A-1063-87
Alphonse Caron et al. (Applicants)
v.
Canada Employment and Immigration Commis
sion (Respondent)
and
Deputy Attorney General of Canada (Mis -en-
cause)
INDEXED As: CARON v. CANADA (CANADA EMPLOYMENT AND
IMMIGRATION COMMISSION)
Court of Appeal, Marceau, Hugessen and Desjar-
dins JJ.—Montréal, June 6 and July 12, 1988.
Unemployment insurance — Labour disputes — Meaning of
"termination of stoppage of work" in Unemployment Insur
ance Act, 1971, s. 44(1)(a) Whether recent Supreme Court
of Canada decisions disapproving Court's interpretation of s.
44(1)(b) and (2)(a) requiring Court to re-examine interpreta
tion of s. 44(1)(a) — Whether interpretation of "termination of
stoppage of work" as when work largely resumed at variance
with text of statute — Discussion of principles (1) requiring
preservation of government neutrality in labour disputes and
(2) avoiding inequity if employer required to finance strike.
This was an application to set aside an Umpire's decision as
to the date on which a work stoppage ended. Paragraph
44(I )(a) of the Unemployment Insurance Act, 1971 disqualifies
a claimant who has lost his employment as a result of a work
stoppage until the termination of the stoppage of work. The
applicants lost their employment on March 3, 1986 when they
were locked out. On March 29 a new agreement was signed and
many of the employees were recalled. However, April 26 was
the termination date chosen by the Board of Referees and
approved by the Umpire. The Umpire found that operations at
a large aluminum factory could resume only gradually and held
that the end of a work stoppage did not have to coincide with
settlement of the labour dispute which caused it. That was how
subsection 44(1) has hitherto been interpreted. The applicants
asked the Court to reconsider this thinking in light of the recent
Supreme Court of Canada decisions in Abrahams and Hills.
Held (Marceau J. dissenting): the application should be
allowed.
Per Hugessen and Desjardins JJ.: The past interpretation of
subsection 44(1), while logical, was not consistent with the
legislation. The "stoppage of work" referred to in paragraph
44(1)(a) is not the same thing as the loss of employment caused
to a claimant. Subsection 44(1) deals with a chain of causation:
the labour dispute, which causes first, a work stoppage and
second, loss of employment. The dispute and work stoppage
involve a group, but the loss of employment relates to the
individual. Not all employees necessarily return to work when
the work stoppage ends. While a work stoppage always results
from the lack of intent of one of the parties to a service contract
to perform it, loss of employment is independent of intent.
Thus, a work stoppage attributable to a labour dispute cannot
continue in being after the parties have indicated a desire to
resume performance of their contracts and have in fact
resumed performance. If the resumption of work takes place
gradually, the last ones recalled to work continue to be without
employment because of a work stoppage attributable to a
labour dispute. However, they will no longer be disqualified
from receiving unemployment insurance benefits because the
work stoppage resulting from a labour dispute has terminated.
This is in keeping with the purpose of the Act: to provide
benefits for those who are involuntarily unemployed.
Once a labour dispute has ended, the two principles generally
invoked in interpreting section 44—preserving government neu
trality in a labour dispute and avoiding requiring an employer
to finance a strike—no longer apply. The Act resumes its
function of providing benefits to a person who is involuntarily
unemployed.
Per Marceau J. (dissenting): The Supreme Court of Canada
decisions in Hills and Abrahams did not require the Federal
Court to revise its interpretation of "termination of the stop
page of work". The existing interpretation of paragraph
44(1)(a) was well founded.
In speaking of the misuse of unemployment insurance funds.
the concern is to avoid a misuse of funds intended to assist
workers who are unable to immediately replace employment
they have lost, not to compensate employees who are receiving
no wages because they have chosen to be unemployed directly
(strike) or indirectly (lockout). The requirement of government
neutrality is to allow the interplay of economic forces tc
determine the outcome of labour disputes. If the parties them
selves are not required to bear the costs of using strikes and
lockouts, the principle that the parties are equal and indepen
dent would be undermined. The parties must have been aware
that the impossibility of an immediate return to work would be
a consequence of the initial stoppage of work, and was an
integral part of the effects of the strike or lockout, and must
have agreed to it.
