Court of Queen=s Bench of Alberta

Transcription

1 Court of Queen=s Bench of Alberta Citation: Alberta Union of Provincial Employees v Alberta, 2014 ABQB 97 Date: Docket: Registry: Edmonton Between: Alberta Union of Provincial Employees Guy Smith and Mike Dempsey - and - Applicants Her Majesty the Queen in Right of the Province of Alberta Respondent - and - The Minister of Justice and Solicitor General of Alberta Intervener Case Management Decision #1 of the Honourable Mr. Justice D.R.G. Thomas

2 Page: 2 Table of Contents I. Introduction... 3 II. Background Facts... 4 III. Evidence... 4 A. Professor John Fryer... 5 B. Dale Perry... 6 C. John DeCesare... 7 IV. The Law... 7 A. Charter, s 2(d)... 7 B. The Legal Test for an Injunction... 8 V. Analysis... 9 A. Serious Issue Applicants Alberta/Minister Serious Issue Analysis Conclusion Serious Issue B. Irreparable Harm Applicants Alberta Irreparable Harm Analysis Conclusion Irreparable Harm C. Balance of Convenience Applicants Alberta Analysis Conclusion VI. Summary of Relief Granted Schedule A... 23

3 Page: 3 I. Introduction [1] This is case management decision #1 on an injunction motion by the Applicants. The Alberta Public Service Salary Restraint Act, SA 2013, c P-43 [ PSSRA ], attached as Schedule A, came into effect on December 11, This short piece of legislation directly affects the employment contract interaction and collective bargaining process between the Government of Alberta [ Alberta ] and its largest group of direct employees, who are represented by the Alberta Union of Provincial Employees [ AUPE ]. AUPE is authorized and organized by the Public Service Employee Relations Act, RSA 2000, c P-43 [ PSERA ] and altogether represents 85,000 +/- employees under approximately 100 collective agreements in the Province of Alberta. AUPE is the exclusive bargaining agent for the 24,000 employees of the Crown in right of Alberta to whom the PSERA applies [the Crown bargaining unit ]. Guy Smith is the President of AUPE and Mike Dempsey is employed by the Alberta Ministry of Environment, a member of the Crown bargaining unit and therefore a member of AUPE. [2] PSSRA provides that if no collective agreement is entered into by Alberta and AUPE by January 31, 2014, since extended to March 31, 2014 by O.C. 24/2014 [the O.C. ], then the May 17, 2011 collective agreement between Alberta and AUPE [the 2011 Collective Agreement ] will be deemed in effect for the period April 1, 2013 to March 31, The PSSRA also dictates that from April 2013 to March 2015 pay for all employees in the Crown bargaining unit will remain unchanged, with 1% increases in pay in each of April 2015 to March 2016, and April 2016 to March [3] The PSSRA also: 1. provides employees a small lump sum payment on April 1, 2014 (s 3); 2. terminates any Compulsory Arbitration Board [ CAB ] arbitration between AUPE and Alberta authorized by PSERA, Part 6, Division 2 (s 4(2)); 3. trumps the operation of the PSERA (s 5); and 4. authorizes the making of regulations on a number of subjects (s 7). [4] On January 10, 2014 the Applicants sought a stay of the operation of the PSSRA, s 4 on the basis this legislation breaches the Canadian Charter of Rights and Freedoms, Part 1, Constitution Act, 1982, being Schedule B to the Canada Act 1982 (U.K.), 1982, c 11 [the Charter ], s 2(d). In effect, the Applicants seek that this Court delay operation of the PSSRA so that the consideration of the AUPE/Alberta dispute by the CAB process will continue. [5] Alberta opposes the stay application and The Minister of Justice and Solicitor General of Alberta [the Minister ] intervenes on the basis that a constitutional issue has been raised by the Applicants. [6] At the January 28, 2014 case management hearing, I proposed that an interim without prejudice injunction be granted in light of the important subject matter under consideration, the detailed arguments and analyses provided by the parties, and the very short time between that hearing and the date on which the PSSRA would take effect (at that time January 31, 2014). This interim period was to provide additional time to provide full and detailed reasons for my decision to either grant or refuse the application for an injunction. Neither party challenged my proposal, and accepted that the injunction sought by the Applicants would be in force until this decision was issued on or before noon on February 14, 2014.

