Definitive Report - REPORT_NO287, June 1993

1. 97. In a communication dated 17 September 1992, the Economists', Sociologists' and Statisticians' Association (ESSA) submitted a complaint of violations of freedom of association against the Government of Canada.
2. 98. The Government sent its observations on the case in a communication dated 25 January 1993.
3. 99. Canada has ratified the Freedom of Association and Protection of the Right to Organize Convention, 1948 (No. 87). It has not ratified the Right to Organize and Collective Bargaining Convention, 1949 (No. 98) or the Labour Relations (Public Service) Convention, 1978 (No. 151).

A. The complainant's allegations

1. 100. In its complaint ESSA alleges that the Public Service Reform Act (hereinafter referred to as the PSRA) which was still a Bill at the moment of the lodging of the complaint and which was introduced without prior public hearings on the Government's general public service reform proposals, would deprive thousands of federal public service employees of the freedom of association and bargaining rights that are upheld by Conventions Nos. 87 and 151.
2. 101. More specifically, ESSA submits that certain provisions in the PSRA would deprive many employees in the federal public service of their present collective bargaining rights by allowing the Government to reclassify them as "managers" and thus rendering them ineligible to join or remain members of recognized employee associations.
3. 102. Legislation pertaining to the federal public service currently allows the overwhelming majority of employees to organize and bargain collectively. Those excluded from these rights are generally limited to the police and the military, temporary employees, contract workers and persons "employed in a managerial or confidential capacity", the latter being defined to embrace those in highly confidential positions, those "directly involved" in collective bargaining or dealing "formally" with grievance processing on behalf of the employer, or those with "executive duties and responsibilities in relation to the development and administration of government programmes" (section 2 of the Public Service Staff Relations Act (PSSRA)).
4. 103. According to ESSA, the PSRA would substantially expand these management exclusion clauses and thus restrict the freedom of association of many professional employees now members of the ESSA or other public service unions. Section 32 of the PSRA amends the definition of "employee" in section 2 of the PSSRA to exclude "a person who occupies a managerial or confidential position", defined to include, inter alia, a position classified by the employer as being in the executive group, by whatever name called; any employee of the Treasury Board; or defined as such pursuant to a new section 5.1 in the PSSRA. The new section 5.1 instructs the Public Service Staff Relations Board (PSSRB) which administers the Act, to identify, as a managerial or confidential position, any position "involving participation to a significant degree in the formulation and determination of any policy or programme of the Government of Canada".
5. 104. ESSA contends that the imprecise language of the above provisions leaves undue discretionary authority to the employer and the PSSRB. Also of concern to ESSA is the expanded definition of those excluded from bargaining rights on the ground of their confidential duties. The PSRA expands this category to include all employees of the Treasury Board, including many not assigned to collective bargaining or grievance processing. There is great potential for abuse in such provisions, given, for example, the ever-present temptation for the employer to spread its grievance response mechanism broadly as a means of expanding the number of excluded employees.
6. 105. ESSA goes on to explain how the expanded "management and confidential" exclusion clause will be used to determine which employees shall enjoy the right to organize for collective bargaining purposes when new bargaining units are created as part of the Government's planned reorganization of the public service over the next five years. At present, the PSSRA defines five broad occupational categories, within which the PSSRB has wide discretion to determine appropriate bargaining units. Generally, the Board has followed contemporary labour relations practices in other jurisdictions, fashioning bargaining units designed to reflect the "community of interest" of the various professional and occupational sectors. Thus, for example, the Economics, Sociology and Statistics (ES) Group, which ESSA represents, is one of 28 such groups within the scientific and professional category.
7. 106. However, the PSRA would eliminate the five broad occupational categories, giving the Treasury Board unfettered authority to reduce drastically the number of occupational groups within the public service. Those most immediately affected by the restructuring will be thousands of higher-level programme administrators and administrative officers who currently belong to bargaining units being merged into a very big, new General Services group. Once this is done, Treasury Board officials plan to combine more specialized occupational units. Plans are to merge the ES group, for example, with two others to form a new Social Sciences unit, which is likely to exclude a number of employees in the former occupational units who currently have bargaining rights. In addition to excluding the higher-level members of the ES group, the new definition may also affect many at the intermediate and even lower levels of the group, who may or may not be involved in "participation to a significant degree in the formulation of policies and programmes". Moreover, there is no provision in the Act that would allow those excluded thereunder to be included in a separate bargaining unit.
