A-302-80
North Canada Air Ltd. (Applicant)
v.
Canada Labour Relations Board (Respondent)
Court of Appeal, Ryan and Le Dain JJ. and
MacKay D.J.—Calgary, October 17; Ottawa,
November 21, 1980.
Judicial review — Labour relations — Application to review
and set aside declaration that two companies considered as
single employer — Norcanair operates a scheduled air service,
chartered services, and "water bombing" services — 95% of
the business of Norcanair Electronics is the servicing of the
electronic equipment of Norcanair — Whether or not Nor-
canair Electronics is a federal work, undertaking or business
— Application dismissed — Federal Court Act, R.S.C. 1970
(2nd Supp.), c. 10, s. 28 — Canada Labour Code, R.S.C. 1970,
c. L- I, s. 133, as amended by S.C. 1972, c. /8, s. I.
Application to review and set aside a decision of the Canada
Labour Relations Board by which North Canada Air Ltd.
(Norcanair) and Norcanair Electronics Limited (Norcanair
Electronics) were declared to be a single employer and a single
business pursuant to section 133 of the Canada Labour Code.
Norcanair operates a scheduled air service, as well as chartered
services, and "water bombing" services. Ninety-five per cent of
the business of Norcanair Electronics involves servicing the
electronic equipment of Norcanair. Norcanair Electronics has
been approved to certify the avionic equipment of Norcanair.
The issue is whether or not Norcanair Electronics is a federal
work, undertaking or business.
Held, the application is dismissed. Norcanair Electronics is
operating a federal undertaking or business. The question
whether a business is a federal one depends on the nature of its
operation. In order to determine the nature of the operation,
one must look at the normal or habitual activities of the
business. The servicing and certification of the avionic equip
ment of the aircraft of Norcanair, which is the habitual or
normal activity of Norcanair Electronics, is a vital or integral
part of the aeronautics undertaking or business of Norcanair. It
is a vital part of air navigation and safety.
Construction Montcalm Inc. v. The Minimum Wage
Commission [1979] 1 S.C.R. 754, followed. Northern
Telecom Limited v. Communications Workers of Canada
[1980] 1 S.C.R. 115, followed.
APPLICATION for judicial review.
COUNSEL:
D. Laird for applicant.
R. T. G. McBain, Q.C. for respondent Canada
Labour Relations Board.
H. Caley for Canadian Air Line Employees'
Association.
SOLICITORS:
Cook, Snowdon & Laird, Calgary, for
applicant.
Barron, McBain, Calgary, for respondent
Canada Labour Relations Board.
Caley & Wray, Toronto, for Canadian Air
Line Employees' Association.
The following are the reasons for judgment
rendered in English by
LE DAIN J.: This is a section 28 application to
review and set aside the decision of the Canada
Labour Relations Board on November 6, 1979
pursuant to section 133 of the Canada Labour
Code, R.S.C. 1970, c. L-1, as amended by S.C.
1972, c. 18, s. 1, by which the applicant North
Canada Air Ltd. ("Norcanair") and Norcanair
Electronics Limited ("Norcanair Electronics")
were declared to be a single employer and a single
business for all purposes of Part V of the Code.
This application is one of two section 28 applica
tions directed against the Board's order of Novem-
ber 6, 1979, the other being A-303-80 [infra, page
407], which is brought against that part of the
order that certified the Canadian Air Line
Employees' Association ("CALEA") as the bar
gaining agent for the employees of Norcanair and
Norcanair Electronics. Because of the close rela
tionship of the two decisions and the somewhat
overlapping nature of the grounds of attack in the
two applications, which were argued together, it is
convenient to set out the common background in
these reasons.
On July 11, 1979 CALEA applied to the Board
for certification as the bargaining agent for a unit
of the employees of Norcanair described as
follows:
All employees save and except Pilots, Accounting and
Secretarial personnel, Supervisors and those above the rank of
Supervisor.
On July 19, 1979 CALEA filed an application
with the Board for a declaration under section 133
of the Code that Norcanair and Norcanair Elec
tronics were a single employer and a single federal
business for all purposes of Part V of the Code.
