Divisional Court upholds Board decision on federal / provincial jurisdiction
The OLRB and the Courts resist efforts to take construction labour relations out of provincial jurisdiction
Are the labour relations of a general contractor working on a nuclear remediation project declared for the general advantage of Canada pursuant to section 71 of the Nuclear Safety and Control Act (the “NSCA”) under federal or provincial jurisdiction?
That was the question before the Ontario Labour Relations Board and then the Divisional Court in Amec Foster Wheeler Americas Limited v. Labourers’ International Union of North America, one of several recent federalism cases regarding Ontario Labour Relations Board’s jurisdiction over the labour relations of construction contractors claiming to be subject to federal jurisdiction.
Amec Foster Wheeler Americas Limited (“Amec”) was an international giant performing consulting, construction and construction management services in over 55 countries around the world.
In Ontario, Amec was the general contractor for part of the Port Granby project, a low-level radiation waste storage and remediation project forming part of the broader Port Hope Area Initiative (“PHAI”), a federal government project for the long-term management of historic low-level radioactive waste. Amec’s work on the project was performed pursuant to a nuclear license issued to Atomic Energy of Canada Limited (“AECL”) and then to Canadian Nuclear Laboratories Ltd. (“CNL”) pursuant to section 24 of the NSCA. Amec performed its work on the project on contract to CNL.
Labourers’ International Union of North America, Ontario Provincial District Council (the “Labourers’”) filed a construction industry application for certification against Amec with the Ontario Labour Relations Board (the “Board’) on February 22, 2017. This application was listed together with an application filed with the Board by the International Union of Operating Engineers, Local 793 (the “Operating Engineers’) on January 26, 2017.
In its response to both applications, Amec argued that the applications ought to be dismissed on the basis that its labour relations were subject to federal jurisdiction. Amec argued that it was a federal undertaking because it was a work or undertaking declared to be for the general advantage of Canada pursuant to section 71 of the NSCA, which stated that:
Any work or undertaking constructed for the development, production or use of nuclear energy or for the mining, production, refinement, conversion, enrichment, processing, reprocessing, possession or use of a nuclear substance or for the production, possession or use of prescribed equipment or prescribed information is declared to be a work or undertaking for the general advantage of Canada.
In the alternative, Amec argued that it was a federal undertaking “because it [stood] in the place of CNL in carrying out the excavation and relocation of the waste.” It argued that its employees were “employed on or in connection with the operation of” the Port Granby project, citing section 4 of the Canada Labour Code.
In the further alternative, Amec argued that it was subject to derivative federal jurisdiction on the basis that it was vital, essential and integral to the federal undertaking.
There was no dispute that the labour relations of all of PHAI, AECL and CNL were subject to federal jurisdiction, and that the Port Granby Project was federally regulated under the NSCA, given that it was a work or undertaking constructed for the possession of a nuclear substance. The question at hand was whether Amec was able to rebut the strong presumption of provincial jurisdiction over its own labour relations.
The Board’s decision
On June 27, 2018, in a lengthy 107-page decision, the Board concluded that Amec’s labour relations were subject to provincial jurisdiction.
The Board determined that Amec was not a work, business or undertaking for the general advantage of Canada and did not fall under direction jurisdiction.
The Board also rejected Amec’s claim to derivative federal jurisdiction, concluding that “[i]n the end, Amec is no more vital or integral than any construction contractor hired by a federal undertaking.”
Having determined that Amec’s labour relations were subject to provincial jurisdiction, the Board issued certificates to the Labourers’ and the Operating Engineers.
Amec applied for judicial review of the Board’s decision in the Divisional Court.
The Divisional Court’s decision
On October 1, 2019, a majority of the Divisional Court dismissed Amec’s application for judicial review of the Board’s decision.
With respect to Amec’s primary argument regarding direct federal jurisdiction, the Divisional Court held that the language of section 71 of the NSCA required Amec to be “a work or undertaking that was constructed for the possession of nuclear waste”, which required an examination of Amec as a going concern. The Divisional Court held that this analysis demonstrated that Amec was not a work constructed for the purpose of possessing nuclear substances, nor was that its essential operation, and therefore it was not a work or undertaking covered by the declaration in section 71 of the NSCA.
The Divisional Court also rejected Amec’s first alternative argument regarding direct federal jurisdiction, holding that section 4 of the Canada Labour Code only applied if Amec was determined to be a federal work or undertaking, after applying the constitutional jurisprudence. In that regard, the Divisional Court held that the case was similar to Construction Montcalm Inc. v. Min. Wage Com.,  1 S.C.R. 754 and R. v. EllisDon Corporation Ltd., 2008 ONCA 789 in that Amec was “large construction and consulting business, carrying out operations throughout Ontario and in other jurisdictions around the world”; “[t]he work it was performing at Port Granby was a one-time contract for construction and demolition work”; Amec acted in accordance with the contractual specifications of the license holder, CNL; Amec had a mere contractual relationship with CNL; and its operations were not functionally integrated with those of CNL.
In concluding that Amec was not subject to direct federal jurisdiction, the Divisional Court quoted from the Board’s decision with approval:
In sum, I agree with the Board’s conclusion at para. 126 of its reasons:
In the end I find that this is the fairer and more accurate characterization of the role of Amec and what it is doing at Port Granby. Amec itself, the undertaking we are examining here, is not part of the nuclear industry subject to federal regulation and not part of the declaration in section 71 of the NSCA. It is a large construction company building a project (to the extent that the words project or facility themselves do not inherently overstate essentially excavating buried contaminated soil, transporting it to a newly built cell, burying and leaving it there, and returning the landscape to either what it looked like before or to make it fit into the surrounding environment), which when completed it will turn over to its owners (the federal government) and depart.
The Divisional Court also dismissed Amec’s further alternative argument that it was vital, essential or integral to the federal undertaking, holding that “[c]onsidering its activities on an ongoing basis, as one is required to do by the jurisprudence, Amec is not an essential part of the nuclear waste management operations of the federally regulated undertaking, CNL.”
Update: Ontario Court of Appeal denies leave to appeal
Amec sought leave to appeal to the Ontario Court of Appeal. The Court of Appeal denied the request for leave to appeal on January 10, 2020.