4 Page: 4 II. Background Facts [7] The factual background to this matter is not in dispute. As noted in the Introduction, AUPE represents approximately 24,000 persons directly employed by Alberta in the Crown bargaining unit. The 2011 Collective Agreement between Alberta and AUPE expired on March 31, [8] AUPE initiated a collective bargaining process for the post-march 31, 2013 period in January of that year. Actual bargaining commenced on March 12, 2013 and continued intermittently into May, During this period AUPE and Alberta came to an agreement on a number of non-monetary items but other issues including the core question of pay remained unresolved. [9] The parties moved to mediation, which occurred during July of AUPE narrowed the outstanding questions to six key issues and presented them to Alberta. The Mediator reported that Alberta refused to discuss AUPE proposals and mediation terminated on July 6, [10] On July 15, 2013, AUPE initiated a CAB procedure. The three members of the CAB were determined in September and October, 2013, and hearing dates were set for early February, Those dates have now been lost. [11] On November 27, 2103 Alberta introduced the proposed PSSRA [ Bill 46 ] in the Alberta Legislative Assembly [the Assembly ]. The previous day the Assembly had passed motions to limit debate and accelerate the process by which Bill 46 would advance to passage. There had been no public disclosure or discussion of the policies reflected in Bill 46 prior to November 27, The Applicants were completely unaware of Bill 46 or its contents prior to its introduction, nor had Alberta consulted with AUPE or any of its members on its intention to legislate in this fashion. [12] Debate at the second and third reading of Bill 46 was abbreviated when closure was invoked and Bill 46 was passed on December 4, The legislation received Royal Assent on December 11, 2013 and the PSSRA came into effect that day. [13] On December 12, 2013 AUPE filed a Statement of Claim [the Action ] challenging the constitutional validity of the PSSRA. The Applicants Guy Smith and Mike Dempsey were added to the Action through an Amended Statement of Claim, filed January 8, Alberta had filed a Statement of Defence on January 6, 2014 and the Applicants filed this Application on January 10, [14] Further collective bargaining occurred between AUPE and Alberta on January 14-16, 2014, but no new agreement has been reached. The new deadline for implementation of all provisions of the PSSRA has been extended by the O.C. to March 31, III. Evidence [15] AUPE filed evidence in the form of two affidavits, one from Dale Martin Perry [ Perry ], sworn January 10, 2014 [the Perry Affidavit ] and the second from Professor John Fryer [ Professor Fryer ] made January 13, 2014 [the Fryer Affidavit ].

5 Page: 5 A. Professor John Fryer [16] Professor Fryer is an adjunct professor at the University of Victoria, and a consultant on labour topics including collective bargaining. He had formerly acted in an official capacity both in union and employer settings, and has been directly involved in a broad range of labour negotiations over decades in Canada. AUPE presented Professor Fryer as an expert in labour relations. Alberta and the Minister accepted that Professor Fryer was qualified as an expert in that field and I indicated that I would accept him as an expert, subject to performing an analysis pursuant to R v Mohan, [1994] 2 SCR 9, 114 DLR (4th) 419 [ Mohan ] to determine the admissibility of his opinions. [17] Mohan is a unanimous decision of the Supreme Court of Canada dealing with the requirements which must be met for the admission of expert evidence. To briefly restate those requirements as articulated by Sopinka J in Mohan, the evidence tendered must be: (a) (b) (c) (d) (e) logically and legally relevant; reliable; not subject to an exclusionary rule; necessary to assist the decision maker in resolving issues; and qualified in the sense the proposed expert must have acquired special or peculiar knowledge through study or experience, in respect to the matters on which the witness proposes to testify. [18] I have reviewed the Fryer Affidavit attached to the curriculum vitae of Professor Fryer. As noted, Alberta and the Minister accept Professor Fryer is qualified to give opinion evidence as an expert in the areas of public sector collective bargaining and labour relations. Having reviewed his credentials, which include extensive experience in labour relations in Canada at many levels, academic experience as both a teacher and a contributing author to the literature in this field, and hands on experience in labour relations, I find that he is qualified as an expert in the areas of public sector collective bargaining and labour relations, and capable of giving opinion evidence on the subject of collective bargaining in the public sector, in particular, and the effect of legislation such as the PSSRA on collective bargaining processes, on members of bargaining units, including individual members of a union. [19] The evidence found in the Fryer Affidavit and particularly the opinions at para 11 thereof meet all of the other requirements in Mohan in terms of logical and legal relevance to the issues before this Court. I regard his evidence as reliable and the evidence is necessary, because it deals with subjects outside of my skill and knowledge. Finally, there is no exclusionary rule applicable to this evidence. I conclude that all of the requirements of Mohan are met in respect to the opinion evidence presented through the Fryer Affidavit. [20] Professor Fryer was cross-examined by counsel for Alberta, presumably in an attempt to diminish the weight which might be assigned by the Court to his opinion evidence. However, the effect of the cross-examination was generally to reinforce the strength of the opinions offered by Professor Fryer. I note the fair concessions made and candid answers given by Professor Fryer, which indicate to me that he is an independent expert, notwithstanding that he was tendered by the Applicants. Given the extensive experience of Professor Fryer in labour relations, I consider

6 Page: 6 his evidence to be reliable. I give great weight to this body of evidence which was not contradicted by any witness for Alberta or the Minister. [21] The evidence in the Fryer Affidavit focuses on the effect of unilateral action by a level of government which interferes with or negates collective bargaining processes. In his opinion this kind of action has a range of negative effects, because as he states in para 11, the government imposition of contract terms: 1. communicates that bargaining efforts are irrelevant; 2. discourages creative bargaining attempts as these are a waste of time and effort when government intervention is a possibility; 3. undermines the role of unions and union representation to speak for union members; 4. undermines the confidence union members have in their leadership during contract negotiations but also in other processes where unions assist in employee/employer interactions, such as grievance arbitrations; and 5. causes workers to feel powerless, and engage in alternative and potentially inappropriate steps to push back against employer control. [22] Professor Fryer stressed that government intervention has potentially long-lasting effects on the union/employer relationship, and that while interest arbitration is an effective alternative to conventional collective bargaining and labour actions such as strikes and lockouts, interest arbitration through entities such as the CAB is most effective when conducted in a prompt and timely manner. [23] In cross-examination Professor Fryer confirmed to Alberta s counsel that in the Canadian labour context the PSSRA is a very unusual, if not unique, form of union/government employment legislation. While intervention by legislation to set or restrict salaries is a known approach, the unilateral imposition of an entire collective agreement is novel, particularly where no attempt is made to negotiate and reach agreement on other non-financial aspects of the relationship. [24] In summary, I accept all of the opinions offered by Professor Fryer and give them great weight in coming to my conclusions on whether the Applicants have met their burden to show all elements of this injunction application have been met. B. Dale Perry [25] Perry is a negotiator for AUPE and his personal and documentary evidence has provided the basis for the background facts recited above. [26] Perry deposes in the Perry Affidavit that the PSSRA has undermined the confidence of the membership of AUPE in the union s utility and capacity to represent its members and engage in meaningful negotiations with the employer. He believes that Alberta has little or no incentive to engage in negotiation or compromise with AUPE on outstanding issues. Perry also indicates that termination of the CAB process will make it virtually impossible for a future but delayed CAB procedure to reach an appropriate settlement of outstanding points of disagreement. [27] It is Perry s view that this represents irreparable harm to the capacity of AUPE to bargain and to the existing and ongoing relationship between AUPE and its members and Alberta. In the

