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Divisional Court Overrules Labour Board on Legality of Non-Construction Employer Provisions

Practice Areas: Labour Relations

On February 18, 2011 the Divisional Court in Ontario unanimously overturned a prior ruling by the Ontario Labour Relations Board ("OLRB") that the "non-construction employer" provisions in the Ontario Labour Relations Act, 1995 ("OLRA") were unconstitutional.

The non-construction employer provisions permit companies who do not engage in construction activities for profit to make application to the OLRB to terminate previously established bargaining rights of unions in the construction industry.

The construction unions involved in this case had argued that the non-construction employer provisions of the OLRA were unconstitutional because they stripped employees of their right to freedom of association. The Divisional Court disagreed.

This decision paves the way for employers who are bound to collective agreements with construction unions, but who do not engage in, or engage others to perform, construction work with the expectation of compensation from unrelated third parties, to bring future non-construction employer applications to the OLRB . Some examples of potential non-construction employers include retailers, school boards, municipalities and manufacturers who are bound to collective agreements covering work in the construction industry.

The case cite is Independent Electricity System Operator v. Canadian Union of Skilled Workers and Labourers' International Union of North America et. al. (2011) ONSC 81.

Please Note: This blog has been prepared as an informational service for our clients and other interested parties. It is not intended to constitute legal advice, a complete statement of the law or opinion on any subject. Although we endeavour to ensure the accuracy of the content, no one should act upon the information provided without a thorough examination of the law after the facts of a specific situation are fully considered.


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