SCC alcohol testing decision invites peace in the valley by giving a boost to arbitral precedent

The Supreme Court of Canada’s June 14th decision in Irving Oil represents a remarkable elevation of arbitral precedent to near binding law, contributing clarity on an issue that has been heavily litigated by employers and unions for years.

The ratio, at paragraph 31, is that an employer with a safety-sensitive workplace needs proof of “enhanced safety risks” (such as a workplace substance abuse problem) to implement universal random substance testing. Although the judgment was split, both majority and minority agree that this is the evidentiary burden endorsed in “remarkably consistent arbitral jurisprudence.”

The Supreme Court of Canada wanted to deliver “peace in the valley” without causing too much upset in its established deference-favouring principles of judicial review.

Upset is exactly what the Court of Appeal of New Brunswick had created by issuing an unprecedented standard of review decision in its handling of the case. The lower court applied the correctness standard of review because labour arbitrators had not been able to reach a consensus. Justice Robertson said:

In the present case, it is evident that the arbitral jurisprudence is not consistent when it comes to providing an answer to the central question raised on this appeal. Hence, it falls on this Court to provide a definitive answer so far as New Brunswick is concerned.

In response, the Supreme Court of Canada held that the reasonableness standard applies to the interpretation of a collective agreement based on its established jurisprudence. It did not mention Justice Robertson’s novel approach to addressing an inconsistency in arbitral jurisprudence nor did it explain how it reached the opposite conclusion about the existence of arbitral consensus. Did it find the jurisprudence to be consistent as step one in its aim to promote clarity in the law?

Step two involves the Court’s treatment of arbitral precedent in assessing the reasonableness of Arbitrator Veniot’s decision. The Court unanimously held that the reasonableness of a labour arbitrator’s decision will be judged in light of established arbitral consensus.The majority felt that Arbitrator Veniot’s decision was consistent with the consensus, which supported its reasonableness. The minority felt that Arbitrator Veniot’s decision was inconsistent with the consensus, an error given he did not provide a rationale for his departure: “In the absence of a reasonable explanation for its novel test, the board must be taken as having misapplied the existing test, which in the circumstances of this case rendered its decision unreasonable.” This treatment of arbitral precedent as so central is novel and significant, though both the majority and minority specified that precedent was particularly important “in this case,” presumably given the deemed “remarkably consistent arbitral jurisprudence.”

Arbitrators are technically free to reason their way around the ratio of Irving Oil, but why would they? For practical purposes, the Court has delivered near binding precedent.

Of course, the non-unionized employees are much more vulnerable, many protected only by anti-discrimination legislation and a theory for finding discrimination espoused in the Court of Appeal for Ontario’s Entrop decision that is becoming less and less consistent with the SCC-defined meaning of discrimination. In light of the Supreme Court of Canada’s gymnastics in Irving Oil, is there any doubt that the courts will find a path, however tortured, that leaves non-union employees with the same protection?

Communications, Energy and Paperworkers Union of Canada, Local 30 v Irving Pulp & Paper, Ltd, 2013 SCC 34 (CanLII).

“Drug abuse” diagnoses justifies random testing requirement

Last November 29th, Arbitrator Hall held that an employer could impose random drug testing on a employee in a safety-sensitive position who admitted to regular cannabis use outside of the workplace and who had been diagnosed as a “drug abuser” but not “drug dependent.” He explained:

…a closer review of the authorities reveals that arbitrators have distinguished between “use”, “abuse”, and “dependence/addiction”. Once the distinction between use and abuse in particular is recognized, the Union’s comparison to the casual consumption of alcohol away from the workplace is no longer compelling. The distinction was made in Hamilton Street Railway in these terms: “Use does not equate to abuse and it does not follow that because the grievor may use infrequently he will one day arrive at work impaired” (para. 33; emphasis added).

Although he upheld the random testing requirement, Arbitrator Hall ordered the employer to reduce testing frequency to quarterly from monthly and to limit testing to cannabis.

Spectra Energy Transmission – West and Communications, Energy and Paperworkers Union of Canada, Local 686b (29 November 2012, Hall).

Owner with a site access drug testing policy not a co-employer

On January 11th, the Alberta Court of Appeal issued a significant site access drug testing decision in which it held the owner of a construction site did not co-employ a subcontractor’s employee for the purpose of Alberta human rights legislation.

The employee worked for a subcontractor on a construction site owned by Syncrude. Syncrude required all contractors’ employees to have a drug test as a condition of site access. The employee failed, filed a human rights complaint and succeeded in arguing that Syncrude was a co-employer before a human rights panel. The Panel chair stated, “It would be an organization façade to think that a company could circumvent human rights legislation by inserting a contractor between the company and the workers it requires to build its project.”