STATUTES AND REGULATIONS JUDICIALLY
CONSIDERED
Convention Concerning Minimum Standards of Social
Security, 28 June 1952, (1955), 210 U.N.T.S. 131, art.
69(i).
Convention on Unemployment Insurance, 23 June 1934,
(1949), 40 U.N.T.S. 45, art. 10(2)(a).
European Code of Social Security, 16 April 1968,
(1968), 648 U.N.T.S. 235, art. 68(i).
Federal Court Act, R.S.C. 1970 (2nd Supp.), c. 10, s. 28.
Unemployment Insurance Act, 1971, S.C. 1970-71-72, c.
48, ss. 44, 58(J).
CASES JUDICIALLY CONSIDERED
CONSIDERED:
Abrahams v. Attorney General of Canada, [1983] 1
S.C.R. 2; Hills v. Canada (Attorney General), [1988] 1
S.C.R. 513; (1988), 84 N.R. 86; Canada (Attorney Gen
eral) v. Valois, [1986] 2 S.C.R. 439.
REFERRED TO:
Létourneau v. Canada Employment and Immigration
Commission, [1986] 2 F.C. 82; 17 C.L.L.C. 12,056
(C.A.); Hurren v. Canada (Attorney General) (1986), 69
N.R. 117 (F.C.A.).
AUTHORS CITED
Hickling, M. A. "Labour Disputes and Disentitlements to
Benefits" Unemployment Insurance, 1983.
International Labour Organization Unemployment In
surance Schemes Geneva, ILO 1955.
Shadur, Milton I. "Unemployment Benefits and the
`Labour Dispute' Disqualification" (1950), 17 U. Chi-
cago L. Rev. 294.
COUNSEL:
Guy Martin for applicants.
Guy LeBlanc for respondent and mis -en-
cause.
SOLICITORS:
Sauvé, Ménard et Associés, Montréal, for
applicants.
Deputy Attorney General of Canada for
respondent and mis -en-cause.
The following is the English version of the
reasons for judgment rendered by
MARCEAU J. (dissenting): I regret, but I am
unable to dispose of this application by subscribing
to the approach taken by my fellow judges and
concurring in their point of view. With respect, it
seems to me that the meaning they are seeking to
give to paragraph 44(1) (a) of the Unemployment
Insurance Act, 1971 [S.C. 1970-71-72, c. 481—a
provision with such wide practical effect—is not
only contrary to the well-established precedents of
this Court but cannot be justified by analysis of
the legislation itself.
I should say clearly at the outset that I find it
hard to see how these two recent judgments of the
Supreme Court in Abrahams v. Attorney General
of Canada, [1983] 1 S.C.R. 2 and Hills v. Canada
(Attorney General), [1988] 1 S.C.R. 513; (1988),
84 N.R. 86, well-known and celebrated as they
may have become with lawyers, could be seen as
calling for a re-evaluation of the solutions which
this Court has given to the various problems of
interpretation and application raised by the provi
sions of section 44. I think that from the outset the
Judges of this Court solved the problems of inter
preting the rules giving effect to our unemploy
ment insurance system in the manner suggested by
Abrahams, by favouring the insured whenever pos
sible, and that they have also always been fully
aware of the special reasons of social policy which
led to the adoption of particular rules in the case
of labour disputes, reasons referred to in Hills. In
those two cases the Supreme Court undoubtedly
disapproved the conclusions of this Court as to the
content of the good faith requirement mentioned
in paragraph 44(1)(b)' (Abrahams), and as to the
meaning to be given to the verb "financing" in
paragraph 44(2)(a) 2 (Hills), but on each occasion
it did so after it was persuaded that these conclu
sions which it was to revise were not clearly
required by the language of the Act. I do not feel
that this Court is similarly forced to revise its own
conclusions, and in particular I do not think that
the positions taken on interpretation of the phrase
"termination of the stoppage of work" in para
graph 44(1)(a), which is at issue here, can them
selves be overturned in this way.
One must clearly bear in mind the wording of
subsection 44(1) and paragraph 44(1)(a):
44. (I) A claimant who has lost his employment by reason
of a stoppage of work attributable to a labour dispute at the
44. (I) ...
(b) he become bona fide employed elsewhere in the occupa
tion that the usually follows ....
22 44....