7 Page: 7 cross-examination on his affidavit Perry indicated that the PSSRA approach was unprecedented and raised the prospect of further legislated collective agreements in the future. C. John DeCesare [28] John DeCesare ( DeCesare ) is an articling student at McLennan Ross, the law firm representing Alberta. He visited a number of websites, including the AUPE website and attaches copies of screen shots to his Affidavit. Otherwise, the Respondent offered no evidence to refute the evidence of Professor Fryer and Perry. IV. The Law A. Charter, s 2(d) [29] Section 2 of the Charter enumerates four protected fundamental freedoms and s 2(d) protects the freedom of association. [30] In a series of decisions the Supreme Court of Canada has considered the application of the Charter, s 2(d) in relation to the rights of workers to engage in collective interaction with government employers. The modern approach was set in Health Services and Support - Facilities Subsector Bargaining Assn v British Columbia, 2007 SCC 27, [2007] 2 SCR 391 [ Health Services ], and more recently confirmed in Ontario (Attorney General) v Fraser, 2011 SCC 20, [2011] 2 SCR 3 [ Fraser ]. In the latter the majority judgment of Chief Justice McLachlin and Justice Lebel provide a very helpful review and restatement of the collective rights of workers that flow from the Charter, s 2(d): [37]... s. 2(d) includes a process of collective action to achieve workplace goals (para. 19). This process requires the parties to meet and bargain in good faith on issues of fundamental importance in the workplace... [38]... Section 2(d), interpreted purposively and in light of Canada s values and commitments, protects associational collective activity in furtherance of workplace goals. The right is not merely a paper right, but a right to a process that permits meaningful pursuit of those goals. The claimants had a right to pursue workplace goals and collective bargaining activities related to those goals.... [40] The majority of the Court in Health Services affirmed that bargaining activities protected by s. 2(d) in the labour relations context include good faith bargaining on important workplace issues (para. 94; see also paras. 93, 130 and 135). This is not limited to a mere right to make representations to one s employer, but requires the employer to engage in a process of consideration and discussion to have them considered by the employer. In this sense, collective bargaining is protected by s. 2(d). The majority stated: Thus the employees right to collective bargaining imposes corresponding duties on the employer. It requires both employer and employees to meet and to bargain in good faith, in the pursuit of a common goal of peaceful and productive accommodation. [para. 90]

8 Page: 8... [42] The Court in Health Services emphasized that s. 2(d) does not require a particular model of bargaining, nor a particular outcome. What s. 2(d) guarantees in the labour relations context is a meaningful process. A process which permits an employer not even to consider employee representations is not a meaningful process.... [43]... It is difficult to imagine a meaningful collective process in pursuit of workplace aims that does not involve the employer at least considering, in good faith, employee representations. The protection for collective bargaining in the sense affirmed in Health Services is quite simply a necessary condition of meaningful association in the workplace context. [Emphasis added.] [31] The majority at para 41 explained a good faith negotiated process is one which permits meaningful dialogue between the workers and the employer, but does not demand a particular form of bargaining or labour relations, but rather a contextually appropriate process. [32] As can be seen from the foregoing Charter, s 2(d) limits the authority of a government actor to unilaterally impose a contractual structure on workers which it employs. That said, this requirement to permit meaningful group dialogue and bargaining is subject to the Charter, s 1 limits on that right that may be demonstrably justified in a free and democratic society. B. The Legal Test for an Injunction [33] There is no substantial dispute on the three-part legal test for the granting of an interim injunction, which is provided for in RJR - MacDonald Inc. v Canada (Attorney General), [1994] 1 SCR 311, 111 DLR (4th) 385 [ RJR MacDonald ] and more recently restated by the Court of Appeal in Communications, Energy and Paperworkers Union, Local 707 v Suncor Energy Inc., 2012 ABQB 627 at para 25, 548 AR 195, affirmed 2012 ABCA 373, 539 AR 206: In order to succeed in an application for an interim injunction, the Union must establish the following: 1. There is a serious issue to be tried; 2. Irreparable harm will result if an interim injunction is not granted and the Union is ultimately successful...; 3. The balance of convenience favours granting the injunction. [34] Both parties cite the text Injunctions and Specific Performance (Aurora: Canada Law Book, 2013) written by Ontario Court of Appeal Justice Robert J. Sharpe as an authoritative source on this subject. [35] In RJR MacDonald, supra, the first step, the serious issue or question requirement, is described as a limited and preliminary review of the merits of the matter. Whether the test has been satisfied should be determined by a motions judge on the basis of common sense and an extremely limited review of the case on the merits.... A motions court should only go beyond a preliminary investigation of the merits when the result of the interlocutory motion will in effect amount to a