Section 133 is as follows:
133. Where, in the opinion of the Board, associated or
related federal works, undertakings or businesses are operated
by two or more employers, having common control or direction,
the Board may, after affording to the employers a reasonable
opportunity to make representations, by order, declare that for
all purposes of this Part the employers and the federal works,
undertakings and businesses operated by them that are speci
fied in the order are, respectively, a single employer and a
single federal work, undertaking or business.
At the same time the Union applied to the
Saskatchewan Labour Relations Board to be certi
fied as the bargaining agent for the employees of
Norcanair Electronics.
The usual investigation was carried out for the
Canada Labour Relations Board, and Norcanair
made submissions with respect to the appropriate
ness of the proposed bargaining unit.
On August 10, 1979 the Board rendered a deci
sion in which it dealt with other issues that are not
of concern here, but in the course of its decision it
expressed certain conclusions with respect to the
application for certification and the application for
a declaration under section 133. The Board stated
that it did not require further evidence on the
application for certification, and it made the fol
lowing determination with respect to the bargain
ing unit:
Having considered the material filed and submissions of the
parties, we find the appropriate bargaining unit to be that as
applied for by the union, i.e.
All employees of North Canada Air Ltd., carrying on busi
ness under the trade name and style of Norcanair, except
Pilots, Accounting and Secretarial Personnel, Supervisors
and those above the rank of Supervisor.
The Board further held that a representation vote
was mandatory under section 127(2) of the Code
and that the employees eligible to vote would be all
those in the bargaining unit and employed as of
July 11, 1979, the date of the filing of the applica
tion for certification. Finally, the Board stated that
it would not deal with the application under sec
tion 133 pending the outcome of the application
for certification before the Saskatchewan Labour
Relations Board.
On August 15, 1979 the Saskatchewan Labour
Relations Board advised the Canada Labour Rela-
tions Board that it had adjourned the application
for certification with respect to the employees of
Norcanair Electronics sine die pending disposition
by the Canada Labour Relations Board of the
applications before it. By telex on August 17, 1979
the Canada Labour Relations Board advised the
parties in part as follows:
IN REFERENCE TO THE APPLICATION UNDER SECTION 133 THE
BOARD AFTER CONSULTATION WITH THE PROVINCIAL
LABOUR BOARD OF SASKATCHEWAN HAS DETERMINED TO
GIVE THIS APPLICATION IMMEDIATE ATTENTION.
THE BOARD FINDS IT NECESSARY TO SOLICIT THE WISHES OF
THE EMPLOYEES OF NORCANAIR ELECTRONICS LTD TO
COVER THE EVENTUALITY OF THE BOARD MAKING A DECLA
RATION UNDER SECTION 133 OF THE CODE. THE BALLOTS OF
THESE EMPLOYEES WILL BE SEGREGATED TO FACILITATE
FUTURE IDENTIFICATION. ALL OF THE BALLOTS CAST WILL
BE SEALED PENDING A DETERMINATION OF FILE 555-1248.
THE BOARD INSTRUCTS THAT THE EMPLOYER SUPPLY A LIST
OF EMPLOYEES OF NORCANAIR ELECTRONICS LTD TO MR
GORDON KEELER OF THE WINNIPEG OFFICE AND TO CALEA.
THOSE PERSONS LISTED WILL BE ELIGIBLE TO CAST BALLOTS
IN THE PROCEEDINGS PERTAINING TO THE NORCANAIR
REPRESENTATION VOTE. THE FORMAT OF THE BALLOT
ALREADY AGREED TO IN THOSE PROCEEDINGS WILL SUFFICE
TO INDICATE THEIR WISHES.
THE BOARD ALSO DIRECTS THAT NORCANAIR, NORCANAIR
ELECTRONICS LTD AND CALEA FORWARD TO THE BOARD AND
EXCHANGE BETWEEN THEMSELVES NO LATER THAN WEDNES-
DAY THE 29TH OF AUGUST 1979, COMPLETE AND DETAILED
SUBMISSIONS AS TO WHETHER OR NOT THE OPERATIONS OF
NORCANAIR ELECTRONICS LTD FALL WITHIN THIS BOARDS
JURISDICTION AND SECONDLY WHETHER OR NOT THE BOARD
SHOULD ISSUE A DECLARATION UNDER SECTION 133. AT
THAT TIME THE BOARD WILL CONSIDER WHETHER OR NOT A
HEARING WILL BE NECESSARY.
