T-1390-96
OTTAWA, ONTARIO, the 2nd day of October, 1997
| PRESENT: THE HONOURABLE MR. JUSTICE PINARD |
| In the matter of an application for judicial review filed pursuant to section 18.1 of the Federal Court Act; |
| And in the matter of a decision rendered on an appeal pursuant to subsection 251.11(1) of the Canada Labour Code, R.S.C. 1985, c. L-2 by the respondent Autocar Connaisseur Inc. |
BETWEEN :
The Attorney General of Canada,
Applicant
- and -
Autocar Connaisseur Inc.,
Respondent
- and -
Michel Guérin,
Mis en cause
- and -
Denis Germain Simard, in his capacity as a referee
appointed under subsection 251.12(1)
of the Canada Labour Code,
Mis en cause
O R D E R
The application for judicial review is allowed, the referee"s decision of May 8, 1996 is rescinded, and the matter is returned to a referee who shall be appointed in accordance with subsection 251.12(1) of the Canada Labour Code .
| YVON PINARD |
| J. |
Certified true translation
Christiane Delon
T-1390-96
| In the matter of an application for judicial review filed pursuant to section 18.1 of the Federal Court Act; |
| And in the matter of a decision rendered on an appeal pursuant to subsection 251.11(1) of the Canada Labour Code, R.S.C. 1985, c. L-2 by the respondent Autocar Connaisseur Inc. |
BETWEEN :
The Attorney General of Canada,
Applicant
- and -
Autocar Connaisseur Inc.,
Respondent
- and -
Michel Guérin,
Mis en cause
- and -
Denis Germain Simard, in his capacity as a referee
appointed under subsection 251.12(1)
of the Canada Labour Code,
Mis en cause
REASONS FOR ORDER
PINARD J.
This is an application for judicial review of the decision rendered on May 8, 1996 by a referee appointed pursuant to subsection 251.12(1)1 of the Canada Labour Code, R.S.C. 1985, c. L-2 (the Code).
* * *
Michel Guérin (the employee) was employed by the respondent, Autocar Connaisseur Inc. (the employer) for ten months, from June 2, 1993 to April 4, 1994, as a night dispatcher at Mirabel International Airport. The employee"s shift ran from 7:00 p.m. to 7:00 a.m., 12 hours a day. He usually worked five days a week, for a total of 60 hours; occasionally, he worked six days a week, a total of 72 hours. The employee was not remunerated on a strictly hourly basis, receiving the equivalent of $270 (towards the end, $300) for a five-day week comprising 60 hours of work. The employee was in addition paid a commission of 5% of his gross ticket sales each week.
On June 22, 1995, the employee filed a complaint with Labour Canada essentially alleging the following:
| [Translation] During the 10 months I was employed by Autocar Connaisseur inc., I was not paid for any overtime or holidays for the work I did. I would like an investigation to be conducted in this regard and proceedings on my behalf to be undertaken (if necessary) at the earliest possible opportunity. |
After investigating this complaint, the inspector Mario Desrosiers, appointed pursuant to subsection 249(1)2 of the Code, ordered the employer on August 30, 1995 to remit to the Receiver General of Canada $3,454.91 less the authorized deductions under section 254.1 of the Code, as provided under subsection 251.1(1)3 of the Code. The inspector explained that
| [Translation] This amount represents the sums unpaid in regard to the requirements of Part III of the Canada Labour Code. The claim dated June 22, 1995 provides the particulars of the computations that have been made. (Appendix A) |
On September 7, 1995, the employer appealed this decision to Labour Canada pursuant to subsection 251.11(1)4 of the Code. At the same time, the employer forwarded to the Receiver General of Canada a certified cheque in the amount of $3,454.91 corresponding to the payment order, pursuant to subsection 251.11(2)5 of the Code. It is worth reproducing this notice of appeal:
| [Translation] |
| Letterhead: Autocar Connaisseur inc. |
| NOTICE OF APPEAL |
| In accordance with the provisions of section 251.11 of the Canada Labour Code, Autocar Connaisseur inc. wishes to appeal the decision of the inspector Mr. Mario Desrosiers of Human Resources Development Canada, Labour Branch, rendered on August 30, 1995, in which a payment order for $3,454.91 was conveyed to the appellant. This payment order is incorrect in that the inspector was in breach of the provisions of subsection 178(1)(b) of the Canada Labour Code, since the employee, Mr. Michel Guérin was never paid on an hourly basis. |
| In accordance with the provisions of the aforementioned section, the employer is delivering to the Minister of Labour a certified cheque payable to the Receiver General of Canada in the amount indicated in the payment order, $3,454.91, and is including as well a record of authorized deductions under section 254.1 of the Code. This notice of appeal is being sent to the Minister of Labour pursuant to the provisions of the Canada Labour Code. |
| IN WITNESS WHEREOF we have signed, in Montréal, on the 7th day of September, 1995. |
| (signature) |
| Lorenzo Calce |
| President |
The referee appointed by the Minister of Labour heard this appeal on January 12, 1996. In his decision, dated May 8, 1996, the referee, relying on subsection 251.12(4)6 of the Code, declared the payment order invalid and directed payment to the employer of the money held in trust by the Receiver General within 30 days of his decision. It is worth reproducing the "Decision and Reasons" section of this award, which is the subject of this application for judicial review:
| [Translation] |
| The evidence indicates the absence of any specific guideline that would be useful to the proper understanding of section 178.1(b) [sic] of the Canada Labour Code. It is not the purpose of this decision to remedy this shortcoming within the Department of Human Resources Development Canada. |
| This case indicates that the purpose of section 178 et seq. is to determine the minimum salary payable to employees aged 17 and over and to establish that when an employee is not paid on an hourly basis, the employee ought to receive the equivalent of this rate in terms of the time worked. The minimum for an employee whose compensation is not "hourly" is the minimum under section 178.1(b) [sic ], which is the equivalent of section 178.1(a) [sic]. |
| After a detailed analysis of the file, I conclude that the appellant complied with the letter and the spirit of the Canada Labour Code and it is not the referee"s job to propose one or more statutory amendments that would contribute to the practical understanding of that Code. |
