Here’s Why Ontario’s Back-to-Work Legislation May Be Unconstitutional

Last week, the government of Ontario forced 12,000 public college professors, instructors, librarians, and counsellors to end their strike and return to work. While many students breathed a sign of relief, the government’s back-to-work-legislation was not welcomed by the workers, who had voted 86% in favour of continuing the strike just days before.

Now, the Ontario Public Service Employees Union has launched a legal challenge against Bill 178, arguing the law violates their constitutional rights.

Are they right? Is Ontario’s back-to-work legislation unconstitutional?

Here’s why the law could be in their favour.

Why Back-to-Work Legislation May Be Unconstitutional

Section 2(d) of the Canadian Charter of Rights and Freedoms protects the right of freedom of association. This right has been interpreted to include the right of workers to form a union and conduct meaningful collective bargaining with their employers.

The Supreme Court’s decision in Saskatchewan Federation of Labour v. Saskatchewan states that striking is protected so long as it contributes to the meaningful process of collective bargaining. So while the freedom of association doesn’t necessarily guarantee a freedom to strike in every circumstance, it protects the strike as a productive means of collective bargaining.

Of course, like all our constitutional rights, the freedom of association is subject to reasonable limitations, and the government can limit the freedom of association if that limitation can pass the scrutiny of the Oakes test. That means back-to-work legislation can be constitutional.

The test for whether back-to-work legislation interferes with freedom of association is whether it law amounts to substantial interference with collective bargaining. Substantial interference means it disrupts the balance between employees and employers that freedom of association seeks to achieve.

Harper’s Back-to-Work Legislation Failed. Will Wynne’s Pass the Test?

A good illustration of this test is the case of Canadian Union of Postal Workers v. Her Majesty in Right of Canada, which concerned the Harper government’s back-to-work legislation against Canada Post workers.

Among other things, the workers in that strike sought a wage increase from their employer (Canada Post/the Canadian government). Harper’s strike-breaking law imposed a wage increase on the workers, but the increase was lower than what Canada Post had initially offered. The other issues up for debate were sent to an arbitrator, who was given the authority to impose a decision on both parties.

That didn’t fly with the court. A judge of the Federal Court found that the legislation violated the postal workers’ freedom of association and freedom of expression, and that it did not pass the Oakes test for a reasonable limitation.

Why?

The law hit the mark for the first part of the test. The government’s objective with the law, which was to prevent postal service disruption to protect Canada Post and the wider economy, was pressing, substantial, and rationally connected to the legislation. In other words, the law addressed an urgent and significant issue in a way that would actually resolve it.

Where the law failed was in the second part of the test: minimal impairment. When a law limits people’s rights and freedoms, it has to do so with a light touch – there must be no more impairment than is absolutely necessary. That was not the case with Harper’s back-to-work legislation. Since it took the matter of wages entirely off the table, and paid no heed to the postal workers’ position, it substantially interfered with the right to collectively bargain.

This is where the Wynne government’s back-to-work legislation could fail as well.

Hours before the Liberals announced the bill, the OPSEU workers voted to reject the employer’s offer and continue the strike by an overwhelming 86% majority. The government’s decision to step in that this point severely undercut that vote, essentially giving the employer an ‘out’ to ignore the vote instead of responding to it with a new offer.

It could certainly be argued that this tipped the scales in favour of the employer and interfered with the OPSEU’s collective bargaining.

 

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Does the Legal Profession have a Civility Problem?

Last week, the Supreme Court of Canada heard arguments in Joseph Peter Paul Groia v. Law Society of Upper Canada, a case that hits close to home for lawyers and paralegals in Ontario. The matter concerns a licensee’s professional duties, specifically the duty of civility.

Civility is enshrined in both the Paralegal Rules of Conduct and the lawyer Rules of Professional conduct. The latter reads,

“A lawyer shall be courteous, civil, and act in good faith to the tribunal and with all persons with whom the lawyer has dealings in the course of litigation.”

Civility is important for a few reasons. Next to police officers, lawyers and paralegals are the public’s main point of contact with the administration of justice; a lawyer or paralegal’s behaviour can positively or negatively impact the public’s perception of their courts, judges, and the law in general. Maintaining public confidence in justice is important in a democratic society.

