Submission by the Canadian Labour Congress to the Senate Standing
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Submission by the Canadian Labour Congress to the Senate Standing Committee on Legal and Constitutional Affairs Regarding Bill C-377 An Act to Amend the Income Tax Act (Requirements for Labour Organizations) April 2015 Submission by the Canadian Labour Congress to the Senate Standing Committee on Legal and Constitutional Affairs Regarding Bill C-377 An Act to Amend the Income Tax Act (Requirements for Labour Organizations) April 2015 Introduction The Canadian Labour Congress (CLC) is the national voice of 3.3 million workers in Canada. The CLC brings together Canada’s national and international unions along with the provincial and territorial federations of labour and 130 district labour councils whose members work in virtually all sectors of the Canadian economy, in all occupations, and in all parts of Canada. In the opinion of the CLC, Bill C-377 infringes Canadians’ freedom of association and is contrary to Section 2(d) of the Canadian Charter of Rights and Freedoms. The bill intrudes into provincial jurisdiction with respect to the regulation of labour relations and unions and is ultra vires. Bill C-377 contravenes federal and provincial privacy legislation, and singles out and discriminates against unions compared to other organizations similarly treated in the Income Tax Act. Finally, it will impose significant, unnecessary and unwarranted costs on the government and labour organizations. In the words of Senator Hugh Segal, Bill C-377 is “an expression of statutory contempt for the working men and women in our trade unions and for the trade unions themselves and their right under federal and provincial law to organize.”1 There is no demonstrable rationale for Bill C-377, and arguments used to justify the bill are feeble at best. In fact, there is only one underlying reason for this bill: to single out, interfere with, and weaken unions. The Congress believes C-377 is an unwarranted, unconstitutional, venal and indefensible bill that is inherently flawed and must be withdrawn. 1 Senator Hugh Segal, Hansard, 17 June 2013. Submission to the Senate Standing Committee on Legal and Constitutional Affairs regarding Bill C-377 Constitutional Protection of Collective Activity of Workers The vital social, political and economic role of unions in a democratic society has been recognized on several occasions by legal commentators as well as the Supreme Court of Canada. The 1991 Lavigne decision of the Supreme Court of Canada recognized the importance and legitimacy of trade unions in engaging in political and advocacy activities. Speaking for the majority, Justice La Forest wrote: Unions' decisions to involve themselves in politics by supporting particular causes, candidates or parties, stem from a recognition of the expansive character of the interests of labour and a perception of collective bargaining as a process which is meant to foster more than mere economic gain for workers. From involvement in union locals through to participation in the larger activities of the union movement, the current collective bargaining regime enhances not only the economic interests of labour, but also the interest of working people in preserving some dignity in their working lives... Whether collective bargaining is understood as primarily an economic endeavour or as some more expansive enterprise, it is my opinion that union participation in activities and causes beyond the particular workplace does foster collective bargaining. Through such participation, unions are able to demonstrate to their constituencies that their mandate is to earnestly and sincerely advance the interests of working people, to thereby gain worker support, and to thus enable themselves to bargain on a more equal footing with employers. To my mind, the decision to allow unions to build and develop support is absolutely vital to a successful collective bargaining system.2 Section 2(d) of the Charter of Rights and Freedoms explicitly recognizes the right of the freedom of association as one of Canada’s fundamental freedoms. The Supreme Court has held that “[t]he right to bargain collectively with an employer enhances the human dignity, liberty and autonomy of workers by giving them the opportunity to influence the establishment of workplace rules and thereby gain some control over a 2 Lavigne v. Ontario Public Service Employees Union, [1991] 2 S.C.R. 211 Canadian Labour Congress 4 www.canadianlabour.ca • April 2015 Submission to the Senate Standing Committee on Legal and Constitutional Affairs regarding Bill C-377 major aspect of their lives, namely their work.”3 The court recently reinforced this finding in Mounted Police Association of Ontario v. Canada: The [freedom of association] guarantee functions