(2) Subsection (I) is not applicable if a claimant proves that
(a) he is not participating in or financing or directly interest
ed in the labour dispute that cause the stoppage of work;
and....
factory, workshop or other premises at which he was employed
is not entitled to receive benefit until
(a) the termination of the stoppage of work ....
This Court has until now always held that deter
mining the time when a stoppage of work attribut
able to a labour dispute terminates within the
meaning of paragraph 44(1)(a) raises a question
of fact peculiar to each case, and that the funda
mental disentitlement imposed by the provision
may continue beyond the actual settlement of the
labour dispute responsible for an insured becoming
unemployed. It has always explained this approach
as follows: there is no denying that in fact the
termination of the work stoppage does not neces
sarily coincide with settlement of the dispute, as
the employees' activities cannot always be resumed
at once; if the legislator had intended that in law,
on the contrary, the position should be otherwise
and the date of termination of the work stoppage
should always be that of the dispute settlement, he
would have said so specifically. "Stoppage of
work" and "labour dispute" are not interchange
able expressions. What the Act requires, the Court
has said, is a determination of a transition point
between the two stages of the period when the
employee is out of work: the first, in which his
being unemployed is attributable to and connected
with the dispute, and when he is not entitled to
benefits, and the second, when the continuance of
his unemployed state results from decisions of the
employer not imposed by the initial work stoppage
itself, and when he is entitled to such benefits.
It is now suggested that these earlier decisions of
the Court, though based on a valid premise corre
sponding to actual reality, are nevertheless at vari
ance with the legislation as adopted; and this
conclusion is based on an analysis of the provision
which I think takes essentially the following form.
It is argued that the "stoppage of work"
referred to in paragraph (a) is unquestionably the
one mentioned in the basic rule, namely a "stop-
page of work" that is not individual but concerted,
collective, which is both effect and cause, the
effect of the dispute and the cause of the loss of
employment, the latter being all that involves and
affects the employees as individuals. Seen in this
way, it is said, the "stoppage of work" can only be
the strike or lockout itself, which obviously cannot
continue after the dispute has been settled. Then
too, it is said, how can this collective "stoppage of
work" continue when the employer has reopened
its doors and, as here, many employees have gone
back to work? What may continue after the dis
pute has been settled is not the "stoppage of work"
caused by the dispute but the loss of employment
of the insured parties which has been in turn
caused by the stoppage of work.
With respect, I must question any reliance on
such an analysis. First—and in my opinion the
discrepancy is a serious one from an analytical
standpoint—it is an analysis which makes no effort
to explain why the legislator used the words "ter-
mination of the stoppage of work" rather than
clearly saying, if he wanted to say so, "termination
of the collective dispute" or "termination of the
strike or lockout". Second, it is an analysis which
gives the phrase "stoppage of work" the strict and
limited meaning associated with the very action of
stopping, a meaning which undoubtedly applies to
a strike but hardly to a lockout, and which is very
difficult to apply to a situation like the present one
where the business finds some means of continuing
to operate, in another way but at full production.
Of course, the work stoppage in question is not
limited to an employee since it is related to a
labour dispute, but it is not the very action of
stopping that is dealt with, it is the factual situa
tion that results and which may be seen as the
interruption, the disappearance of the tasks, the
duties and the work of a number of employees,
following a refusal by the employer to let them
"come to work" or a refusal by the employees to
continue providing their services, which leads to
the loss of employment first of those involved and
then of all employees who are consequently pre
vented from continuing with their duties. Of
course also this "stoppage of work" is the result of
a deliberate act by the employees or the employer,
but while a deliberate act is sufficient for it to
arise, it may very well be—and this is precisely the
point—that a change of intent is not sufficient to
terminate it, since the resumption of activities may
temporarily be impossible. Finally, and most
importantly, it is an analysis which takes for
granted that the "stoppage of work" contemplated
by the provision can only be general, entire, can
only affect all or a major part of the employer's
business, forgetting that the provision actually
speaks of a stoppage of work "at the factory,
workshop or other premises at which [the insured]
was employed ...".