9 Page: 9 final determination of the action, or when the constitutionality of a challenged statute can be determined as a pure question of law. Instances of this sort will be exceedingly rare. Unless the case on the merits is frivolous or vexatious, or the constitutionality of the statute is a pure question of law, a judge on a motion for relief must, as a general rule, consider the second and third stages... [36] Thus, there are two different potential thresholds in the serious issue analysis: 1. Where an injunction does not operationally provide a final result for the litigation then an injunction may potentially be ordered unless the applicant s case is frivolous or vexatious, or 2. Where an injunction would effectively decide a matter in favour of a litigant then a more substantial and exhaustive review of the strength of a case is required. [37] The latter and higher threshold is described in Sharpe s text as requiring the applicant to demonstrate a strong prima facie case. In RJR - MacDonald this alternative procedure is identified as an immediate decision of the case on its merits. [38] Irreparable harm reflects the nature of the harm rather than its magnitude. A meaningful risk is a basis for an injunction, provided the threat is imminent and real : Lubicon Lake Band v Norcen Energy Resources Ltd., 1985 ABCA 12, 58 AR 161, leave denied [1985] SCCA No 190 [ Lubicon Lake ]. Irreparable harm may include quantifiable financial loss. [39] The third criterion is a balancing exercise where the harm that flows to the applicant is balanced against the consequences to the respondent. This exercise also considers the relative strengths of the two positions. This balance of inconveniences (RJR - MacDonald) may consider public interest, provided a party who relies on public interest demonstrates that the legislation provides a public benefit. The preservation of the status quo is a potentially relevant factor: Edmonton Northlands v Edmonton Oilers Hockey Corp., 1994 ABCA 40 at para 29, 149 AR 92 [ Northlands ]. V. Analysis [40] The parties disagree on whether any of the criteria have been met. A. Serious Issue 1. Applicants [41] The Applicants argues that an injunction at this stage does not effectively conclude the matter in their favour, but instead that court intervention would only allow an ongoing resolution process to continue. The appropriate threshold to consider an injunction is therefore whether the claim of the Applicants is frivolous or vexatious. [42] The Applicants stress that the threshold for protected Charter, s 2(d) group worker rights identified in Health Services, supra, and Fraser, supra, particularly in para 35 of the latter decision:... The government wanted to reduce costs by changing the structure of its employees' working arrangements in ways that would have been impermissible under the existing collective agreements. It chose to do so, not through collective bargaining to the end of altering those collective agreements, but by the simple

10 Page: 10 expedient of legislation. In short, the government used its legislative powers to effectively nullify the collective agreements to its benefit, and to the detriment of its employees. The legislation not only conflicted with existing collective agreements, but also precluded collective bargaining in the future on a number of issues and conditions of employment.... [43] The Applicants argue that the PSSRA is similar in the way it impedes the good faith bargaining obligation between employer and employee. The operation of the PSSRA effectively creates a monologue where Alberta unilaterally dictates the employment terms of the members of AUPE. Salaries are set without negotiation. AUPE and Alberta had previously negotiated changes to the previous collective agreement and those changes are erased by Alberta now unilaterally continuing the 2011 Collective Agreement through PSSRA. The Applicants say that no further good faith bargaining or dialogue is possible given Alberta s unilateral action to impose a collective agreement and terminate the PSERA Division 2, Part 6 mediation mechanism. 2. Alberta/Minister [44] Alberta in its written brief argues that an injunction would, in practice, resolve the litigation in favour of the Applicants. Alberta therefore takes the position that the strength of the Applicants alleged Charter, s 2(d) breach is an important factor, and that the strong prima facie case threshold should apply. The consequences of an injunction are described in this manner:... Once the CAB is allowed to proceed, the ramifications cannot be undone after the legislation is successfully defended on the merits.... even though the union has agreed to stay any monetary increases that may be awarded by the CAB, the CAB award would undoubtedly be used to influence the outcome of upcoming bargaining and interest arbitrations affecting the broader public service (outside the bargaining unit). These collateral impacts cannot be repaired once the legislation is successfully defended. Indeed, the CAB award would continue to be relied upon as a precedent even after the legislation has been defended. Moreover, there are some significant non-monetary items in dispute that would take immediate effect in respect to this bargaining unit. These items cannot be retroactively undone after the legislation is defended. The union only agreed to stay monetary terms of the CAB award. [45] Alberta takes the position the approach and conclusion by the Supreme Court of Canada in Fraser means that there is no prospect for the Applicants to ever succeed and thus there is no serious issue to be tried here. When pressed in argument, Alberta s counsel acknowledged that the claim is not frivolous or vexatious but nevertheless continued to advocate that it is a very weak Charter argument which could not withstand a summary dismissal motion. Alberta stresses that the Charter, s 2(d) is only infringed when it is either: a) impossible for workers to make collective representations to an employer, or b) that employer does not consider those collective representations in good faith. [46] Alberta argues further in its written brief that there is nothing to prevent further negotiations between AUPE and Alberta:

