Labourers International Union of North America v Nipissing First Nation: A Case Study

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1 Volume 14, No. 1 December 2012 Labour & Employment Law Section Labourers International Union of North America v Nipissing First Nation: A Case Study Sean McFarling The intersection of provincially regulated labour relations and the rights of First Nations has been an interesting and evolving area of law for lawyers practicing in this unique area of law. In November 2011, the Ontario Labour Relations Board ( OLRB ) issued its decision in Nipissing First Nation 1 wherein it confirmed that certain construction activities performed by employees of the Nipissing First Nation ( NFN ) fell within the band s core function of governance, and therefore, was federally regulated. Background This case arose from an application for certification filed under the construction provisions of the Labour Relations Act, 1995 ( LRA ) by the Labourers International Union of North America, Ontario Provincial District Council for construction labourers employed by NFN in the North Bay area. NFN raised several objections to the application; however, the matter was determined on the basis that the Board lacked jurisdiction because the NFN s labour relations were federally regulated. Few facts were in dispute. NFN employed approximately 120 employees across 13 departments. The two individuals in the bargaining unit the Union sought to represent were employed in Public Works division of the Facilities and Infrastructures department. The duties of the two employees subject to the application included grading, and extending roads, installing culverts, and making sewer and water main connections to residential homes. All work was performed on the reserve for the benefit of band members. Furthermore, the individuals in question did not perform construction work exclusively. The facts established that this work was part of their overall public works duties, which also included trash collection and winter road maintenance. 1 Labourers International Union of North America v Nipissing First Nation, 2011 CanLII (ON LRB).

2 - 2 - Union s Submissions The Union premised it submission on the well-established principle that labour relations are a presumptively provincial matter. Exceptions exist only if it can be shown that federal jurisdiction over labour relations is integral to federal jurisdiction over the normal and habitual activities of the undertaking as a whole. In this specific case, the Union conceded that the NFN (and its employees) were federally regulated with respect to band administration and governance functions. However, the Union argued that the construction activity of the NFN was distinct and severable from its governance functions. In support of its argument, the Union relied on the following 2 : Employers can be subject to both provincial and federal labour laws, and therefore, it is necessary to determine if the particular activity or work of a federally regulated activity is fundamental to the core power at issue (See, for example: Toronto Dominion Bank, [1992] OLRB Rep. October 1123, aff d [1993] OLRB Rep. June 578 (Div. Ct.); leave to appeal to the C.A. refused, [1993] OLRB Rep. June 578n; and leave to appeal to S.C.C. refused, [1994] OLRB Rep. January 127); Where a business is owned and operated by a band council, like the NFN, the business is provincially regulated (See: Nipissing First Nation Fur Dressers Inc., [1999] OLRB Rep. November/December 1075 ); Construction work on a federal undertaking such as a bank, nuclear reactor, airport, or Indian Reserves is provincially regulated (See: Toronto Dominion Bank, supra); Construction work is not core to the governance power exercised by NFN because: o The federal funding arrangements do not require construction work to be done by the NFN using its own employees; o The NFN can and has contacted large scale contracts for construction on the reserve to provincially regulated employers; o The work done by NFN s employees could have been contracted to another employer and that employer would clearly be provincially regulated (See: Yellow Jacket Welding Co., [1974] OLRB Rep. October 709). 2 For a full review of the jurisprudence relied on by the Union, please see ibid. at paras

3 - 3 - OLRB s Determination Relying on the thorough and thoughtful submissions of the NFN, the OLRB rejected the Union s arguments and found that when NFN employs individuals to connect sewers and water mains to the home of a band member; grades, extends or improves a road in the reserve; or constructs a culvert, it is engaged in its core function of reserve governance which falls within federal jurisdiction over Indians and Lands reserved for Indians as contemplated by section 91(24) of the Constitution Act, Beginning with the analysis set on in the Federal Court of Appeal s decision in Francis v. Canada Labour Relations Board, [1981] 1 F.C. 225, the OLRB concurred that, The total administration of the band is continuously concerned with the status and the rights and privileges of the band Indians ; therefore, the labour relations in issue here are in integral part of primary federal jurisdiction over Indians or Lands reserved for Indians. 3 The OLRB further agreed with the Saskatchewan Court of Appeal s decision in Whitebear Band Council, [1982] 3 W.W.R. 554 wherein the court found that the construction of homes by carpenters employed by the band was part and parcel of the general operation as a whole of the band council that could not be properly removed from the whole and viewed as an ordinary industrial activity. 4 Finally, the OLRB adopted the reasoning of the Manitoba Labour Board s decision in Norway House Cree Nation, [2008] M.L.B.D. No. 30 that, the legislative authority of the Band qua employer is federal as a Band Council is a creature of the federal Indian Act and may only lawfully exercise such powers as are provided to it by virtue of that legislation. That is not to say that in every instance where a First Nation is an employer, the labour relations are federally regulated. Rather, there has been emphasis placed upon the Band s undertaking being within the realm of its normal or habitual activities undertaken in discharging it local governmental functions as empowered by Parliament in the Indian Act. 5 In arriving at its determination the OLRB found the following persuasive: 3 Ibid. at paras. 43 and Ibid. at para Ibid. at para. 61.