Together with textual analysis of the legislation,
it was also suggested that the line taken by the
Court to date bears no relation to the reasons
leading to imposition of the section 44 disentitle-
ment, and indeed is even opposed to them. Essen
tially what is said, I think, is this. The objectives
which the section 44 disentitlement seeks to attain
are, as Chouinard J. pointed out in Canada
(Attorney General) v. Valois, [1986] 2 S.C.R. 439,
and as L'Heureux-Dubé J. reiterated in Hills, to
ensure that the government remains neutral in a
labour dispute and to prevent the unemployment
insurance fund to which the employer contributes
being used against him. These objectives are only
valid during the dispute; once the labour dispute is
over, the employer's interest has been protected,
there is no further reason for government neutral
ity and the system designed to assist those who are
involuntarily unemployed again becomes appli
cable. To maintain the disentitlement for
employees who are ready to return to work once
the dispute has been settled would simply be illogi
cal and unwarranted.
Here again, I must take the liberty of disagree
ing. The objectives sought by the disentitlement in
section 44, a section which is not peculiar to
Canada since its counterpart is apparently present
in all unemployment insurance legislation,' are
well known and have been repeated many times,
but their application may perhaps not be under
stood by everyone in the same way. I at any rate
do not understand them in the manner suggested
by the reasoning I have just reviewed.
It is true that in speaking of the misuse of
unemployment insurance funds it is often said that
it would be wrong for the employer's contributions
to be used against him, but I think this is only a
3 I the 1934 Convention on Unemployment Insurance, 23
June 1934, (1949), 40 U.N.T.S. 45, it is art. 10(2)(a); in the
1952 Convention Concerning Minimum Standards of Social
Security, 28 June 1952, (1955), 210 U.N.T.S. 131, it is art.
69(i); in the European Code of Social Security, 16 April 1968,
(1968), 648 U.N.T.S. 235, it is art. 68(i); see also as to this the
International Labour Organization publication, Unemployment
Insurance Schemes, Geneva, ILO 1955, at pp. 131-136.
very superficial aspect which in any case is not
necessarily persuasive as such, as it may not be the
only case in which a taxpayer is called on to
contribute to a fund that may eventually be used
to his detriment. The concern is really I think, and
rightly so, to avoid a possible misuse of funds that
are intended strictly to assist workers who are
unable to immediately replace the employment
they have lost, not to compensate employees who
are inactive and receiving no salary because they
have chosen to be so directly (a strike) or indirect
ly (a lockout). In speaking of the requirement of
government neutrality we are again, undoubtedly
for the sake of emphasis, using an expression
which is open to misinterpretation. What is in
question is not the fear of direct or indirect inter
vention by the government in a labour dispute that
may result in a solution to the dispute that is
contrary to the interests of one or other of the
parties. The intention is I think to avoid—and here
again rightly in my opinion—interference with the
interplay of economic forces which should deter
mine the outcome of labour disputes. There is a
cost to the employer and a cost to the employees in
using these ultimate means of resolving labour
disputes, the strike and the lockout, and the system
implies and requires that these costs be borne by
the opposing parties themselves, if not entirely
then at least in the same proportion, otherwise the
principle on which everything is based, that the
parties involved are equal and independent, would
be undermined.
If the nature of the section 44 disentitlement is
really as I have just indicated, do the objectives of
this legislation necessarily require that the disenti-
tlement terminate when the dispute itself is settled,
before a return to work has become possible?—
Certainly not. Clearly the opposite is true. As the
impossibility of an immediate return is simply a
consequence of the initial stoppage of work, it is
necessarily an integral part of the effects of the
strike or the lockout. The parties could not have
been unaware that this would be so when they
decided to resort to their ultimate weapon against
each other, and must necessarily have agreed to it.
Paying unemployment insurance benefits to
employees who are waiting to return to work is,
first, using the unemployment insurance fund to
compensate employees who are not unemployed
without intending and accepting that result in
advance, and second—even more seriously—it is
releasing employees from part of the "cost" of the
strike or lockout without giving similar treatment
to the employer in terms of its "lost earnings" or
the hardship it will suffer.
That is why I feel that the established jurispru
dence of this Court interpreting paragraph
44(1)(a) is well founded and should not be revised.
As the subject decision is in all respects in accord
ance with that jurisprudence, I would affirm it and
dismiss the application.