But civility goes beyond what the public sees. In the courtroom, courtesy and cooperation can help to facilitate a smooth and speedy resolution to the matter. Uncivil behaviour can do the opposite. In this way, civility can impact the client’s ability to get their best shake at justice.

Few people argue that civility isn’t important at all, or that the Law Society should have no say in regulating it. The point of contention is where the Law Society’s authority begins and ends when it comes to enforcing the civility rule.

Namely, does it extend into the courtroom itself?

The Law Society certainly believes so. The commentary under the rule even states,

“Legal contempt of court and the professional obligation outlined here are not identical, and a consistent pattern of rude, provocative, or disruptive conduct by the lawyer, even though unpunished as contempt, might well merit discipline.”

The problem, some argue, is that policing civility in the courtroom puts advocates, especially in criminal defence, into an awkward position. They have a duty to defend represent their clients resolutely, but also to maintain courtesy.

The trial process is adversarial by nature, and it can lead to emotionally heated exchanges – especially if one feels the circumstances call for a direct, less-than-civil response.

That’s the position the plaintiff, Joseph Groia, claims he was in. He represented Bre-X mining chairman John Felderhof in a multi-million dollar fraud trial that went on for years. He sparred with the prosecution at several points, believing the Crown was trying to deny his client a fair trial. In this, he employed sarcasm and colourful language, at one time saying the Crown’s case had more holes than a lobster trap.

Judges in the case noted Groia’s behaviour, and threw him some pointed language in their decisions. The Crown attracted some derision for their behaviour as well.  It was a tense and grueling trial, but in the end, Groia succeeded in defending his client, and he was not held in contempt for his actions.

But the Law Society took notice, considering his “zealous advocacy” (an often-repeated phrase in this discussion) to have crossed the line into incivility. Groia has been fighting this determination ever since. Interestingly, he was also elected as a Law Society bencher, showing his significant support within the legal community.

How will the Supreme Court decide? What impact will it have on the legal community, especially criminal defence lawyers and paralegals? We won’t know for a few weeks yet, but licensees are watching with great interest, especially in Ontario. The Supreme Court was packed on the day of the hearing, with hundreds more spectating online.

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Should Ontario Charities Provide Legal Services?

The legal profession, like the law itself, is slow to change. However, facing growing economic pressure and competition, lawyers and paralegals have had to look for new ways to keep themselves afloat. After all, law isn’t just a calling – it’s a business.

At the same time, the Law Society and the profession as a whole has increasingly turned an ear to the plights of people who cannot access the legal services they need. The traditional ways of delivering legal services fall short when it comes to access to justice.

These two issues have put pressure on the Law Society to open up new avenues for lawyers and paralegals to deliver their services to the public.

Permitted Business Structures for Lawyers and Paralegals in Ontario

Right now, licensees are fairly limited in how they can provide services. They can practice or provide services as sole proprietors, in a general partnership, a limited liability partnership (a structure also available to professionals like dentists, doctors, etc.), or a professional corporation.

They can also enlist the services of other professionals, like accountants, and deliver blended services in a multi-discipline practice or affiliate relationship.

For the most part, these restrictions are understandable. It’s important that lawyers and paralegals can’t hide behind a corporation to avoid consequences. Multi-discipline practices make a lot of sense in certain areas of law. The partnership arrangement is well ingrained in the legal profession, with the classic steps of a successful legal career still being student > associate > partner for many people.

There are a lot of limitations that restrict how legal professionals do business – how to take on clients, how to manage finances, who can be a part of the business,. Again, there are good reasons for this. The rules help to protect the public and set good business practices. The Law Society’s mandate is to regulate the profession in the interests of the public, not in the interests of licensees making money.

But at a time where fewer people can afford legal services, and more licensees are having trouble making a living, people are looking for new ways to do business.

Alternative Business Structures

The Law Society has been looking into the idea of allowing new forms of business for some time now. It formed a working group way back in 2012, which released its first discussion paper in 2014 and a further report in 2015.

The working group studied the potential for new business forms to speed innovation in the slow-moving profession and enhance access to justice. Some of the ideas tossed around were allowing non-licensees to have an ownership stake in firms, franchise arrangements, and the delivery of legal services by civil organizations like charities.