11 Page: In these circumstances, how can it be alleged that the legislation has made it impossible for employees in the public service to meaningfully exercise their right to associate? They have enjoyed and continue to enjoy ample opportunity to make collective representations and to have their collective representations considered in good faith. [47] Alberta argues three recent appellate judgments provide analogous scenarios in which the courts correctly concluded that a restriction via legislation on government employee salaries did not breach the employees Charter, s 2(d) rights: Assn. of Justice Counsel v Canada (Attorney General), 2012 ONCA 530, 117 OR (3d) 532, leave denied [2012] SCCA No 430 [ Justice Counsel ]; Federal Government Dockyard Trades and Labour Council v Canada (Attorney General), 2013 BCCA 371, 343 BCAC 208, leave to the Supreme Court of Canada sought Nov. 18, 2013 [ Dockyard Trades ]; Meredith v Canada (Attorney General), 2013 FCA 112, 360 DLR (4th) 352, leave to appeal granted Sept. 19, 2013, [2013] SCCA No 263 [ Meredith ]. 3. Serious Issue Analysis [48] The following facts are particularly relevant to the analysis of whether the Action raises a serious issue or question: 1. AUPE is a body created by Alberta legislation, the PSERA, and is the sole representative for the employees of the Government of Alberta in the Crown bargaining unit. The employees in that Crown bargaining unit have no other legal vehicle by which to engage in collective processes with their employer, Alberta. 2. The legislation that authorizes AUPE includes a mandatory and binding arbitration procedure in the event of an unresolved contract dispute between AUPE and Alberta. 3. AUPE led by Perry and Alberta were engaged in negotiations in an attempt to reach a collective agreement prior to passage of the PSSRA. Those negotiations were partially successful and some non-monetary items were resolved. 4. AUPE and Alberta were engaged in a binding CAB process until the date the PSSRA came into effect. 5. The PSSRA: a) imposes a four year collective agreement, which has a 10 month retroactive and over a three year prospective effect, b) unilaterally sets all terms of the collective agreement between AUPE and Alberta, c) operationally and unilaterally negates any elements of an incomplete post- April 2013 collective agreement already negotiated and agreed upon by AUPE and Alberta, and d) prohibits a binding arbitration mechanism created by the legislation that authorizes AUPE. [49] The first step in the analysis is to consider whether the application falls into the exceptional category, where the stay remedy being sought effectively ends the dispute. I reject that argument. An injunction enabling the CAB to continue its operation does not end the

12 Page: 12 matter in AUPE s favour, as the evidence I have received is that tribunal has not reached a decision. I have no evidence on the relative positions of AUPE and Alberta in that matter and, in any case, that is irrelevant. It is enough to note that the process is ongoing. [50] The injunction sought by AUPE would not negate the wage control component of the PSSRA, nor does AUPE seek an order of that kind. In fact, no matter what the result of this proceeding Alberta will retain legislative authority to engage in any control of the terms on which AUPE s members work for the province of Alberta, even those that breach the Charter, s 2(d), provided, of course, that those terms comply with the requirements of the Charter, s 1. [51] It is fair to observe that at the hearing of this matter counsel for Alberta did not press this point but instead acknowledged the more common and lower threshold that AUPE is required to prove its action is not frivolous or vexatious. [52] With that preliminary step complete, I now move to decide whether the Charter challenge of the Applicants raises a serious issue or question. This actually involves two subissues, either of which is a potential basis for the Applicants to argue that Alberta has breached the s 2(d) rights of the employees in the Crown bargaining unit: 1. Does the PSSRA and PSERA permit a meaningful collective interaction process between AUPE employees and Alberta? and 2. Has Alberta engaged in good faith bargaining within that context? Each of these potential issues are dealt with separately. a. Meaningful collective process [53] In Fraser, at para 42, the majority explains that in a labour context a monologue is not a meaningful collective negotiation process:... A process which permits an employer not even to consider employee representations is not a meaningful process.... [Emphasis added.] [54] The PSSRA appears to cause that very result. As of March 31, 2014 and in the absence of a settlement, all collective bargaining will end and a new collective agreement will be in force until April, 2017: PSSRA, s 2(a). The statutory mechanism to resolve employer/union disputes has been terminated for the duration: PSSRA, s 4. It would seem therefore the PSSRA permits Alberta to not even consider any representations by AUPE. This simple fact suggests a serious issue or question exists as to whether Alberta has by legislation eliminated any meaningful collective process to discuss and address issues affecting the Crown bargaining unit. [55] It is helpful at this point to review the three appellate decisions cited by Alberta as showing the actions of the Applicants should be categorized as frivolous or vexatious, or weak and therefore that no breach of Charter, s 2(d) results from legislation such as the PSSRA. [56] In the Justice Counsel decision the Ontario Court of Appeal concluded that legislation which unilaterally set wage levels for Federal government employees did not infringe Charter, s 2(d) because the negotiations had reached an impasse, and there was no evidence to suggest the collective bargaining process that led to that point was not a good faith negotiation. In effect, the s 2(d) obligation had been discharged and Canada was free to act in a unilateral manner.