On the same day notice was given of a represen
tation vote of the employees of Norcanair to be
held on August 22, 23 and 24, 1979, and the
employees of Norcanair Electronics were advised
by the Board that they were eligible to vote in this
representation vote but that their ballots would be
sealed pending a decision by the Board on the
application under section 133.
In September 1979, the parties made written
submissions to the Board with respect to the
application under section 133. Both Norcanair and
Norcanair Electronics took the position that Nor-
canair Electronics was not a federal work, under
taking or business and that it did not meet the
other criteria for a declaration under section 133.
The Board held a hearing on November 5, 1979
and issued the following order on November 6:
WHEREAS, the Canada Labour Relations Board has received
from the applicant an application for certification as bargaining
agent for a unit of employees of North Canada Air Ltd.,
carrying on business under the trade name and style of "Nor-
canair", pursuant to Section 124 of the Canada Labour Code
(Part V — Industrial Relations);
AND WHEREAS, an application, pursuant to Section 133 for
the declaration that for all purposes of the Canada Labour
Code (Part V — Industrial Relations) North Canada Air Ltd.,
carrying on business under the trade name and style of "Nor-
canair" and Norcanair Electronics Ltd., and the businesses
operated by them are respectively a single business, has been
received from the applicant by the Canada Labour Relations
Board;
AND WHEREAS, following investigation of the application
pursuant to Section 133 of the Code and consideration of the
submissions of the parties, the Board is of the opinion that the
businesses operated by North Canada Air Ltd., carrying on
business under the trade name and style of "Norcanair" and
Norcanair Electronics Ltd. are one associated or related federal
works, undertakings or businesses, having common control and
direction and after according to the said employers a reason
able opportunity to make representations thereon pursuant to
Section 133 of the Canada Labour Code, declares that for all
purposes of Part V of the Code, the employers and businesses
operated by them are respectively a single employer and a
single business;
AND WHEREAS, following investigation of the applications
and consideration of the submissions of the parties concerned,
the Board has found the applicant to be a trade union within
the meaning of the Code and has determined the unit described
hereunder to be appropriate for collective bargaining and is
satisfied that a majority of the employees of the employer in
the unit wish to have the applicant trade union represent them
as their bargaining agent;
NOW, THEREFORE, it is hereby ordered by the Canada
Labour Relations Board that:
(a) North Canada Air Ltd., carrying on business under the
trade name and style of "Norcanair" and Norcanair Elec
tronics Ltd. and their businesses are hereby declared to be
respectively a single employer and a single business;
(b) Canadian Air Line Employees' Association be, and it is
hereby certified to be the bargaining agent for a unit
comprising:
all employees of North Canada Air Ltd., carrying on
business under the trade name and style of "Norcanair"
and Norcanair Electronics Ltd. excluding pilots, account
ing and secretarial personnel, supervisors, and those above.
The Board issued reasons for its decision on
December 20, 1979.
This section 28 application attacks the Board's
decision under section 133 on three grounds, which
may be summarized as follows:
(a) The Board exceeded its jurisdiction because
Norcanair Electronics is not a federal work,
undertaking or business subject to the Canada
Labour Code;
(b) The Board exceeded its jurisdiction in treat
ing the section 133 application as an amendment
to the application for certification;
(c) The Board exceeded its jurisdiction by
applying section 133 with retrospective effect.
