et la vente des terres publiques appartenant à la
province, et des bois et forêts qui s'y trouvent;
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6.
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L'établissement, l'entretien et l'administration des prisons publiques
et des maisons de réforme dans la province;
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7.
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L'établissement, l'entretien et l'administration des hôpitaux, asiles,
institutions et hospices de charité dans la province, autres que les
hôpitaux de marine;
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8.
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Les institutions municipales dans la province;
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9.
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Les licences de boutiques, de cabarets, d'auberges, d'encanteurs et
autres licences, dans le but de prélever un revenu pour des objets
provinciaux, locaux, ou municipaux;
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10.
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Les travaux et entreprises d'une nature locale, autres que ceux
énumérés dans les catégories suivantes:
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(a)
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Lignes de bateaux à vapeur ou autres bâtiments, chemins de fer,
canaux, télégraphes et autres travaux et entreprises reliant la province à
une autre ou à d'autres provinces, ou s'étendant au-delà des limites de la
province;
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(b)
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Lignes de bateaux à vapeur entre la province et tout pays dépendant de
l'empire britannique ou tout pays étranger;
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(c)
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Les travaux qui, bien qu'entièrement situés dans la province, seront
avant ou après leur exécution déclarés par le parlement du Canada être pour
l'avantage général du Canada, ou pour l'avantage de deux ou d'un plus grand
nombre des provinces;
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11.
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L'incorporation des compagnies pour des objets provinciaux;
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12.
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La célébration du mariage dans la province;
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13.
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La propriété et les droits civils dans la province;
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14.
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L'administration de la justice dans la province, y compris la
création, le maintien et l'organisation de tribunaux de justice pour la
province, ayant juridiction civile et criminelle, y compris la procédure en
matières civiles dans ces tribunaux;
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15.
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L'infliction de punitions par voie d'amende, pénalité, ou
emprisonnement, dans le but de faire exécuter toute loi de la province
décrétée au sujet des matières tombant dans aucune des catégories de sujets
énumérés dans le présent article;
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16.
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Généralement toutes les matières d'une nature purement locale ou
privée dans la province.
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STANDARD OF REVIEW
[10]
The Supreme Court of Canada in Dunsmuir v New Brunswick, 2008 SCC 9, held
that a standard of review analysis need not be conducted in every instance.
Instead, where the standard of review applicable to the particular question before
the court is well-settled by past jurisprudence, the reviewing court may adopt
that standard of review. Only where this search proves fruitless must the
reviewing court undertake a consideration of the four factors comprising the
standard of review analysis.
[11]
The
Applicant asks this Court to determine whether federal or provincial
legislation is applicable in the wage recovery appeal. This requires the Court
to consider the division of powers in the Constitution Act, 1867.
The Supreme Court of Canada
held in Dunsmuir, above, that
correctness
review has been found to apply to constitutional questions regarding the
division of powers between Parliament and the provinces in the Constitution
Act, 1867 …. Such questions, as well as other constitutional issues, are
necessarily subject to correctness review ….
[12]
Therefore, the appropriate standard of review is correctness.
ARGUMENTS
The Applicant
[13]
The
Applicant submits that the Referee erred in requiring the regional director of
the Labour Program to consider provincial labour legislation, specifically
section 19 of the Employment Standards Code of Manitoba, when
redetermining the wage recovery appeal at issue.
[14]
Allied
Systems (Canada) is engaged in
interprovincial, extraprovincial and international truck transportation, a
federally regulated undertaking. The Applicant relies on subsection 92(10) of
the Constitution Act, 1867 and the Supreme Court of Canada’s
interpretation of that provision in Consolidated Fastfrate Inc. v Western
Canada Council of Teamsters, 2009 SCC 53, to argue, first, that federal
government has exclusive jurisdiction over federally regulated undertakings;
and, second, that Allied’s transportation business meets the criteria of
subsection 92(10). In addition, the Supreme Court of Canada stated in Bell Canada v Québec (Commission de
santé et de la sécurité du travail du Québec), [1988] 1 S.C.R. 749, [1988] SCJ No 41 at page 751, that “this primary and exclusive jurisdiction precludes the
application to those undertakings of provincial statutes relating to labour
relations and working conditions.”
[15]
Based
on the foregoing, the Applicant submits that, with respect to the wage recovery
appeal at issue, the Canada Labour Code is applicable and provincial
labour relations legislation is inapplicable.
[16]
The
Applicant seeks an order that the Decision be quashed or, in the alternative,
be amended to remove consideration of section 19 of the Employment Standards
Code of Manitoba in the redetermination of the wage recovery appeal.
The Respondent Mr. Schwark
[17]
Mr.
Schwark observes that documents referencing both federal and provincial labour
laws have been entered into evidence. He further observes that, in drafting the
Preliminary Determination of
Compliance letter and the Notice of Unfounded Complaint, Inspector Lawson failed
to refer to section 169 of the Code and to subsection 19(1) of the Employment
Standards Code of Manitoba, even though she referred to provincial
legislation in adjudicating the complaint.
[18]
Mr. Schwark alleges
that the
employment contract, the parties to which were Mr. Schwark, Allied and the WCB,
was changed without his knowledge or consent so that it would conform to the Employment Standards Code of Manitoba respecting
hours of work.
[19]
Should
the Court find that the Referee erred in stating that the redetermination
should be made in accordance with, inter alia, section 19 of the Employment
Standards Code of Manitoba, Mr. Schwark asks that the Court amend the
Decision rather than quashing it, given that the Referee made considerable efforts
in “cutting through all the misrepresentations and half-truths of Allied
Systems.”
ANALYSIS
[20]
The
Court was informed at the hearing that the dispute underlying this application
has been settled to the satisfaction of all parties in that:
a) Mr. Schwark has entered
into settlement arrangements, the terms of which require him not to proceed
further against Allied;
b) Mr. Schwark takes the
position that there is no further case to answer in that this whole application
is now moot;
c) Mr. Schwark has
undertaken to file a Notice of Withdrawal of his original complaint and will
provide a copy to the Applicant in the near future;
d) The Applicant agrees
that the application is now moot and has undertaken to file a Notice of
Discontinuance of this application with the Federal Court upon receipt of a
copy of Mr. Schwark’s Notice of Withdrawal of his complaint;
e) Allied Systems (Canada)
Company has communicated to the Court through Counsel for the Applicant that it
agrees with this result and Counsel for the Applicant has undertaken to file
with the Court a copy of Allied Systems (Canada) Company’s written confirmation
to that effect.
[21]
Given
this significant change in circumstances, the Court agrees with the parties
that this application is now moot.
THIS
COURT’S JUDGMENT is that:
1. The application is
dismissed for mootness.
2. No order will be made as
to costs.
“James Russell”
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