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Union Fines are Not Legally Enforceable – Part IV

Posted On: January, 23 2015

Union Trials as Arbitrations

An argument that has been advanced by unions seeking the civil enforcement of their fines is that the trial procedure set out in various union constitutions is essentially an arbitration agreement. This argument proposes that when an individual joins a union, that individual agrees that certain disputes that may arise between the individual and the union will be subject to a trial according to the union’s procedures set out in the union constitution. According to the argument advanced by unions, by agreeing to be bound by these procedures for determining liability, the member also agrees to be bound by the outcome.

The advantage for the unions in labelling their internal proceedings “arbitrations” is that s. 50(3) of the Arbitration Act makes it mandatory that the court assist in enforcing an arbitration award.

However, this argument was rejected by the Court of Appeal for Ontario in the case Universal Workers Union (Labourers’ International Union of North America, Local 183) v. Ferreira, 2009 ONCA 155 (CanLII).

For there to be an arbitration two criteria have to be met. There has to be a dispute between the parties, and there has to be a clear agreement to submit that dispute to an arbitrator and be bound by the outcome.

The Court of Appeal found that internal union discipline is a not a dispute over an agreement between the union and the individual member. The Court said, “Participation in a discipline process by filing or answering a complaint is not as a function of an agreement between the parties; it is solely a discipline or offence finding exercise.” This draws an important distinction between disciplinary proceedings and civil disputes between parties. Only civil disputes between parties, such as disagreements over property rights or contractual rights, can be submitted to arbitration. A prosecution for a criminal offence, or a regulatory offence, cannot be the subject of arbitration. The Court of Appeal has essentially ruled that union prosecutions for breaches of the constitution are more akin to criminal prosecutions, than they are to civil disputes. For this reason, the arbitration argument failed.

The arbitration argument also failed on the second required characteristic of arbitrations. In Universal Workers, the Court of Appeal also found that there was no agreement on the part of the individual union members to be bound to arbitration in the event of a dispute with the union, for five reasons:

  1. First, there is no express arbitration agreement in the constitution (the remaining reasons deal with whether there is an implied agreement for arbitration).
  2. Second, the Court interprets the constitution from the standpoint of it being an adhesion contract: “Those who join the union have no bargaining power to affect the terms of membership and, in many situations, membership is a prerequisite to employment, leaving the individual with little choice but to accept the constitution and its terms.”
  3. Third, the Court went on to characterize the provisions dealing with charging and punishments as being “penal” in nature – these sections are not properly characterized as dealing with civil disputes between parties to a contract.
  4. Fourth, the decision-makers are not independent. The decision-maker under this constitution was appointed and paid by the union executive, and therefore was lacking important hallmarks of neutrality and independence. In many cases the decision-makers are actually members of the union executive, clearly lacking independence.
  5. Finally, the Court observed that this constitution, like many others, contains a provision prohibiting recourse to the courts. This suggests that its penal provisions were meant to be internal in nature.

Absent a radical modification to the labour relations regime in Ontario, such as the implementation of the “open shop” concept, and/or substantial changes to many union constitutions, it appears that union fines will only be collectable on a voluntary basis for the foreseeable future.

If you have been charged by your union or have been the subject of a union prosecution or fine, seek legal counsel to learn about your rights and explore your options.

 

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