* * *
The following is the English version of the
reasons for judgment rendered by
HUGESSEN AND DESJARDINS JJ.: This is an
application pursuant to section 28 of the Federal
Court Act' to review and set aside a decision of an
Umpire, which held that the end of the work
stoppage arising from the dispute between the
Reynolds company in Baie -Comeau and the union
representing its employees took place on April 26,
1986. That finding, by the operation of paragraph
44(1)(a) of the Unemployment Insurance Act,
197 1, 5 resulted in the applicants not being eligible
for unemployment insurance benefits before that
date.
The applicants had lost their employment on
March 3, 1986, when the employer ordered a
lockout. On March 29 a new agreement was
signed together with a memorandum governing the
return to work. On the same day 970 employees
were recalled (out of a total of 1,430) and agreed
to return to work.
The date of April 26, 1986 was selected by the
Board of Referees because it was then that "a
significant level of production (71%) had been
reached and 90% of the employees had been
recalled" (Appeal Case, page 158). The Umpire
whose decision is at issue approved this approach.
He said the following:
° R.S.C. 1970 (2nd Supp.), c. 10.
5 S.C. 1970-71-72, c. 48.
It is not always easy to determine just when a work stoppage
ends. Precedent has used the formula of 85% of production
volume and the number of employees who have returned to
work as a good measure of this, but there is no magic percent
age. There is no rule of law that a work stoppage only termi
nates at the very moment when a certain percentage has been
reached. There also is no rule of law that the end of a work
stoppage has to coincide with settlement of the labour dispute
which caused it. The board must take into account all relevant
factors presented to it, information on the gradual return of
employees, arguments by the union and the employer and all
the essential points involved. In the instant case the documents
in the record and the transcript of testimony indicate clearly
that (as may well be imagined) a large aluminium plant cannot
resume operations all at once. The board could not disregard
the employer's statement that operations could only resume
gradually, as the plant's five tanks could not be put into
operation simultaneously. Further, it was not shown that the
company had unnecessarily delayed the resumption of work.
In conclusion, for the reasons indicated above, I cannot
accept counsel for the claimant's argument that the date on
which the work stoppage ends automatically has to be the date
the labour dispute ends. The board analysed the evidence and
set the date at less than a month after the dispute ended, which
I do not feel is unreasonable in the circumstances. I therefore
cannot find that the board of referees made a decision vitiated
by an error of law or made an erroneous finding of fact.
(Appeal Case, pages 192 and 193.)
There is no doubt that the Umpire's decision
was consistent with the precedents set by other
umpires and in some cases affirmed by this Court.
However, the applicants are asking the Court to
reconsider these precedents in light of the judg
ments of the Supreme Court of Canada in
Abrahams v. Attorney General of Canada, [1983]
1 S.C.R. 2; and Hills v. Canada (Attorney Gener
al), [1988] 1 S.C.R. 513; (1988), 84 N.R. 86. Not
without hesitation, and for the following reasons,
we have decided that we must accede to this
request.
Subsection 44(1) of the Act disqualifies a claim
ant who has lost his employment by reason of a
stoppage of work at his workplace; paragraph
44(1)(a) provides that this disqualification ceases
when the work stoppage terminates. The text is as
follows:
44. (I) A claimant who has lost his employment by reason
of a stoppage of work attributable to a labour dispute at the
factory, workshop or other premises at which he was employed
is not entitled to receive benefit until
(a) the termination of the stoppage of work, ...
[The French text indeed speaks first of an "arrêt
de travail" and then of "la fin de l'arrêt du
travail". The English text speaks of a "stoppage of
work" in both places. We do not feel that this
difference has any effect on the meaning that
should be given to the provision and, for the sake
of consistency, we will henceforth use the phrase
"arrêt de travail" exclusively.]
The term "labour dispute" is defined in subsec
tion 44(4) of the Act. Additionally, though
empowered to do so by paragraph 58(f), the Com
mission has never issued any regulation defining
when a work stoppage begins and ends.
The interpretation hitherto given to subsection
44(1) has rested primarily on the proposition that
an effect (the work stoppage) can subsist even
after its cause has ceased. Accordingly, it is
argued, the end of the labour dispute is not the
determining factor and instead one should see
when, on the facts of each case, work has largely
resumed. The logic of the premise is unimpeach
able. In our view, however, and with respect for
the contrary opinion, the conclusion is at variance
with the text of the statute. How can it be said
that there is still an "arrêt de travail" (the English
word "stoppage" seems even stronger) when on the
one hand, the employer has agreed to call its
employees back to work, and on the other hand the
latter have agreed to return and have in fact
returned to work, at least in part? The facts of the
case at bar are a striking illustration of this: if
there was still a work stoppage at the Reynolds
company's operations on March 29, 1986, then
what were the 970 people who returned on that
date doing?