The Court of Appeal held that co-employment is possible under the Alberta Human Rights, Citizenship and Multiculturalism Act and articulated factors for assessing whether co-employment exists, but held that the Panel erred in finding Syncrude was a co-employer. It appears that Syncrude’s relationship with its general contractor and the various subcontractors on its site was nothing out of the ordinary. The Court commented:

It is Lockerbie & Hole [the complainant’s “true” employer] that must ensure that Mr. Luka’s rights under the Act are respected, and that any discrimination demonstrated by Mr. Luka is either a bona fide occupational requirement under ss. 7(3), or “reasonable and justifiable in the circumstances” under s. 11. Any duty to accommodate a disability that arises must be met by Lockerbie & Hole. Mr. Luka is not denied rights under the Act, but the burden of protecting them falls on Lockerbie & Hole…

If Mr. Luka worked for one of Lockerbie & Hole’s subcontractors, he presumably would have five employers: the subcontractor, Lockerbie & Hole, Marsulex, Kellogg Brown and Root, and Syncrude. If he was further down the contractual chain, he might have even more employers. This is not a result the Legislature should be taken to have intended by the use of the word “employer”.

This is an important site access drug testing decision. Furthermore, the Court’s reasoning on the meaning of “employer”  and the parameters for co-employment under human rights legislation are of general importance with implications outside of Alberta.

Lockerbie & Hole Industrial Inc. v. Alberta (Human Rights and Citizenship Commission, Director), 2011 ABCA 3 (CanLII).

SCOTUS background check case is very… American

Today, the Supreme Court of the United States unanimously decided that elements of a background check administered to contractors working at a NASA laboratory are constitutionally permissible.

The contractors challenged a question that asks whether individuals have “used, possessed, supplied or manufactured illegal drugs” in the last year and a question to those answering “yes” about “treatment or counseling received.” They also objected to the breadth of inquiries routinely made to references, including questions that sought facts potentially related to “honesty or trustworthiness,” “financial integrity,” “abuse of alcohol and/or other drugs,” and “mental or emotional stability.”

Justice Alito wrote the majority opinion. He assumes, without deciding, that a right to “informational privacy” exists under the United States Constitution but holds that, in any event, the background check questions at issue are justifiable on a contextual balancing of interests. He stresses that government, when acting as employer, has a much “freer hand” to deal with individuals, stresses the pervasiveness of similar screening questions in the private sector and stresses that the information collected is well-protected by the federal Privacy Act.

Justice Scalia, with Justice Thomas concurring, wrote a concurring opinion in which he holds there is no constitutional right to “informational privacy.” He mocks the contractors for their failure to rely on a single provision of the Constitution in written argument and criticizes the majority for its “damaging” “never-say-never” position.

Justice Scalia’s display of sharp wit is well worth a read, but as Canadian employment law practitioner, the following statement by Justice Alito is even more remarkable:

Like any employer, the Government is entitled to have its projects staffed by reliable, law-abiding persons who will“‘efficiently and effectively’” discharge their duties. See Engquist, supra, at 598–599. Questions about illegal-drug use are a useful way of figuring out which persons have these characteristics. See, e.g., Breen & Matusitz, An Updated Examination of the Effects of Illegal Drug Use in the Workplace, 19 J. Human Behavior in the Social Environment, 434 (2009) (illicit drug use negatively correlated with workplace productivity).

This shows such different values than currently reflected in our own screening law. In particular, Canadian adjudicators have expressed great discomfort with the suggestion that individuals who casually use illegal drugs outside the workplace will be less efficient, effective or reliable while at work. Justice Alito (and his six esteemed colleagues) draw the link between illegal drug use simpliciter and workplace performance so easily that it makes you wonder whether we are missing something.

NASA v. Nelson, 562 U.S. ____ (2011).

Case Report – Ont. C.A. affirms arbitration board’s principled attack on random drug testing

Yesterday the Ontario Court of Appeal affirmed a December 2006 award by an arbitration board chaired by Michel Picher in which he held that Imperial Oil breached its collective agreement with Local 900 of the CEP by implementing random drug testing by buccal swab.

The Court of Appeal’s judgement turns on the standard of review rather than on principle. The Court did not feel it necessary to reconcile the majority’s strong stance against random drug testing with its own affirmation of random alcohol testing in the year 2000 Entrop decision. It simply noted that Mr. Picher had distinguished Entrop because Imperial Oil’s testing method took two days to return a test result. The Court said:

Moreover, the Majority was alert to Imperial’s contention that its random oral fluid drug testing was analogous to the random alcohol breathalyser testing approved in Entrop. As it was entitled to do, the Majority considered, and rejected, this contention on the basis of the evidence before it that oral fluid drug testing in fact did not permit immediate detection of drug impairment on-the-job (paras. 64 and 112-113).

While this might appear to still leave employers with room for implementing random drug testing based on a method that does address current impairment, Mr. Picher did make a very principled attack on random drug testing, suggesting it was unreasonable unless an employer is able to adduce evidence of “extreme circumstances” such as an “out-of-control drug culture.” Mr. Picher’s award does not bind other arbitrators who are charged with interpreting other collective agreements, but it is authoritative, particularly after yesterday’s affirmation.

For my earlier, more comprehensive summary of the case, see here.

Imperial Oil Limited v. Communications, Energy & Paperworkers Union of Canada , Local 900, 2009 ONCA 420.