With respect to the first issue, the facts as
disclosed by the record and found by the Board are
not in dispute. It is clear that Norcanair, which
operates a scheduled air service between various
points within the Province of Saskatchewan, as
well as chartered services and "water bombing"
services, is engaged in a federal undertaking or
business. Norcanair Electronics is engaged in the
business of servicing electronic equipment. Its
principal activity, accounting for some 95% of its
business, is to install, inspect, repair and maintain
the electronic or "avionic" equipment of the air
craft of Norcanair. This equipment, which
includes the black boxes described in the reasons
of the Board as containing "the nerve centre of
different electronic functions found in an aircraft",
is related to such functions as voice communica
tion between ground control and aircraft, the VOR
system, the aircraft radar system, and the opera
tion of the compass heading. The Department of
Transport requires inspections of the avionic
equipment of aircraft at specified intervals, and an
aircraft cannot take off unless its avionic equip
ment has been inspected and certified as being in
conformity with the Regulations. Norcanair Elec
tronics was approved by the Department of Trans
port in 1975 to certify the avionic equipment of
Norcanair. The remaining 5% of the business of
Norcanair Electronics consists of work on the
avionic equipment of three other airline companies
and work for a radio equipment company that is
unrelated to avionic equipment.
The criteria for determining whether an under
taking or business is a federal one were considered
by the Supreme Court of Canada in the Construc
tion Montcalm' and Northern Telecom 2 cases. In
Construction Montcalm Beetz J., delivering the
judgment of the majority of the Court, said at
page 769:
The question whether an undertaking, service or business is a
federal one depends on the nature of its operation: Pigeon J. in
Canada Labour Relations Board v. City of Yellowknife
[[1977] 2 S.C.R. 729], at p. 736. But, in order to determine the
nature of the operation, one must look at the normal or
habitual activities of the business as those of "a going concern",
(Martland J. in the Bell Telephone Minimum Wage case at p.
772), without regard for exceptional or casual factors; other
wise, the Constitution could not be applied with any degree of
continuity and regularity; Agence Maritime Inc. v. Canada
Labour Relations Board [[1969] S.C.R. 851] (the Agence
Maritime case); the Letter Carriers' case.
In the Northern Telecom case, Dickson J., after
referring to the principles enunciated in Construc
tion Montcalm, said at pages 132-133:
A recent decision of the British Columbia Labour Relations
Board, Arrow Transfer Co. Ltd. [[1974] 1 Can. L.R.B.R. 29],
provides a useful statement of the .method adopted by the
courts in determining constitutional jurisdiction in labour mat
ters. First, one must begin with the operation which is at the
core of the federal undertaking. Then the courts look at the
particular subsidiary operation engaged in by the employees in
question. The court must then arrive at a judgment as to the
relationship of that operation to the core federal undertaking,
the necessary relationship being variously characterized as
"vital", "essential" or "integral". As the Chairman of the
Board phrased it, at pp. 34-5:
In each case the judgment is a functional, practical one about
the factual character of the ongoing undertaking and does
not turn on technical, legal niceties of the corporate structure
or the employment relationship.
In the case at bar, the first step is to determine whether a
core federal undertaking is present and the extent of that core
undertaking. Once that is settled, it is necessary to look at the
particular subsidiary operation, i.e., the installation department
of Telecom, to look at the "normal or habitual activities" of
that department as "a going concern", and the practical and
functional relationship of those activities to the core federal
undertaking.
Applying these principles tg the facts of the
present case as found by the Board, I am in
agreement with the Board's conclusion that Nor-
Construction Montcalm Inc. v. The Minimum Wage Com
mission [1979] I S.C.R. 754.
2 Northern Telecom Limited v. Communications Workers of
Canada [1980] 1 S.C.R. 115.
canair Electronics is operating a federal undertak
ing or business. Quite clearly the servicing and
certification of the avionic equipment of the air
craft of Norcanair, which is the habitual or normal
activity of Norcanair Electronics, representing
some 95% of its business, is a vital or integral part
of the aeronautics undertaking or business of Nor-
canair. It is a vital part of air navigation and
safety.
The other grounds of attack—that the Board
exceeded its jurisdiction by treating the applica
tion for a declaration under section 133 as an
amendment to the application for certification and
by giving section 133 retrospective effect—are
grounds which were also raised in the section 28
application (A-303-80) against the Board's deci
sion to certify the Union, and they are rejected for
the reasons given in dismissing that application.
For these reasons I would dismiss the section 28
application.
* * *
RYAN J.: I concur.
* * *
MACKAY D.J.: I concur.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.