The recent case of GDI Services (Canada) Lp v United Food & Commercial Workers Union, Local 175, 2013 CanLII 67384 (ON LA) is a welcome confirmation that arbitrators lack jurisdiction to make remedial orders against non-parties to the collective agreement.
The case involved the removal of an employee of GDI Services from a property of Oxford, one of GDI’s clients. The Union grieved and alleged that it is alleged that the circumstances of the removal constitute a violation of the Ontario Human Rights Code. One of the orders sought by the Union was against Oxford. The employer brought a preliminary motion arguing that the arbitrator was without jurisdiction to make any orders against Oxford. The arbitrator determined that Oxford could participate in the preliminary motion.
The arbitrator agreed with the employer (and the client) that she had no authority to make any remedial order against a non-party to the collective agreement.
The arbitrator reviewed the collective agreement and concluded that:
It is clear, when these provisions are read together, that the role of an arbitrator appointed under this collective agreement is limited to resolving the differences between the Employer and the Union, and that therefore they are the “parties” to the arbitration proceeding.
The arbitrator observed that she was not a consensual appointment, but rather an appointment under section 49 of the Labour Relations Act, 1995. This fact was not material as the section of the Act was designed to resolve “any difference between the parties to the collective agreement”. Once again, in this case, the parties to the collective agreement are the Employer and the Union.
Arbitrator Parmar held that:
The obvious and natural inference from that is that I have no authority to make any remedial orders in respect of a non-party. This principle was confirmed by Arbitrator Goodfellow, in Toronto (City) v. Toronto Civic Employees Union, Loc. 416, 2001 C.L.B. 13213
She suggests that a party may be added as a party to the arbitration with their consent. However, where the non-party does not consent to be added to the arbitration as a party, the arbitrator has no authority to do so and, of course, no jurisdiction to make any remedy against that non-party. In that regard, Arbitrator Parmar notes:
There is nothing in the LRA (leaving aside section 48(12)(j) for a moment) or the collective agreement which indicates or even suggests I have any authority to add parties to an arbitration proceeding without their consent. The Union has not referred me to any authoritative support for that proposition, statutory or otherwise. This is especially notable because the involvement of other entities in the factual matrix leading up to a grievance is not uncommon in labour relations. A few examples are health benefit insurers, pension plan administrators, and other unions. Despite this fact, I am unaware of and have not been alerted to a single instance of an entity being made a party to an arbitration proceeding without its consent.
The next issue was whether section 48(12)(j) of the Act which gives the arbitrator the power to “to interpret and apply human rights and other employment-related statutes, despite any conflict between those statutes and the terms of the collective agreement.” somehow changed the outcome. The arbitrator found that the outcome was the same since, even the Tribunal, did “not have any authority to make remedial orders against an entity that is not a party to its proceeding”.
Furthermore, the Act did not authorize the arbitrator to add a party to the arbitration proceeding. Although section 36 of the Code authorizes the Tribunal to add parties to proceedings before the Tribunal, section 48(12)(j) did not permit the arbitrator to do so. As the arbitrator put it “affirms arbitral authority to “interpret and apply” human rights legislation, procedural matters, like adding a party, are altogether a different matter.” and further:
In my view, if the legislature intended that section 48(12)(j) was to serve as a means to have section 36 replace section 48 and 49, and broaden arbitral jurisdiction beyond the labour relations parties, it would have clearly said so. In the absence of such, I find that section 48 and 49 continue to apply, and my jurisdiction is limited to addressing the dispute between the parties to the collective agreement.
The arbitrator held that she had no jurisdiction to make any remedial orders against a non-party to the collective agreement, where that non-party did not consent (as in the case before her) to be added as a party to the arbitration.
Significance For Employers
This decision seems, on its face, common sense and consistent with generally held labour relations principles. The case is of significance to employers whose employees work on client sites where the client bans the individual from attending on the premises for one reason or another. These cases are increasingly common in some sectors, and this case, among others, supports the limited scope of the arbitrator’s remedial jurisdiction.