13 Page: 13 [57] The situation between AUPE and Alberta does not parallel this scenario. Negotiations between AUPE and Alberta were ongoing when Bill 46 was tabled and passed. I do not accept Alberta has proven that an impasse had emerged and therefore a legislative response was appropriate. [58] Dockyard Trades emerges from the same economic circumstances as Justice Counsel, and the British Columbia Court of Appeal concludes that the Charter, s 2(d) protected collective negotiation process should be viewed broadly, including not merely collective bargaining but other associated mechanisms such as mediation and arbitration. In this case a wage rollback and freeze was not so intrusive that it nullified the potential for meaningful future collective bargaining between the parties. [59] Unlike Dockyard Trades, the PSSRA ends the potential for future collective bargaining between AUPE and Alberta for over three years. While Alberta argues that there are other, alternative forms of potential negotiation and exchange I find those interactions are, effectively, meaningless. Returning to the Fraser decision, it appears that the PSSRA permits Alberta to not even consider any representations by AUPE. Certainly, there is the possibility that Alberta and AUPE may engage in meaningful collective bargaining while the PSSRA is in operation however, viewed pragmatically, there is no reason for Alberta to do so. It has already won the negotiation and dictated the terms. [60] The last case identified by Alberta, namely Meredith, again addresses the response to the 2008 economic crisis, and whether legislative restraint on RCMP salaries was Chartercompliant. RCMP wages are not the product of a collective bargaining process but instead are suggested by a body called the Pay Council which recommends compensation. No Charter, s 2(d) infringement was found because the Pay Council mechanism was operationally unaffected by the legislative restriction on RCMP pay (para 91), because even after legislative intervention the Pay Council continued to engage in meaningful negotiation to balance employee needs and priorities with the monetary restrictions placed on the RCMP (paras 92-95), the limited duration of the period of unilateral pay control (para 97), and because the new legislative scheme did not nullify an existing mandatory consultation process (para 98). [61] Meredith makes an interesting comparator to the post-pssra relationship between AUPE and Alberta. The only existing means for AUPE members to engage in collective interaction with their employer is rendered silent. Unlike the RCMP Pay Council, which continued to provide a functional mechanism for meaningful communication and negotiation of non-monetary issues, the PSSRA closes both direct and arbitrated dialogue on those issues. The duration of the wage controls is much longer than those experienced by the RCMP, and the PSSRA explicitly extinguishes a consultation process mandated by legislation. [62] At para 86 of Meredith, Dawson JA explained how the situation in Health Services was different from the situation faced by the RCMP: I begin by observing that legislation that significantly interferes with, or nullifies, existing collectively bargained terms of employment will not necessarily violate section 2(d): B.C. Health Services at paragraphs 92 and 96. As explained by the majority in Fraser at paragraph 76, the majority of the Court in B.C. Health Services did not find that a breach of a term of a collective agreement per se violated section 2(d) of the Charter. Rather, it was the unilateral nullification of

14 Page: 14 significant contractual terms, coupled with the effective denial of future collective bargaining, which violated the section 2(d) right to associate. [63] If this is a correct restatement of the appropriate test then I conclude that the Applicants have established an arguable case to conclude that its members, unlike the RCMP, have experienced restriction in their rights to access a collective negotiation process which constitutes a breach of their Charter, s 2(d) right. This represents one of the two bases on which I conclude that the Applicants have established that there is a serious question to be tried in this Action. b. Good faith bargaining [64] The second basis to conclude that the Applicants have established there is a serious question to be tried in this Action is that the conduct of Alberta arguably represents bad faith negotiations with its employees in the Crown bargaining unit. At para 40 in Fraser the Supreme Court of Canada reiterated its statement at para 90 in Health Services that discharge of the Charter, s 2(d):... requires both employer and employees to meet and to bargain in good faith, in the pursuit of a common goal of peaceful and productive accommodation. [65] My analysis of the evidence presented here raises the issue that Alberta did not meet its obligation to negotiate in good faith. The timeline and events prior to consideration and passage of Bill 46 are interpreted by me to conclude Alberta never intended that the 2013 negotiations with AUPE were to be meaningful. What is particularly concerning is the uncontested fact that Alberta and AUPE had come to meaningful agreements on certain issues during collective bargaining, but rather than respecting those points of common ground Alberta has by legislation wiped the slate clean when it unilaterally imposed all terms from the 2011 Collective Agreement. This raises the question of whether those negotiations were ever conducted in good faith, or were merely camouflage for a different agenda. The duration of this backtracking is also considerable; the Government of Alberta arguably reneged on four years of an agreed mutual relationship. [66] For these reasons I conclude that the Applicants have established that they have a claim which is not frivolous and vexatious and consists of Alberta s conduct infringing, or likely to infringe, the Charter, s 2(d) good faith dialogue and bargaining obligations. 4. Conclusion Serious Issue [67] The effective extinction of AUPE s capacity to engage in collective bargaining and the indicia of bad faith negotiation by Alberta each qualify as a basis to meet the serious issue criterion of the RJR - MacDonald three-part test. I note the caution provided in that decision to the effect that I should restrict myself to an extremely limited review of the case on the merits and only engage in a preliminary investigation. Therefore at this stage I will not expand further on my assessment of the strengths of the claims of the Applicants. B. Irreparable Harm [68] To pass the second step in the RJR - MacDonald three-part injunction test the Applicants must demonstrate that they will experience irreparable harm if an injunction is not granted.