In our opinion it is clear that the work stoppage
mentioned in paragraph 44(1)(a) is the same as
that mentioned in the introductory words of the
subsection, that is, a work stoppage attributable to
a labour dispute. However, it is not the same thing
as the loss of employment caused to a claimant. In
other words, subsection 44(1) does not deal only
with one cause, the labour dispute, and one effect,
the work stoppage, but with a chain of causation:
the first cause, the labour dispute, is followed by
an initial effect, the work stoppage, which in turn
becomes the cause of a second effect, the claim-
ant's loss of employment. The first cause by defini
tion involves a group. The first effect, the work
stoppage, also involves a group: it affects several
employees, usually nowadays all members of the
same bargaining unit. The loss of employment, by
comparison, is always individual, peculiar to each
claimant who as a consequence of the work stop
page no longer has "his" employment. Even
though the general stoppage has ended, it often
happens that some or indeed several employees
continue to suffer its consequences: they still do
not have their jobs back.
However, what essentially characterizes the
section 44 work stoppage and distinguishes it from
the claimant's loss of employment is the aspect of
"intent": a work stoppage due to a labour dispute
always results from the fact that one or other of
the parties to a contract of service does not wish to
perform it. If it is the employer who feels this way,
the stoppage is called a lockout; if it is the
employees who refuse to provide their services, it is
called a strike. In either case it is the lack of intent
which is the essence of the work stoppage. The loss
of employment, on the other hand, is a phenome
non completely independent of intent, which is
capable of affecting both those directly involved in
the work stoppage, the strikers or employees who
are locked out, and those who are not in any way
concerned but who have lost their employment as a
result nevertheless.
In light of this analysis, we feel it cannot be said
that a work stoppage attributable to a labour
dispute can continue in being after the point at
which the parties to the dispute have indicated a
desire to resume performance of their contracts of
service and have in fact resumed such perform
ance. If, as in the case at bar, the resumption of
work takes place gradually and in stages, the last
ones recalled to work will continue to be without
their employment because of a work stoppage
attributable to a labour dispute until the time they
are recalled; however, paragraph 44(1)(a) provides
that their disqualification for unemployment insur
ance benefits ceases as soon as the work stoppage
which is the cause of their being unemployed
terminates, even if its effects continue to exist.
We feel that this approach is also consistent
with the recent decisions of the Supreme Court of
Canada. In Hills, supra, L'Heureux-Dubé J. for
the Court explained as follows the initial justifica
tion relied on by British and Canadian legislatures
for the existence of provisions imposing a dis
qualification from benefits on employees involved
in a labour dispute (at pages 537 S.C.R.; 113
N.R.):
The two principles generally invoked in the interpretation of
s. 44 rest on the proposition that government neutrality should
be preserved in a labour dispute and that it would be inequit
able for an employer's contribution to the Unemployment
Insurance fund to finance a strike against himself. Hickling
[M.A. Hickling, Labour Disputes and Unemployment Insur
ance Benefits in Canada and England (1975)1, at p. 1, puts it
as follows:
The neutrality of the state is to be preserved, and funds to
which employers are compelled to contribute are not to be
used against them.
A short time before, the late Chouinard J.,
speaking for the Supreme Court of Canada,
referred to the same two principles 6 in Canada
(Attorney General) v. Valois, [1986] 2 S.C.R. 439,
at page 444, this time citing M.A. Hickling,
"Labour Disputes and Disentitlement to Benefits",
in Unemployment Insurance, published in March
1983 by the Continuing Legal Education Society
of British Columbia, at page 3.1.1:
The purpose of the unemployment insurance scheme as origi
nally conceived was to afford protection to employees thrown
out of work as a result of economic circumstances. It was not
intended to compensate those who lost their employment
through industrial misconduct; who left their job voluntarily or
without just cause, or who were not available for employment.
Hence the disqualifications under ss. 40 and 41 of the Unem
ployment Insurance Act.