to protect individuals against more powerful entities. By banding together in the pursuit of common goals, individuals are able to prevent more powerful entities from thwarting their legitimate goals and desires. In this way, the guarantee of freedom of association empowers vulnerable groups and helps them work to right imbalances in society. It protects marginalized groups and makes possible a more equal society.4 Historically, Canada’s parliament and all the provincial legislatures have recognized the unique and important role played by Canada’s labour organizations by implementing legislation that not only recognizes the expressive and associational rights of workers and their unions, but also their responsibilities. While the federal and provincial governments and the Supreme Court of Canada have reinforced the right of unions to function as legitimate organizations participating in a democratic society, Bill C-377 sets out to deliberately weaken unions and attack that legitimacy. Constitutionality of Bill C-377 Interference in the Administration of Trade Unions In our view, when subjected to a “pith and substance” analysis to determine the true nature and effect of the bill, as opposed to its mere stated and apparent purpose, Bill C-377 seeks to regulate the behaviour, internal practices, and financial reporting of a single group of organizations, namely, unions. As the Certified General Accountants Association of Canada told the Senate Banking Committee in 2013, “Bill C-377 is not a tax bill. It’s a bill that requires a specific sector of civil society to disclose extensive financial information about its activities–a level of reporting that is not required of any other organization.”5 3 Health Services and Support Facilities Sub-Sector Bargaining Association. British Columbia. [2007] 2 S.C.R. 391 4 Mounted Police Association of Ontario v. Canada (Attorney General), 2015 SCC 1, para. 58. 5 Certified General Accountants Association of Canada, Presentation to the Senate Standing Committee on Banking, Trade and Commerce, May 29th, 2013. Canadian Labour Congress 5 www.canadianlabour.ca • April 2015 Submission to the Senate Standing Committee on Legal and Constitutional Affairs regarding Bill C-377 Interference in the internal affairs and administration of trade unions is prohibited under the Canada Labour Code and provincial labour relations statutes. Canadian courts have recognized that constitutional protection for freedom of association is necessary in part due to the ability of employers to interfere with workers’ democratic self-association and self-governance. In Delisle v. Canada (Deputy Attorney General), Justice L'Heureux-Dubé warned of "the inherent vulnerability of employees to pressure from management, and the private power of employers, when left unchecked, to interfere with the formation and administration of unions."6 Bill C-377 also contravenes the freedom of association guarantee under the Charter. According to the Canadian Bar Association, the bill “interferes with the internal administration and operations of a union, which the constitutionally protected freedom of association precludes, unless the government interference qualifies as a reasonable limitation upon associational rights. It is unclear from the Bill what the justification is for these infringements.”7 Bill C-377 is an open invitation to employers and anti-union groups to interfere in internal union affairs. Anti-union organizations may, within the limits of federal and provincial/territorial law, continue to oppose the formation of unions. What they should not have is an ally in the federal government assisting and supporting their efforts to diminish the power of unions and limit workers’ rights. Bill C-377 helps these anti-union organizations and employers. It is not the role of government to adopt laws that will weaken the Charter rights of Canadians. The intent of the anti-union organizations that support and impel Bill C- 377 is consistent with the expressed aims of the proponents of similar financial disclosure requirements imposed on U.S. trade unions under the George W. Bush administration. Then-representative Newt Gingrich urged in 1992 the adoption of extensive reporting requirements because it would “weaken our opponents and encourage our allies.”8 Conservative activist Grover Norquist boasted that “every dollar that is spent [by labour unions) on disclosure and reporting is a dollar that can’t be spent 6 Delisle v. Canada (Deputy Attorney General), [1999] 2 S.C.R. 989, paragraph 7. 7 Canadian Bar Association, letter to James Rajotte, September 17, 2012. 8 Cited in Scott Lilly, Beyond Justice: Bush Administration’s Labor Department Abuses Labor Union Regulatory Authorities, Center for American Progress, December 2007, p. 4. Canadian Labour Congress 6 www.canadianlabour.ca