8. 107. ESSA points out that this is not the first time that the Government of Canada has moved to deprive professional and administrative employees of their collective bargaining rights. In 1978-79, a preceding government introduced two successive Bills, C-28 and C-22 to amend the PSSRA. Bill C-28 would have excluded from bargaining units federal employees exercising "senior professional" duties in relation to the "formulation or implementation" of policies, as well as to any employee earning $33,500 or more. Bill C-22 would have excluded any employee making "significant" policy recommendations. Although both Bills ultimately lapsed under parliamentary procedure without being put to a vote, ESSA lodged a complaint with the Committee on Freedom of Association in response to the 1978 legislation.
9. 108. In its report, the Committee concluded that since collective bargaining rights were recognized to public employees in Canada, it would be desirable for the Government to re-examine the Bill under consideration with a view to keeping the exclusions provided therein within the limits of those contemplated in Article 1, paragraph 2, of Convention No. 151, i.e. high-level employees whose functions are normally considered as policy-making or managerial, or to employees whose duties are of a highly confidential nature (194th Report (Canada), para. 58).
10. 109. ESSA submits that this counsel is fully applicable to the Government's current legislation where the language of the "managerial or confidential" exclusions is overly broad and far in excess of the above standard. It concludes by stating that the Government is committed to the passage of this legislation before the end of 1992.

B. The Government's reply

1. 110. In its communication of 25 January 1993, the Government of Canada denies the allegations set out in ESSA's complaint and submits that they are erroneous and misleading. The exclusion system rests on much more than what is alleged by ESSA which also omits to take into consideration that the bulk of the exclusions will remain unchanged despite the modifications contained in the Public Service Reform Act (PSRA).
2. 111. The Government explains in detail the general context in which the PSRA was enacted. In December 1989, Canada's Prime Minister announced a programme called "Public Service 2000", the main purpose of which was to enhance the efficiency and professionalism of the public service of Canada. For that purpose, task forces including one on staff relations were established to review the current system including its policies, directives and legislation. The members of the task force on staff relations consulted extensively within the public service and outside. All bargaining agents, including ESSA, were invited to appear before the said task force and file written submissions.
3. 112. The findings and recommendations of the task forces were widely disseminated throughout the public service and to the public service unions. In December 1990, the Government issued a White Paper on the renewal of the public service to present the results of this work and set out the Government's policy for the future of the public service of Canada. Task forces and White Paper recommendations have been incorporated into the PSRA which amends, inter alia, the Public Service Staff Relations Act (PSSRA). While under study before a legislative committee of the House of Commons, bargaining agents appeared before this Committee to present their views on the legislation which was the subject of three months of detailed discussion. Amendments to the legislation were brought forward in committee, some of which were accepted. The PSRA was tabled in June 1991 before the Canadian Parliament and received Royal Assent on 17 December 1992.
4. 113. The Government submits that it had two elements to take into consideration when it spelled out criteria for exclusions: (1) to identify an adequate management team to carry out the duties and responsibilities on behalf of the employer; (2) to identify, for the bargaining agents, the persons that are prohibited by law, due to the nature of their functions, to interfere with bargaining agents' activities.
5. 114. Under section 2 of the PSSRA, a person could be either excluded specifically under the definition of "employee", e.g. a member of the Royal Canadian Mounted Police, or by reason of his or her "managerial or confidential duties", e.g. a person who has executive duties and responsibilities in relation to the development and administration of government programmes. If the parties cannot agree on a proposed exclusion, the matter is brought to the PSSRB for determination. The PSSRB's decisions are reviewable by the courts, including Canada's highest tribunal, the Supreme Court of Canada.
6. 115. The Government maintains that the current exclusion process will be continued, albeit with some definitional changes introduced by the PSRA. It argues that it is significant that more than 90 per cent of exclusions occurred by agreement between the parties, without resorting to third party determination. This figure confirms the Government-employer's genuine concern to propose for exclusion only those persons that really perform duties of a managerial or confidential nature as described in the statute. For instance, only 2.5 per cent of the ES group are presently excluded from collective bargaining. Furthermore, out of this 2.5 per cent, approximately 80 per cent have been implemented by agreement of the parties.
