Canadian Employment Law Today

Canadian Employment Law Today | 7 Canadian HR Reporter, a Thomson Reuters business 2014 More Cases Supreme Court of Canada dismisses challenge to allocation of ei funds The SupReMe CouRT of Canada has dismissed an appeal by two Quebec unions to force the federal government to transfer $57 billion raised through employment in- surance (EI) premiums into a new fund. Following the federal government's reform of the EI program in 1996 by enacting a new Employment Insurance Act, two Quebec unions challenged the constitutionality of some of the provisions in the act, which al- lowed annual EI surpluses to be reallocated by the federal government to cover its general expenses. e unions argued this was a mis- appropriation of funds meant for EI. e Supreme Court of Canada ruled on Dec. 11, 2008, that the 1996 act was constitu- tional, except for provisions applied in 2002, 2003 and 2005, when the premiums were set by the Governor in Council — who didn't have tax-delegating authority. e court suspended a declaration of invalidity for 12 months to allow Parliament to amend the act. In the meantime, enough money was raised through EI premiums to accumulate a $57 billion surplus in the EI account by Jan. 1, 2009. In 2010, Parliament enacted the Jobs and Economic Growth Act, which provided for the closure of the EI account and the creation of a new EI operating account. ere was no specification that the money in the EI account was to be transferred to the new EI operating account, and as a result the $57 billion surplus was absorbed into the federal government's general revenues. Two more Quebec unions — the Con- féderation des syndicats nationaux and the Fédération des travailleurs et travailleuses du Québec — filed a motion demanding the new 2010 act be declared unconstitutional because of the failure to maintain the surplus funds from the EI program for EI purposes. e unions sought a declaration that any change in the mechanism for setting premi- um rates may not disregard the sums collect- ed in the EI account and that the balance in the account may not be erased and allocated. e Quebec Superior Court dismissed the motion, finding EI premiums were either a payroll tax or regulatory charge that, once collected, were part of the federal govern- ment's revenues and "not a debt owed to the (EI) program." erefore, they did not have to be used for the EI program, said the court. e unions appealed to the Quebec Court of Appeal, which set aside the lower court's decision. e appeal court found the unions' challenge of the 2010 act was more concerned with the actual elimination of the EI surplus, rather than for what the government used it. e federal government appealed to Can- ada's top court, on the basis that the issue was covered in the Supreme Court's 2008 deci- sion that allowed surpluses to be reallocated, though the specific surplus at issue didn't yet exist. It also argued the EI account was "merely an accounting tool" that recorded EI amounts. All actual transactions, such as EI premium payments or distribution of ben- efits, were conducted through the govern- ment's consolidated revenue fund, not the EI account, said the government. e Supreme Court noted that the unions' underlying premise was that "a balance in the EI account is a debt owed by the consolidated revenue fund to the EI account" and the con- stitutional validity of the act depended on the transfer of that debt to the new operating ac- count established under the 2010 act. e Supreme Court found that, as estab- lished in an earlier decision, the EI account was not a trust fund, but rather "forms part of Canada's government accounting, and premiums form part of the government's revenues." e top court agreed with the Quebec Superior Court that "as government revenues, the amounts collected as contribu- tions to the EI program can therefore be used for purposes other than paying benefits." e consolidated revenue fund from which actual EI transactions were made did not have any debt to the EI account, and the Quebec Court of Appeal erred in finding there was a direct debt, said the Supreme Court. "(In earlier decision CSN v. Canada), the court held that the connection between the program and the premiums is a factor that can be considered in determining the nature of the levies," said the Supreme Court. "But it is wrong to say that the validity of these levies depends on the existence of that connection." Because the underlying premise of the motion was based on a debt to the new EI account which the court found did not ex- ist, the Supreme Court determined the ac- tion had no reasonable chance of success and dismissed it. See Canada (Attorney General) v. Confédération des syndicats nationeaux, 2014 SCC 49 (S.C.C.). a crude comment to her. • R.V. made comments about her mother and her own sexual activity. e company investigated and interviewed various employees, some of whom said R.V. consistently made graphic sexual remarks about women and called the female co-worker "a fat pig and a fat cow," but R.V. denied the allegations. e evidence was sufficient to prove R.V.'s harassing conduct, so Unimin suspended him for 15 days. He was given a suspension letter that stipulated any retaliation against the co-worker who filed the complaint would result in "immediate termination." e company agreed to reduce the suspension to 10 days if R.V. wrote a letter of apology to the company and the female co-worker. R.V. submitted an apology letter that said: "I am found to be in 'breach of company policy. From this day forward I will conduct myself free from un- professional behaviour towards complainants and to Unimin's satisfaction." R.V. returned to work on Sept. 25, 2013. About four weeks later, the company became aware of potential retaliatory conduct by R.V. e female co-worker said he refused to talk to her and often looked at her, then looked away and would say something to someone else. Another employee reported that he had heard R.V. say words to the effect that "once the dust settled, he would go after (the female co-worker)." e employee also said R.V. stood up in the lunchroom and told a group of employees loudly that he had a list of everyone who had talked, he hadn't apologized, the terms of his apology were lame and he knew the names of the people who par- ticipated in the investigation. R.V. was also heard telling someone "there are rats everywhere." Unimin terminated R.V's employment on Nov. 5, 2013, for violating its harassment policy and his obligation to refrain from retaliatory conduct against his female co-worker. e arbitrator found the female co-worker's report of R.V. looking at her and whispering things to colleagues was hearsay and could not be relied upon as retaliatory or intimidating conduct. However, the other worker's report of his comments and his announcement to a group of employees was serious. His denials of such behaviour was "not remotely credible," said the arbitrator. e arbitrator found R.V. showed no remorse in his misconduct and violated the company's harassment policy and his suspension agreement. e termination was upheld. See Unimin Canada Ltd. and USW, Local 5383 (V. (R.)), Re, 2014 CarswellOnt 8915 (Ont. Arb.). Harassment continued after suspension « from WoRKeR on page 1

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