Supreme Court Of Canada Ruling: Managers Are Not Eligible For Unionization Under The Labour Code – Employee Rights/ Labour Relations

On April 19, 2024, the Supreme Court of Canada rendered its
decision in Société des casinos du Québec
inc. v. Association des cadres de la Société
des casinos du Québec, marking the end of an almost 15
year-long debate on the freedom of association of managers and
their exclusion under the Labour Code.

The facts

The Association des cadres de la Société des
casinos du Québec (the “Association”) represents
first-level managers at the province’s four casinos operated by
the Société des casinos du Québec (the
“Société”). The Association is a
professional syndicate within the meaning of the Professional
Syndicates Act. Although the Association is not governed by
Quebec’s Labour Code (the “Code”), given the
exclusion of managers from the notion of “employee”
provided for in theCode, this exclusion does not prevent members of
the Association from associating. In fact, in 2001, the Association
and the Société signed a memorandum of understanding
governing certain aspects of the collective labour relations.

However, faced with the inability of the Association’s
members to access the remedies offered by the Code, such as
protections against bad-faith bargaining, the right to strike and
the specialized dispute resolution mechanism, in 2003 the
Association lodged a complaint with the International Labour
Organization’s Committee on Freedom of Association.

Dissatisfied, the Association then filed a petition for
certification under the Code in 2009, requesting that the exclusion
of management staff from the definition of “employee,”
and therefore from the unionization process under the Code, be
declared unconstitutional, as it infringed on the freedom of
association protected by the Charters. The
Société raised an exception to dismiss, since
managers are excluded from the application of the Code.

Proceedings prior to the Supreme Court of Canada

In its 2016 decision, the Administrative Labour Tribunal (the
“ALT”) found that the exclusion of managers from the
definition of “employee” violates the freedom of
association of the first-level managers represented by the
Association, and that this infringement is not justified in a free
and democratic society. The exclusion was declared inoperative in
the context of this application.

According to the ALT, the Association does not benefit from a
meaningful process for bargaining in good faith for its
members’ working conditions. Furthermore, the Association
members’ right to strike is infringed without any other
mechanism being provided, which, according to the ALT, constitutes
a substantial infringement of the right to collective
bargaining.

In 2018, the Superior Court of Québec allowed the
Société’s application for judicial review. The
Superior Court concluded that the exclusion of managers from the
Code does not contravene the freedom of association. Employers must
be able to trust their managers and, for the sake of employee
unionization, there can be no ambiguity about managers’
allegiance¹. Managers can organize and associate, but
not under this law.

In 2022, the Court of Appeal overturned the Superior Court’s
ruling and reinstated the ALT’s decision. According to the
Court of Appeal, the ALT was right to conclude that the effects of
the exclusion from the Labour Code regime constitute
substantial interference with the exercise of the freedom of
association.

The Supreme Court of Canada’s decision

In a new development on April 19, the Supreme Court of Canada
allowed the Société’s appeal, essentially ruling
that the exclusion of managers from the Code does not violate the
freedom of association. Although the seven (7) judges hearing this
case concluded that the Dunmore analytical frameworkis the
relevant one, there are applicable concurring reasons. In the
opinion of the majority of the Court, a two-part test must be
applied:

1. The Court must consider whether the activities in question fall
   within the scope of freedom of association; and




2. The Court must consider whether the statutory exclusion
   substantially interferes with those activities, in purpose or
   effect.

In this case, the Association alleged that by excluding managers
from the application of the Code, the government was preventing its
members from “engaging in a process of meaningful collective
bargaining with their employer, with constitutional protection for
the Association, sufficient independence from the employer, and the
right to recourses if the employer does not negotiate in good
faith.”² According to the Supreme Court, the
Association’s claim was indeed based on an activity that is
protected under the freedom of association, thus passing the first
part of the test.

However, the Association’s claim fails the second part of
the test. The Supreme Court concluded that the exclusion of
managers from the Code’s definition of an employee does not
substantially hinder the Association’s activities. As the
Superior Court had found, this exclusion is intended to distinguish
managers from employees and avoid conflicts of interest, in
particular by ensuring that the employer can trust its managers and
that employees can protect their own interests.

The memorandum of understanding between the
Société and the Association demonstrates that the
members are able to associate and negotiate with the employer.
Moreover, this protocol enables the Association to take legal
action before the ordinary courts of law in the event of
non-compliance with its terms and conditions. According to the
Supreme Court, “the right to meaningful collective bargaining
does not guarantee access to a particular model of labour
relations.”³

Conclusion

After several years of debate, the Supreme Court of Canada has
finally settled the question of the constitutionality of the
exclusion of managers from Quebec’s collective labour relations
regime set out in the Labour Code. As this exclusion does
not violate managers’ freedom of association, they will not be
able to validly file petitions for certification under the Code.
However, they will be able to exercise their freedom of association
in other ways, as in this case, through the Professional
Syndicates Act, as well as before the ordinary courts of law.
This decision is a positive one for Quebec employers, as it
protects the structure of workplaces and the allegiance of managers
within organizations.

Footnotes

1. 2018 QCSC 4781, para. 116 et seq.

2. 2024 SCC 13, para. 47.

3. 2024 SCC 13, para. 55.

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