7. 116. The Government further argues that all excluded persons whose classification corresponds to that of employees included in a bargaining unit, receive and will continue to receive, notwithstanding the amendments made under the PSRA, identical rates of pay and benefits as non-excluded employees. These rates of pay and benefits, therefore, are determined for all practical purposes through the collective bargaining process. The Government adds that even if excluded employees are not entitled to bargain collectively under the PSSRA, they nevertheless enjoy the protection and remedies provided by that Act. For instance, they can grieve the employer's decisions on virtually all terms and conditions of their employment and, for matters such as disciplinary measures including discharge, they can refer the employer's decision to the PSSRB and eventually to the Supreme Court of Canada.
8. 117. The Government then addresses specifically ESSA's allegations that some provisions of the PSRA would substantially expand the management exclusion clauses. The Government submits that the allegation whereby section 32(4)(b) of the PSRA excludes the positions "classified by the employer as being in the executive group, by whatever name called", is totally misleading. In its assertion, ESSA implies that members of the executive group were previously represented by a bargaining agent and that because of the definition found under section 32(4)(b) of the PSRA, these employees will no longer be represented by a bargaining agent. The reality is that the employees that fall within the definition of "executive group" are those at the pinnacle of their departmental organizations - assistant deputy ministers, director-generals and directors. These employees, for the last 25 years, have never been represented by a bargaining agent since the nature of their functions and duties would clearly put them in a conflict of interest if they were to be unionized. Therefore, there will be no increase in the number of exclusions as a result of the language now found in section 32(4)(b) of the PSRA.
9. 118. The Government then argues that ESSA's allegation that the exclusion "of an employee of the Treasury Board" by section 32(4)(d) of the PSRA will substantially expand the management exclusion clauses of the PSSRA, is erroneous because it implies that by virtue of section 32(4)(d), Treasury Board employees will now be excluded from collective bargaining for the first time. As a matter of fact, the overwhelming majority of Treasury Board employees have, for the last 25 years, been excluded from collective bargaining, and today, three-quarters of Treasury Board employees are excluded. The Government asserts that this exclusion is reasonable given that the vast majority of employees employed in the Treasury Board secretariat become involved in the course of their regular duties with matters directly related to the Treasury Board's responsibilities as employer.
10. 119. As regards ESSA's contention that the definition of a managerial or confidential position as, inter alia, a position "involving participation to a significant degree in the formulation and determination of any policy of the Government of Canada" leaves undue discretionary authority to the employer and the PSSRB, the Government submits that this argument is no longer valid. As the PSRA was amended during its progress through the different legislative stages in Parliament, the final text of subsection 5.1(1)(a) defines as managerial or confidential "a position the occupant of which has substantial duties and responsibilities in the formulation and determination of any policy or programme of the Government of Canada". The Government contends that the incumbents of the management positions contemplated here are undisputedly members of the management team in their respective departments. Their exclusion ensures that bargaining agents are protected from interference by management representatives. The Government refutes any allegation that the employer will enjoy any discretion or be able to make unilateral exclusions since first of all, the incorporation of the words "substantial duties" imposes, by definition, limitations on the number of positions that might be excluded pursuant to this provision. Moreover, section 5.2 of the PSRA allows a bargaining agent to challenge the employer's identification that a given position is of a managerial or confidential nature. The issue is then determined by the independent labour tribunal, the PSSRB, which will ultimately rule on any exclusion put forward.
11. 120. The Government also contests ESSA's allegation that under the PSRA, the employer will be able to "drastically reduce the number of occupational groups". It explains that the determination of the occupational group occurs in the course of the employer establishing its classification system. While the classification of positions has been recognized by law and the Canadian courts, since the establishment of collective bargaining, to be an employer's responsibility, the determination of the appropriate bargaining units and the question as to whether or not any employee or class of employees is included in a bargaining unit will continue, under the PSSRA as amended by the PSRA, to be left to the determination of the PSSRB once the classification reorganization exercise is completed. While the Government, as the employer, will continue to determine its classification plan that includes the occupational groups, the determination of the appropriate unit and the employees included in that unit will thus continue, upon the completion of the simplified classification system, to be made by the independent labour tribunal.