Providing Legal Services Through a Charity

In the end, it’s the latter idea that’s made the most headway. In September 2017 Convocation, the Law Society benchers voted to approve, in principle, a policy to allow lawyers and paralegals to provide legal services through charities and non-profits. The main points:

  1. This new form of regulation would not include organizations funded by Legal Aid Ontario.
  2. It won’t impact the existing provision of legal services.
  3. The regulations would cover services provided at no cost to the client.
  4. The charities will not be allowed to refer clients to lawyers or paralegals in exchange for donations, payments, or other forms of consideration.

This could open up new avenues that could benefits licensees and the public both. Charities focused on social justice issues could have staff lawyers and paralegals that provide services through the charity itself, rather than on a referral basis.

The idea has promise, but at this point, it’s still just that – an idea. The Law Society hasn’t taken concrete steps to implement this.

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Law Society to Debate Controversial Equality Oath in December

Ontario paralegals and lawyers are in heated debates over the merits of a new requirement by the Law Society to adopt a “statement of principles” acknowledging an obligation to promote equality, diversity, and inclusion.

Last December, the Law Society benchers voted unanimously to adopt 13 recommendations by a committee called the Challenges Facing Racialized Licensees Working Group, which spend four years studying the impact of systemic discrimination on non-white lawyers and paralegals. Among those recommendations was the statement of principles.

By the end of 2017, all lawyers and paralegals in Ontario must create and agree to abide by an individual statement of principles, “that acknowledges obligation to promote equality, diversity and includion generally, and in your behaviour towards colleagues, employees, clients and the public.” There is no need to post the statement anywhere or send it to the Law Society; they simply need to report that they have fulfilled the requirement.

The Law Society has provided two template statements licensees can use, or they can create a new statement from scratch. There are no real requirements for how the statement should look, asides from, “a preamble explaining the grounds for and intentions of the statement, and a set of principles adopted to help achieve these objectives.”

It sounds simple, but the idea of a mandatory statement of principles has generated a lot of discussion and attracted some criticism. Some licensees have even made clear their intention to ignore the requirement.

Arguments Against the Statement of Principles

While there was some buzz about this new obligation when it was voted on last year, it has only recently come into mainstream focus. This is likely because of the approaching deadline (December 31) for licensees to put a statement in place.

Supporters of the requirement have called the critics a vocal minority, but it’s tough to gauge just how many lawyers and paralegals are engaged in the issue.

Many of the arguments against the statement of principles centre around the Canadian Charter of Rights and Freedoms. Leonid Sirota of the Double Aspect Blog calls it a “totalitarian values test” that infringes on the freedom of speech and freedom of conscience. He also points out that the current lawyer rules of conduct don’t create an explicit obligation to promote diversity, equality and inclusion – only to uphold human rights laws and other rules related to equality. The same goes for the paralegal rules of conduct.

Law Society Bencher Joseph Groia has asked convocation to reconsider the requirement. He filed a motion last week requesting that conscientious objectors like himself be exempt from the requirement. It will be heard at the December convocation meeting, and it’s sure to be a lively one.

Arguments For the Statement of Principles

While there have been may voices in opposition to the statement of principles, some have come out to speak out in support. Jennifer Quinto argues in the Law News Times that it would not constitute a charter violation, and if it did, it would be saved as a justifiable infringement under s.1. In her words, “Requiring lawyers to confirm their human rights obligations is not deleterious, and in any event, it would be far outweighed by the salutary effects.”

Quinto herself served as part of the committee which recommended the statement of principles. She points out the urgency of addressing systemic discrimination in the legal profession, as lawyers and paralegals are meant to be the ones defending the values of equality, diversity and inclusion in our society.

The issue will be formally discussed at the December convocation, but for now, it remains a requirement for all lawyers and paralegals in Ontario.

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Why Canada Doesn’t Need a Law Against Stealing Firefighting Equipment

Legislative change often comes in response to current events. This is a normal part our of democratic process, and the common law is designed to evolve as the world changes around it.

However, when the news of the day is particularly heart-wrenching, it can sometimes lead to some less-than-logical proposals in the House.

