Bill 124 Ruled Unconstitutional
*Written by Zura Nakiwoga, Articling Student at Lee Workplace Law
Introduction:
On February 12, 2024, the Ontario Court of Appeal (ONCA) delivered a landmark decision, Ontario English Catholic Teachers Association v. Ontario (Attorney General), 2024 ONCA 101, on the constitutionality of Bill 124, the Protecting a Sustainable Public Sector for Future Generations Act, 2019. While the majority of the ONCA declared the bill unconstitutional for violating unionized workers' collective bargaining rights, its applicability to non-unionized employees remains intact.
Background:
Bill 124, initiated in 2019, aimed to impose a three-year "moderation period" and compensation restraints on both unionized and non-unionized employees within the public sector. The province, asserting responsible fiscal management, sought to cap total compensation increases at 1% for each 12-month period during this period.
Lower Court's Decision:
The Ontario Superior Court of Justice, following applications by ten labour organizations, ruled in 2022 that Bill 124 substantially interfered with collective bargaining, breaching section 2(d) of the Charter. The court emphasized the lack of meaningful consultation, broad definitions of compensation, and the absence of mechanisms for exemptions as factors contributing to the violation.
ONCA's Ruling:
The ONCA, in its recent decision, reinforced the unconstitutionality of Bill 124 for unionized public sector workers. Justice Favreau highlighted the infringement on section 2(d) rights and the disproportionate impact of the legislation on collective bargaining processes. Notably, the ONCA distinguished Bill 124 from similar laws in other provinces where wage restraint legislation was deemed constitutional because of the circumstances leading up to its passage, as well as the terms of the legislation. The ONCA rejected its justification under section 1 of the Charter because it does not minimally impair unionized employees' right to freedom of association, and because its deleterious effects outweigh its benefits.
Relevance to Non-Unionized Sectors:
Crucially, the ONCA upheld the constitutionality of Bill 124 for non-unionized public sector workers, who do not enjoy rights under section 2(d) of the Charter as they do not bargain collectively or are otherwise represented by a union. This underscores the importance of understanding the nuanced distinctions between unionized and non-unionized employees when assessing the implications of wage-limiting legislation.
Analysis and Commentary:
The ONCA's decision provides valuable insights for unionized employers and employees. It highlights the need for careful consideration of legislative impacts on collective bargaining rights and the importance of meaningful consultation in the development of such laws. For non-unionized sectors, this decision suggests a continued reliance on legislative measures like Bill 124 to manage fiscal responsibilities.
Conclusion:
The ONCA's decision on Bill 124 sets a precedent for the constitutional scrutiny of wage-limiting legislation in Ontario. While unionized workers celebrate the protection of their collective bargaining rights, non-unionized sectors should take note of the upheld constitutionality of Bill 124 in their domain. As Ontario moves to repeal the bill, the aftermath may involve further litigation, leaving questions about financial remedies for affected workers and the broader landscape of wage restraint legislation in the province.