Nor was it the intention of Parliament that the unemployment
insurance fund to which not only the employee, but also the
employer and the state contribute, be used to assist employees
or their unions in labour disputes. The funds to which employ
ers had contributed ought not to be used against them. The
neutrality of the state had to be preserved. Hence the provisions
of s. 44 of the Unemployment Insurance Act ....
Chouinard J. then added:
The author describes the operation of s. 44 as follows at pp.
3.1.1 and 3.1.2:
6 Also referred to by this Court in Létourneau v. Canada
Employment and Immigration Commission, [1986] 2 F.C. 82,
at pp. 88-89; 17 C.L.L.C. 12,056 (C.A.) at p. 12,059; Hurren v.
Canada (Attorney General) (1986), 69 N.R. 117 (F.C.A.), at
p. 119.
Before the claimant is disentitled the onus is on the U.I.C. to
establish
(I) That there was a labour dispute at the premises in
question;
(2) That the labour dispute caused a stoppage of work
there; and
(3) That the claimant lost his employment by reason of that
stoppage.
If those points are established then the claimant is disentitled
to benefit until one of the following events occurs:
(4) The stoppage of work due to the labour dispute has
come to an end; or
(5) he becomes bona fide employed elsewhere in the occupa
tion he usually follows; or
(6) he has become regularly engaged in some other
occupation.
It is true that in Hills, L'Heureux-Dubé J.
explains (at pages 537 to 541 S.C.R.; 113 to 118
N.R.) how these two principles have been criti
cized in legal literature. The fact remains that
since the legislator has chosen not to alter or even
not to repeal this provision, the principles men
tioned continue to lend it legitimacy.
We must now look at the impact which these
principles have on the facts of the case at bar.
On March 29, 1986 the "labour dispute" as
defined in subsection 44(4) of the Act was settled.
At about 3 a.m. on the night of March 29, 1986,
the collective agreement and the memorandum
governing the return to work were signed. At 8
a.m. on the same day 970 of the 1,430 employees
resumed work. The others were recalled in succes
sive batches (Appeal Case, pages 63-70). The
Umpire explained, with evidence in support, "that
a large aluminium plant cannot resume operations
all at once" (Appeal Case, page 193).
Can those who were not called back on March
29, 1986 be said to have continued to be disquali
fied from unemployment insurance benefits
because "the termination of the stoppage of work
attributable to a labour dispute" had not occurred
so far as they were concerned?
We do not think so.
In Hills, supra, L'Heureux-Dubé J. noted at
pages 559 S.C.R.; 140 N.R. that the purpose of
the Act as a whole is to:
... provide benefits to involuntarily unemployed persons ...
[Emphasis added].
We think it is clear that, viewed in light of the
objectives of section 44, once a labour dispute has
ended it is difficult for the government to rely on
the argument arising from its duty of "neutrality".
The Act, on the contrary, resumes its function of
assisting an employee who is involuntarily unem
ployed. We feel that depriving the employee of
such support is on the contrary an act that causes
the government to lose its neutrality. The argu
ment that "an employer does not finance" a labour
dispute is also not a valid ground for disqualifica
tion since the dispute between employers and
employees has for all practical purposes been set
tled. In his article entitled "Unemployment Ben
efits and the `Labor Dispute' Disqualification"
(1950), 17 U. Chicago L. Rev. 294, Milton I.
Shadur 7 says at page 320:
"Neutrality" demands nonpayment of benefits during a dis
pute. After peaceful settlement of a dispute, the need for
"neutrality" of that kind ends, and continued benefit denial
would be decidedly unneutral. Similarly, the "strike financing"
argument is totally irrelevant in determining compensation for
a period after the strike has ended. Finally, the workers'
unemployment between the end of the strike and the end of the
stoppage is scarcely "voluntary" in the same sense as unem
ployment during the strike. Since each week should be exam
ined separately in determining eligibility, none of these theories
requires disqualification after the termination of the dispute.
The disqualification imposed by section 44 can
only apply if there is a labour dispute. Once that
dispute has been settled, this provision cannot be
relied on.
For these reasons we would allow the applica
tion, set aside the subject decision and refer the
matter back to the Umpire to be again decided by
him on the assumption that the work stoppage
terminated on March 29, 1986.
Author cited by L'Heureux-Dubé J. in Hills, supra, at
p. 538 S.C.R.; 114 N.R.
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.