Such is the case with Bill C-365, a private member’s bill introduced by Conservative MP Mel Arnold.

The bill is short and straightforward. As the name implies, An Act to amend the Criminal Code (firefighting equipment) means to add a new criminal offence, along with sentencing guidelines. This, I like – bills are too often too long, and are given deceptive and overly political names that attempt to twist their true purpose. Unfortunately, that’s where my love for Bill C-365 ends.

The bill means to criminalize the theft of firefighting equipment that causes an actual danger to life. As Arnold stated in the House of Commons,

“This summer I was shocked to hear reports of firefighting equipment being stolen and vandalized during the worst wildfire season in British Columbia’s written history. After researching the Criminal Code, it was apparent that there was a gap when it comes to the denunciation and deterrence of theft or damage to firefighting equipment.”

His research must not have been thorough, however, because the denunciation and deterrence of such acts are pretty well covered in the code already.

Theft is a crime. Depending on whether the value of the stolen property exceeds $5,000, it may be either a summary conviction offence or an indictable offence.

Additionally, it is a crime to willfully destroy or damage property, or to obstruct, interrupt, or interfere with the lawful use or operation of property. You’ll find this in section 430, which deals with mischief. According to s.430(2), anyone who commits mischief that causes actual danger to life is guilty of an indictable offence and liable to life imprisonment.

A person accused of stealing firefighting equipment can be charged with theft (presumably the indictable version). If their unlawful act lead to peoples’ lives being endangered, as was the case with the British Columbia wildfires, they could also be charged under s.430(2) for life-endangering mischief.

Stealing firefighting equipment is already quite illegal, and the consequences are already greater if that theft threatens someone’s life.

The last part of Bill C-365 deals with denunciation and deterrence, stating that acts involving firefighting equipment should be taken by the judge as an aggravating factor when determining the sentence for someone found guilty of the above offences.

However, this is also unnecessary, as judges already have the discretion to consider such circumstances in sentencing. That’s how the system works: we have faith in our adjudicators to make sound judgement in these matters.

If there were suddenly a spate of firefighting equipment thefts, and judges were for some reason letting those offenders off easy, this new legislation might serve some purpose. But as of this point, it only really exists to score political points.

The problem with legislation like this is that the Criminal Code is already a long, confusing document. Tacking on additional sections that pointlessly retread old ground only makes the problem. What we should be doing is making the Code more compact by removing outdated and unconstitutional provisions, not stuffing it with overly specific laws about stealing this or that.

Of course, the noble purpose behind the bill makes it hard to oppose. After all, what monster would support firefighting equipment thieves? And in the end, I think that’s the point behind the whole thing.

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The Law Society of Upper Canada is Getting a New Name

Canada’s oldest law society is getting a name change.

On Thursday, September 28, the Law Society of Upper Canada voted 33 to 11 in favour of  a motion to discard “Upper Canada” from its name at its first fall Convocation meeting. The organization has not yet decided on a replacement name.

Why Change the LSUC’s Name?

The name of Ontario’s regulatory body for lawyers and paralegals has been a contentious subject for some time now. Efforts to change the name originated at Convocation all the way back in 1993; since then, the debate has re-emerged every few years, with support growing in favour of those who wish to adopt a new name.

Though the tide has shifted towards change, the issue is far from settled among the province’s legal community, and nearly a quarter of the Law Society’s benchers (most of whom were elected by lawyers and paralegals) voted against the motion.

Why change the LSUC’s name? On the surface, the issue seems fairly straightforward. The name originates in a time when the “Upper Canada” designation was relevant; it has not been so for several hundred years. It’s likely many Ontarians have never heard of Upper Canada, let alone could explain what it is.

It’s old-fashioned, to say the least. But it goes deeper than that.

The Law Society is mandated to regulate the lawyer and paralegal professions in the public interest. Many in support of the name change have rightly pointed out the organizations name as an obstacle to carrying out that mandate.

After all, how can we expect people to understand what the Law Society of Upper Canada does if they have no idea what (or where) Upper Canada is?

If the organization adopted a more relevant name (like the oft-suggested “Law Society of Ontario”), the public would at least know the province in which it operates. That’s the hope, at least.