4 - 4 - All the work was performed on the reserved, under the direction of the NFN for the benefit of band members residing on the reserve; The NFN s goals as part of its governance activity was sustainable development of infrastructure and community resources; The Indian Act specifically delegated responsibility for the maintenance of roads, bridges, ditches, and fences on the reserve to the NFN; The Funding Agreement with the federal government referred to the construction of physical works as a core funded program ; and The employees were not engaged exclusively in construction work nor was there a department or division of the NFN devoted exclusively to construction; The fact that the work in question or any other construction work could be contracted out to an employer that would be provincially regulated was irrelevant. When the band self-performs such work it is exercising governance function in ensuring the performance of its federally mandated obligations and responsibilities; The cases relied on by the Union, where the construction activity of certain federally regulated entities (banks, nuclear power generators, uranium mines) was provincially regulated. were distinguishable on the basis that this construction activity was not core to the federal undertaking. In contrast, the construction activity at issue in this case was part of the NFN s core governance function. Conclusion This decision confirms that the labour relations activities of First Nation band councils pertaining to the administration and governance of the reserve is exclusively within federal jurisdiction including construction work as it relates to certain reserve infrastructure. However, questions remain for labour lawyers working in the construction industry. Although not set out in the decision, the Union noted that construction work in Ontario is highly regulated, particularly in the institutional, commercial, and industrial sector where various Ministerial Designations determine the parties who have the right to bargain provincially mandated collective agreements. Accordingly, the Union argued that significant policy concerns could arise if First Nations construction activities and labour relations operated outside this highly regulated provincial regime. This submission was implicitly rejected by the OLRB at the outset of its decision when the Vice-Chair noted, I am not concerned with whether NFN engaging in construction industry work in the abstract results in NFN operating outside of its governance function. I am concerned

5 - 5 - with whether, when the NFC performs the very construction work that it in fact does perform from time to time using its own direct employees, it is operating outside of its governance function. 6 Nevertheless, questions remain with respect to the limits of governance activity and provincial jurisdiction over the construction labour relations of First Nation s band councils. If the NFN s labour relations are provincially regulated when it owns and operates a business as they were in Nipissing First Nations Fur Dressers Inc., would it also be provincially regulated if it employed individuals to construct the building where this business operated? Could a band council be exempt from the provincially regulated ICI construction sector if such work is undertaken as a governance initiative or is commercial activity unrelated to governance? The opening comments in the OLRB s decision in this matter suggest that these are issues that need to be determined on a case-by-case basis. Finally, this case highlights an underlying concern for advocates of First Nation selfgovernment. As long as First Nation s autonomy is the subject of federally delegated powers there will always be circumstances where the actions of a band council may be provincially regulated. The current analysis focuses on whether a band council is engaged in the core activity of governance when it undertakes a given activity. However, this analysis leads, inevitably, to a determination as to whether the activity is sufficiently Indian, as defined by the Indian Act, particularly if the activity is commercial in nature. One might argue that for First Nation to attain true self-governance and control over their affairs we will be required to reframe the entire labour relations debate with a focus on a genuine respect for the inherent sovereign rights of First Nations peoples to decide these matters for themselves independent of Provincial and Federal spheres of power. About the Author: Sean McFarling is a graduate of Queen s University Faculty of Law where he focused his studies on both labour law and the constitutional rights of First Nations. He has practiced for many years as union-side legal counsel with a particular focus on construction trade unions. Sean is currently senior counsel to the Labourers International Union of North America, Ontario Provincial District Council where his duties include working with First Nations to develop accords for training and cooperation on infrastructure projects. Sean comes from a family of proud trade unionists and members of the Woodland Metis Tribe. 6 Ibid. at para. 7 [emphasis in the original].