12. 121. The Government adds that its decision to restructure the classification plan and thus reduce the number of occupational groups was approved by the Public Service Alliance of Canada during the latter's submission on the PSRA to the Legislative Committee in March 1992. According to the Government, this move was also welcomed by ESSA during its presentation before the National Finance Committee of the Senate that dealt with the PSRA.
13. 122. The Government concludes by denying any violation of Conventions Nos. 87 and 151. It submits that the exclusions proposed by the Government of Canada in the PSRA meet the criteria set out in Article 1(2) of Convention No. 151 in that the exclusions can be justified on the grounds that the excluded public servants have special responsibilities or functions. Moreover, the Committee of Experts on the Application of Conventions and Recommendations has recognized the need, in certain circumstances, to restrict the participation of certain groups of employees to collective bargaining. In the Government's view, not only are the exclusions contemplated by the PSRA necessary because of their very own nature; they are also essential in order to identify the persons that are prohibited by sections 8, 9, 10 and 23 of the PSSRA, as well as Article 3(2) of Convention No. 87 and Article 5(2) of Convention No. 151, from interfering with bargaining agents' activities.

C. The Committee's conclusions

1. 123. The Committee notes that this case involves prohibitions on the right to organize and bargain collectively for certain categories of employees in the federal public service in Canada following the promulgation of the Public Service Reform Act (PSRA) on 17 December 1992 which amends, inter alia, the Public Service Staff Relations Act (PSSRA). The Government states that the majority of the excluded employees will remain unchanged despite the modifications contained in the PSRA and that in any case, these exclusions are essential in ensuring that bargaining agents are protected from interference by management representatives. It submits that it took into consideration two elements when it spelled out criteria for exclusions: (1) to identify an adequate management team to carry out the duties and responsibilities on behalf of the employer; (2) to identify, for the bargaining agents, the persons that are prohibited by law, due to the nature of their functions, to interfere with bargaining agents' activities. According to the Government, these exclusions meet the criteria set out in Article 1(2) of Convention No. 151.
2. 124. The complainant states that the PSRA was introduced without prior public hearings on the Government's general public service reform proposals whereas the Government asserts that the task force on staff relations (which was set up to review the public service system including its policies, directives and legislation) not only consulted extensively within the public service and outside but that all bargaining agents, including ESSA, were invited to appear before the said task force and file written submissions. In view of the contradiction between these two arguments, the Committee will only recall the final remarks made on this subject in the Report of the Study and Information Mission to Canada which took place in September 1985 within the context of this Committee's examination of complaints alleging infringements of trade union rights in a number of provinces in Canada: "Although the Canadian system of industrial relations operates legally regulated bargaining procedures the importance of consultation remains. This is particularly so where a government introduces proposed legislation to amend the rules governing that system and to change the relative position of the parties to the bargaining. It has already been remarked that such consultation is doubly important where the Government seeks to alter bargaining structures in which it acts actually or indirectly as employer." (241st Report, para. 224.) The Committee therefore stresses the importance of consultation prior to the introduction of legislation through which the Government seeks to alter bargaining structures in which it acts actually or indirectly as employer.
3. 125. As regards the rights of association of public employees under Convention No. 87, the Committee has acknowledged on previous occasions that the prohibition of the right of association for workers in the service of the State is incompatible with Article 2 of the Convention according to which workers, without distinction whatsoever, should have the right to establish organizations of their own choosing without previous authorization (Digest of decisions and principles of the Freedom of Association Committee, 3rd edition, 1985, para. 215). The Committee would also refer to what the Committee of Experts on the Application of Conventions and Recommendations has stated in this connection, namely, that prohibiting managerial staff and employees in positions of confidence in the public sector from joining trade unions representing other workers is not incompatible with freedom of association provided that: (1) these excluded employees have the right to form their own organizations to defend their interests; and (2) these excluded categories of employees are not so broadly defined that the organizations of other workers in the enterprise or branch of activity are weakened by depriving them of a substantial proportion of their membership (General Survey on Freedom of Association and Collective Bargaining, 1983, para. 131).