15 Page: Applicants [69] The Applicants observe that Sharpe advocates a broad-based evaluation of deleterious effects that may establish irreparable harm, and that irreparable harm includes conceivable harms in a wide variety of circumstances. The Applicants rely chiefly on the evidence contained in the Fryer Affidavit to establish that irreparable harm flows from the PSSRA termination of the CAB arbitration process and the imposition of a four year collective agreement on the employees in the Crown bargaining unit. [70] In summary, the effect is two-fold in that unilateral imposition of the terms of employment via legislation subverts future union-to-employer bargaining, and also marginalizes the role of AUPE as a voice for employees in the Crown bargaining unit and as an interface for problem solving and development of helpful policies. The Applicants note that the conclusion of Professor Fryer is that the simple passage of the PSSRA, in itself, contributes to those negative outcomes; however the deleterious results may be ameliorated if the PSSRA effect is found unconstitutional, and particularly if the scheduled CAB hearings occur. Furthermore these injuries do not merely appear the next time the AUPE and Alberta negotiate a post-2017 collective agreement, but may also continue from passage of the PSSRA onward. [71] The Applicants observe that operationally a delay in resolution of labour disputes denies the protected benefits of collective dialogue with employers labour relations delayed is labour relations denied. : Pac Fab Industries Corp. (Re), [1996] Alta LRBR 65 at para 12, see also Toppin (Re), [2006] Alta LRBR 31, [2006] ALRBD No Alberta [72] Alberta stresses that the alleged irreparable harm cannot be based on speculation, citing Telecommunications Workers Union v Canada (Canadian Industrial Relations Board), 2005 FCA 83 at para 8, 138 ACWS (3d) 89 [ Telecommunications Workers Union #1 ]. Alberta notes that one of the potential injuries rejected in this judgment, that union members will lose faith in their union s capacity to conclude a collective agreement, is also argued by the Applicants. Alberta also cites International Longshore and Warehouse Union, Canada v Canada (Attorney General), 2008 FCA 3, 159 CLRBR (2d) 72 [ International Longshore ] for the same proposition that... the applicants must prove that actual harm will be suffered if the stay is not granted. It is not sufficient for the applicants to allege hypothetical or speculative harm. (para 22), see also Teamsters Local Union 847 v Canadian Airport Workers Union, 2009 FCA 44, 387 NR 36 [ Teamsters Local 847 ]. [73] Alberta also argues that Bodner v Alberta, 2002 ABCA 20, 299 AR 150 [ Bodner ] indicates that the members of AUPE have not suffered irreparable injury as no increased payment of wages will result if the CAB process were to continue to its conclusion. 3. Irreparable Harm Analysis [74] Alberta s chief complaint is that the irreparable harm identified by Professor Fryer is speculative and hypothetical. However, Fryer was quite explicit as to the kind of harm the PSSRA had and continues to cause to the members of AUPE. [75] Closer examination of the case law cited by Alberta indicates a situation different from the current application. In Telecommunications Workers Union #1 the injuries that made up the alleged irreparable harm were, quite literally, hypothetical, as those injuries required other intervening steps by the employer which had not yet occurred, but which might occur.

16 Page: 16 Rothstein JA (as he then was) specifically invites the parties to make another injunction application if the problematic but hypothetical scenario actually does occur, and that is precisely what later happened in Telus Communications Inc. v Telecommunications Workers Union, 2005 FCA 146, 139 ACWS (3d) 76. However, until that point no irreparable harm had been proven because one... cannot in advance say the negotiations are doomed and that an imminent strike or lock-out is inevitable. (para 19). [76] The scenario in Telecommunications Workers Union #1 is therefore entirely different than the irreparable harm alleged by the AUPE and opined on by Professor Fryer. The harm is not a future, contingent event, but an ongoing injury. [77] The decision in International Longshore is also of no relevance to the present litigation. In that action an injunction was refused because there was literally no evidence of the alleged harm: a breach of privacy if certain security procedures were implemented. Instead the evidence before the court was that this allegedly problematic scheme had been successfully implemented in many other locations without any such issue: paras A similar lack of evidence is what led to the result in Teamsters Local 847. [78] Here I have received evidence of alleged harms supported by academic works forming part of the literature, some of which was authored by Professor Fryer. [79] Teamsters Local 847 is also interesting in that one reason why Richard CJFCA concluded that the applicant had not proven irreparable harm was because it had a separate forum in which to address the alleged injury, the Canada Industrial Relations Board. Obviously that is different from the Applicants, which have had all mechanisms other than coming to this Court extinguished by legislation. [80] Bodner is not relevant to this application. That case concludes that irreparable harm may result to an employer where the employer may be unable to recover salary payments made during a stay. Here AUPE has indicated it will not seek any such increased wages found in the CAB process. Further, Bodner is only relevant to potential irreparable injury to Alberta, not AUPE or the members of the Crown bargaining unit. At the second stage of the RJR - MacDonald analysis the obligation is on the applicant to demonstrate irreparable harm, not the respondent. [81] I have admitted and accepted the expert opinion evidence from Professor Fryer, which indicates that the operation of the PSSRA causes ongoing injury to the relationship between the AUPE and its membership, affects the morale and workplace conduct of AUPE members affected by that legislation, and that the PSSRA will impede future collective bargaining between AUPE and Alberta. [82] In coming to that conclusion I am particularly struck by the unique and broad operation of the PSSRA. This legislation dictates the terms of an entire workplace employment arrangement without any input by the employees through their statutory bargaining agent AUPE. The scope and duration of this impact amplifies the deleterious effects of unilateral legislative control identified by Professor Fryer. [83] The proposed injunction will enable the CAB to continue the arbitration process. I accept the arguments that a delay in that process has two negative effects: 1. labour relations delayed is labour relations denied, and