But it’s up for debate whether that sort of change would really solve the problem. One bencher pointed out that the term “Law Society” is obtuse as well.

In this context, “society” is basically a synonym for “group” – the word doesn’t connote the fact that the organization is responsible for licensing, regulating, and disciplining lawyers and paralegals in the province. Someone who isn’t familiar with the legal profession could think it’s a group that advocates on behalf of lawyers or paralegals, or that it’s a voluntary group like the Ontario Bar Association or a Law Association.

This bencher also suggested a name along the lines of, “Regulatory Authority of Ontario Lawyers and Paralegals.” RAOLP has a nice ring to it, no?

Reconciliation

Aside from the Law Society’s mandate towards the public, it’s important to note another prominent aspect of the debate: colonialism.

Many benchers pointed out the association between Upper Canada and colonization. The name harkens back to a dark time in Canadian history, evoking violence towards and oppression of the country’s Indigenous peoples. The Law Society itself was not innocent in this regard, with an admissions process that was (and still is, to an extent) discriminatory and Anglo-centric.

It was thought by many that the Law Society could help shed its colonial past by adopting a more contemporary name. However, this is also up for debate. One bencher argued that changing the name for the purpose of reconciliation ignores the ongoing struggles of Ontario’s Indigenous communities, in addition to the colonial connotations of the name ‘Ontario.’

The Law Society of Upper Canada will continue to operate under its own moniker until a new name is chosen in November. Whether it ends up being the OLS, the LSO, or the RAOLP, the new name is sure to be controversial.

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How Does Income Sprinkling Work?

Earlier this summer, the federal government announced plans to change Canada’s tax laws to remove the practice known as ‘income sprinkling’, which lets people lower their income tax burden by distributing money among family members.

With Parliament out on vacation for the season, this issue didn’t boil over until recently. And boil over it did. From the moment the House re-opened its doors, there has been a nonstop flurry of outrage on the issues from both sides of the political aisle, including infighting within Prime Minister Trudeau’s own party.

As an avid CBC radio listener, I’ve been disappointed to hear little in the way of bipartisan discussion on these proposed tax changes. They’ve featured a cavalcade of sympathetic, well-spoken characters explaining why various classes of working people shouldn’t have to pay their full income tax obligation — doctors, dentists, lawyers, farmers.

Unfortunately, what we haven’t heard is the hundreds of professionals who support ending the practice. Nor has there been much talk of what exactly income sprinkling is. While I wouldn’t accuse the CBC of being on board with the CPC, I’d like to see a more in-depth discussion on this issue before consultations end on October 2nd.

In the meantime, I’ll offer my own take.

What is Income Sprinkling?

Before this fall, the vast majority of people would’ve pictured a donut if you asked them about income sprinkling. And to be fair, it is quite the treat if you have the means to grab it.

As is often the case, income sprinkling is not actually a ‘loophole’. It has been recognized and encouraged for years as a legal way for high-earning Canadians to pocket more of their income.

The basic idea is this: someone with a high income creates a corporation and employs their lower-income family members as ‘workers’ in the corporation. The high earner then uses their own income to pay their ‘workers’ a ‘wage.’

The ‘workers’, who may or may not perform any work on behalf of the corporation, pay taxes on their earnings at the lower tax bracket. Then, in one way or another, the high income earner reaps the benefits of that money without having had to pay higher income taxes on it.

Example of Income Sprinkling

Here’s an example of how this might work.

Nice Guy owns a corporation. He’s paying for his adult daughter’s university education. He’s going to use this arrangement to avoid paying income tax.

As the sole owner, Nice Guy could reap the corporation’s $220,000 profit in full. But instead, he employs his adult daughter as a worker in the corporation, paying her an annual salary of $45,000.

His daughter then uses that income to pay for her tuition, rent, and living expenses — which are all things nice guy would’ve been paying for anyhow.

If Nice Guy had taken home the full $220,000 himself, he would’ve landed in the highest tax bracket and handed 33% of that amount to the government. That’s $73,260 in income tax. Instead, his income is $175,000, and he pays at a lower tax rate of 29%, or $57,750.

His daughter, meanwhile, sits in the lowest tax bracket and pays just 15% ($6,750) on the $45,000.