4. 126. As regards the right of excluded employees to form their own associations, the Committee notes that section 32(2) of the PSRA defines an "employee" as any person employed in the public service other than those enumerated in this provision which include "a person who occupies a managerial or confidential position" (section 32(2)(j)). The Committee further notes that an "employee organization" (the definition of which has not been amended by the PSRA) is described in section 2 of the PSSRA as "any organization of employees the purposes of which include the regulation of relations between the employer and its employees for the purposes of this Act ...".
5. 127. While taking into account the Government's arguments that these excluded employees have recourse to the grievance procedures established under the PSRA, the Committee feels bound to point out that the standards contained in Convention No. 87 apply to all workers "without distinction whatsoever" and are therefore applicable to these excluded employees who should be able to establish their own organizations to further and defend the interests of their members which, however, does not necessarily entail the right to strike. Noting that no such provision exists under current legislation, the Committee requests the Government to take the necessary action to ensure that these excluded employees enjoy the rights of association guaranteed under Convention No. 87.
6. 128. In determining whether these categories of excluded employees have been too broadly defined in the PSRA thereby leaving undue discretionary authority to the employer and the PSSRB, the Committee notes first of all that the final wording of new subsection 5.1(1)(a) of the PSRA defines as managerial or confidential "a position the occupant of which has substantial duties and responsibilities in the formulation and determination of any policy or program of the Government of Canada". The Committee considers that the language here sets out clear and precise criteria and by definition limits the number of employees who might be excluded pursuant to this provision.
7. 129. Likewise, the Committee does not consider that section 32(4)(b) of the PSRA which allows the employer to classify members of the executive group in a managerial or confidential position leaves undue discretionary authority to the employer since these persons are by definition high-level employees whose functions are normally considered as policy-making or managerial or whose duties are of a highly confidential nature. The nature of their functions and duties would appear to justify their exclusion from the PSRA for the purposes of collective bargaining.
8. 130. As regards the complainant's contention that following the Government's classification reorganization exercise, the employer will be able to reduce drastically the number of occupational groups within the public service, the Committee observes that the number of occupational groups will indeed be reduced since, by the Government's own admission, the whole purpose of the restructuring exercise is to simplify the classification system which includes these groups. The Committee notes, however, that under the terms of section 41(2) of the PSRA an independent labour tribunal (the PSSRB) will determine whether a group of employees constitutes a unit appropriate for collective bargaining, having regard to the plan of classification including occupational groups and subgroups, and that "if any question arises as to whether any employee or class of employees is or is not included therein or is included in any other unit, the Board will, on application by the employer or any employee organization affected, determine the question" (section 36 PSSRA). Even if a number of higher-level or middle-level employees who previously belonged to bargaining units are transferred to a new occupational group by virtue of the new classification system, the Committee does not feel that this will enable the Government to use the management exclusion clauses to determine whether those employees shall enjoy the right to organize for collective bargaining purposes, since under the terms of the legislation, it is the PSSRB which will determine this question on the basis of the amended management exclusion clauses.
9. 131. Turning to the complainant's allegation that subsection 32(4)(d) of the PSRA substantially expands the management exclusion clauses of the PSSRA by defining the position of "an employee of the Treasury Board" as a managerial or confidential position, the Committee notes that this exclusion clause does indeed encompass all employees of the Treasury Board whereas they were not mentioned at all in the PSSRA. The Committee observes that the Treasury Board is the department representing the Government as employer vis-à-vis all government employees. It further observes from the Government's arguments that the vast majority of employees of the Treasury Board secretariat become involved in the course of their regular duties with matters directly related to the Treasury Board's responsibilities as "employer". Nevertheless, the Committee cannot agree that such a blanket exclusion as introduced by subsection 32(4)(d) of the PSRA, without any regard to the nature or level of functions, is compatible with the principles of freedom of association. The Committee considers, as it did previously in a similar case involving the same complainant and Government (194th Report (Canada), paras. 57 and 58), that the exclusion of employees of the Treasury Board from the PSRA should be limited to high-level employees whose functions are normally considered as policy-making or managerial, or to employees whose duties are of a highly confidential nature.