17 Page: delay in the arbitration process provided for by legislation compromises the relationship between the AUPE and its membership. 4. Conclusion Irreparable Harm [84] I conclude on a balance of probabilities that the Applicants have established that the membership of AUPE, specifically in the Crown bargaining unit, will experience irreparable harm if the proposed injunction is not granted. The next and last step in this analysis is to balance the deleterious effects of an injunction on Alberta and the Applicants. C. Balance of Convenience 1. Applicants [85] The Applicants ground their balance of convenience arguments on para 34 of Lubicon Lake, supra, where the Court of Appeal described this stage of the analysis as requiring a first instance judge to weigh the harm done to the plaintiff from a refusal to grant the relief against the harm done to the defendant by the granting of the relief (para 34) and further, that in considering the balance of convenience, the likely success of the claim by a plaintiff must be weighed against the harm done to a defendant if the claim is not successful. The preservation of the status quo as being an appropriate factor to consider in assessing the balance of convenience was also mentioned, and Northlands, supra referenced. [86] The Applicants say that if the PSSRA is stayed that no obvious financial harm will befall Alberta, because AUPE is prepared to forego the implementation of any monetary terms which may be awarded in the CAB process, at least until this Action is brought to completion. They point out that a meaningful undertaking as to damages has been provided by AUPE. [87] The Applicants also argue that if a stay is granted, significant irreparable harm to the Plaintiffs will be avoided and the members of the Crown bargaining unit represented by AUPE will have an opportunity to see the CAB process play out. AUPE has already expended funds and effort to prepare for the CAB hearing. [88] As to the status quo argument, the Applicants submit that this concept should not be used to defeat the enforcement of a Charter right. [89] The Applicants accept that the public interest is an important consideration in the assessment of the balance of convenience, especially given their request to suspend the operation of the PSSRA. They point out that this legislation is aimed at saving money on the backs of the members of the Crown bargaining unit, but no other group of employees employed by Alberta. They argue that the public interest is an economic interest and that the Applicants are not seeking extra money and therefore the Government of Alberta will not be compelled to pay any increase in wages which the CAB process may conclude is appropriate. The Applicants submit that the legislation is aimed at AUPE and its members who are part of the Crown bargaining unit. [90] In respect to the argument by Alberta that a CAB award will help AUPE in its bargaining on behalf of other members which are not in the Crown bargaining unit, the Applicants say that there are many uncertainties, that this set of arguments is essentially speculative and should not represent a factor considered by the Court during the convenience weighing exercise. [91] The Applicants say that there will be no irreparable harm to Alberta from its participation in the CAB process, any cost to participate will be negligible in the overall scheme of things and,

18 Page: 18 in any event, the cost of such participation is quantifiable in damages in the event the Applicants are unsuccessful in this Action. [92] In closing, the Applicants remind the Court of the serious and long lasting effects on labour relations which should be weighed against the rather negligible costs of harm to the Government of Alberta for participation in the CAB process. The Applicants therefore ask that the balance of convenience be resolved in their favor. 2. Alberta [93] The primary argument of Alberta on weighing the balance of convenience relates to the public interest and is founded in a statement from the Supreme Court of Canada in Harper v Canada (Attorney General), 2000 SCC 57 at para 9, [2000] 2 SCR 764:... It follows that in assessing the balance of convenience, the motions judge must proceed on the assumption that the law -- in this case the spending limits imposed by s. 350 of the Act -- is directed to the public good and serves a valid public purpose. This applies to violations of the s. 2(b) right of freedom of expression; indeed, the violation at issue in RJR--MacDonald was of s. 2(b). The assumption of the public interest in enforcing the law weighs heavily in the balance. Courts will not lightly order that laws that Parliament or a legislature has duly enacted for the public good are inoperable in advance of complete constitutional review, which is always a complex and difficult matter. It follows that only in clear cases will interlocutory injunctions against the enforcement of a law on grounds of alleged unconstitutionality succeed. [Emphasis added] [94] Alberta puts special emphasis on these assumptions namely, that the PSSRA, as the challenged legislation, must be assumed to be directed to the public good and to serve valid public purposes, with fiscal restraint and the creation of reasonable market alignment of compensation with public sector employees in other Provinces. [95] A second head of argument is that while AUPE has agreed to stay any monetary award arising out of a CAB process, it will not agree to a stay of the resolution of any non-monetary issues arising from such an award. Alberta says that absent a stay, a CAB award is binding on the Government as an employer under the PSSRA. Alberta argues that if the Plaintiffs fail in their litigation then non-monetary aspects of a CAB award may impose costs on the Government which could not be unwound or the subject of compensation. [96] Alberta complains that AUPE is seeking to score political points by obtaining an award through the CAB process, which it could then use to show that the state employer has deprived the members of the Crown bargaining unit of legitimate increases in wages. Counsel for Alberta points to an article in a Union publication critical of the current Government which is said to show bad motives on the part of AUPE. [97] Alberta says further that AUPE will use a positive CAB award to lever better settlements for other bargaining units which it represents in collective bargaining with Alberta and this spillover effect will cause irreparable harm to Alberta and cannot be the subject of compensation. It is said these effects could be irreversible.