Assuming Nice Guy would’ve had to pay the $45,000 regardless (since he’s paying for his kid’s education, being the Nice Guy he is), he saves $10,760 in income tax by sprinkling some of his income to his daughter.

And he can go further than that. He can also sprinkle some to his wife, who can use that money to buy groceries and pay other living expenses for both of them. He could throw some his son’s way, say $10,000, and have the son re-pay it to him in the form of rent.

Either way, he saves even more on income tax! Great, isn’t it?

Well, for those who have the time and money to incorporate (not to mention the knowledge to take advantage of this scheme), it is nice. But that’s not something most Canadians are capable of doing. Thus the characterization as a loophole for the wealthiest people.

Lawyers and doctors are two of the biggest groups speaking out in defence of income sprinkling, since many are business owners themselves and are accustomed to reaping the benefits of this trick.

The primary argument I’ve heard in favour is that these professionals often spend a lot of their own money to keep their businesses running, and that their non-working family members help them out. Thus, they claim it’s fair to use these people to dodge taxes.

While they’re probably right, the same argument could be made for a lot of Canadians in lower tax brackets as well. We all lean on our families for support; we all spend our own money to buy things for work sometimes.

And the rest of us pay our share of income tax, as we all ought to.

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Will TTC’s Drug Testing Policy Stand Up in Court?

Last month, the TTC suspended a driver for failing a random drug test. 300 employees have been tested since May.

It’s been three months since the Toronto Transit Commission (TTC) began administering random drug and alcohol tests on its employees. More than 300 employees have undergone the test in that time — eight have tested positive. Last month, the TTC suspended the first driver to fail a test, but disclosed neither the employee’s name nor the substance that tripped the test.

The TTC’s random drug testing policy has been controversial at every step. It was first proposed back in 2011, following an incident where a TTC bus driver rear-ended a truck. A passenger died in the accident, and police found marijuana on the driver’s person.

The driver refused to take a drug test, but the implication was clear. In the eyes of the public, drug use was the cause of the accident. Amid the uproar, the TTC responded with a widespread random drug and alcohol testing policy.

But not everyone supports this. The union representing thousands of employees, for one, was opposed from the start. The issue has been in the hands of an arbitrator since 2011.

The first major development in the case came in April 2017, when the Ontario Superior Court rejected the union’s application for an interlocutory injunction, which would have stopped the TTC from moving forward with the policy.

Many outlets reported this as the court’s approval of the policy. In fact, the court only approved of the TTC implementing the policy while the case is being litigated. It did not approve nor disapprove of the actual substance of the policy.

That’s for the arbitrator to decide. But don’t be surprised if it winds up in front of the court of appeal afterwards.

Random drug and alcohol testing is a thorny subject in Canada. Unlike many American states, Canadian courts have put very strict limits on when and how employers can test their employees. Testing is considered a significant affront to the dignity and privacy of employees, and addiction is viewed as a disability in the eyes of the law.

Two leading cases in this area are Stewart v. Elk Valley Coal Corporation and Communications, Energy and Paperworkers Union of Canada, Local 30 v. Irving Pulp & Paper, Ltd. In the Irving Pulp case, the company began testing 10% of its employees in safety-sensitive positions over the course of a year. A positive test would attract serious disciplinary action, including dismissal. The Supreme Court of Canada ruled against the employer, stating that an employer cannot unilaterally impose a mandatory random testing program unless it can prove it’s necessary, such as evidence of a general problem with substance abuse in the workplace. Simply having a dangerous workplace is not justification alone for such a policy.

The Elk Valley Coal case is more recent, and confirms that employees can test employees in some circumstances. The employer in that case had a policy where any employee who was involved in an accident while under the influence of drugs or alcohol would be dismissed. However, if an employee felt they had an addiction issue, they were free to disclose it to the employer before an accident occurred and could get help without fear of reprisal. The court upheld this policy.

It’s not clear where the TTC’s policy fits into the law. On one hand, safety is a significant concern among its workforce, as they are responsible for the safety of millions of people, and their workplace spans the entire city of Toronto.

But can the commission prove the policy is necessary? There was the incident in 2011, but that was never conclusively proven to be the result of drug use, and a single incident may not justify infringing on employees’ privacy.

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