| A referee appointed under subsection 251.12(1) of the Canada Labour Code must hear and determine the appeal in regard to the payment order that was issued earlier. |
| Under subsection 251.12(4) of the Canada Labour Code, the referee has the power to decide the validity of the payment order: |
| Referee's decision ... The referee may make any order that is necessary to give effect to the referee's decision and, without limiting the generality of the foregoing, the referee may, by order,... |
| confirm, rescind or vary, in whole or in part, the payment order or the notice of unfounded complaint;... |
| For all of the reasons referred to above; |
| I declare the payment order invalid. ... |
| [Emphasis in the original] |
* * *
It must first be determined whether the referee"s decision is reviewable, in view of the full privative clause set out in subsections 251.12(6) and (7) of the code, which read as follows:
| 251.12 (6) The referee's order is final and shall not be questioned or reviewed in any court. |
| (7) No order shall be made, process entered or proceeding taken in any court, whether by way of injunction, certiorari, prohibition, quo warranto or otherwise, to question, review, prohibit or restrain a referee in any proceedings of the referee under this section. |
In Canada Post Corporation v. Pollard, [1994] 1 F.C. 652, at pages 663 to 666, Décary J.A., for the Federal Court of Appeal, reviewed the applicable case law on judicial review of a decision protected by a privative clause:
| There has been such an avalanche of decisions dealing with the appropriate standard of judicial review since the landmark decision of the Supreme Court of Canada in U.E.S., Local 298 v. Bibeault...that it is easy to lose sight of what Bibeault basically stands for. The subsequent application to particular cases of the "functional and pragmatic approach" suggested by Beetz J. in Bibeault should not distract us from the essential teaching of that decision, i.e. that at the very beginning of the judicial review process there is but one question the Court should ask itself: whether the legislator intended, expressly or by implication, the question to be within the jurisdiction conferred on the tribunal.... |
| At this early stage, I hasten to add, no curial deference to the tribunal is to be shown, for the courts are eminently well suited for determining whether a tribunal has exceeded the jurisdiction which is granted to it by its enabling statute (PSAC (1993), at page 963, Cory J.). |
| When the answer to the question is that the legislator did not intend the question to be within the jurisdiction conferred on the tribunal, the tribunal will still have the jurisdiction to answer the question, but a mere error in the interpretation of the provision will constitute what has been referred to as a jurisdictional error and cause the tribunal to lose jurisdiction, even in the face of a privative clause (Université du Québec, at page 494, L'Heureux-Dubé J.). The test is that of correctness. |
| When the answer to the question is that the legislator did intend the question to be within the jurisdiction conferred on the tribunal, the tribunal will be deemed to have acted within its jurisdiction in interpreting the provision and the court, even in the face of a privative clause...will not intervene unless the tribunal has erred in a patently unreasonable manner (Bibeault, at page 1086, Beetz J.; Paccar, at page 1003, La Forest J.; PSAC (1993), at page 962, Cory J.). The patently unreasonable test is a severe one (Paccar, at page 1003, La Forest J.), a very strict one (PSAC (1993), at page 964, Cory J.). It sets a high standard of review: it is not enough that the decision of the tribunal is wrong in the eyes of the court; it must, in order to be patently unreasonable, be found by the court to be clearly irrational, that is to say evidently not in accordance with reason (PSAC (1993), at page 963, Cory J.; Domtar, at page 775, L'Heureux-Dubé J.) or not sustainable on any reasonable interpretation of the facts or of the law (National Corn Growers Assn., at page 1369, Gonthier J.). The severity of the test requires the courts to adopt a posture of deference to the decision of the tribunal (Paccar, at pages 1003-1004, La Forest J.). Deference is particularly suited in labour disputes (Bibeault, at page 1089, Beetz J; Paccar, at pages 1004-1005, La Forest J.), although the degree of deference will vary depending on whether the tribunal falls towards the lower or the upper end of the spectrum of those administrative tribunals charged with policy deliberations to which the courts should defer (Dayco, at page 266, La Forest J.; Mossop, at page 585, La Forest; Bradco, at pages 336-337, Sopinka J.). |
Applying these principles to the case at bar, the referee"s jurisdiction not being at issue, we need only determine whether the referee committed a patently unreasonable error. In doing so, we should consider in particular the following relevant provisions of the Code and the Canada Labour Standards Regulations , C.R.C. 1978, c. 986 (the Regulations):
| Canada Labour Code |
| 169. (1) Except as otherwise provided by or under this Division |
| (a) the standard hours of work of an employee shall not exceed eight hours in a day and forty hours in a week; and |
| (b) no employer shall cause or permit an employee to work longer hours than eight hours in any day or forty hours in any week. |
| 171. (1) An employee may be employed in excess of the standard hours of work but, subject to sections 172, 176 and 177, and to any regulations made pursuant to section 175, the total hours that may be worked by any employee in any week shall not exceed forty-eight hours in a week or such fewer total number of hours as may be prescribed by the regulations as maximum working hours in the industrial establishment in or in connection with the operation of which the employee is employed. |
| 174. When an employee is required or permitted to work in excess of the standard hours of work, the employee shall, subject to any regulations made pursuant to section 175, be paid for the overtime at a rate of wages not less than one and one-half times his regular rate of wages. |
| 178. (1) Except as otherwise provided by or under this Division, an employer shall pay to each employee of the age of seventeen years and over a wage at the rate of |
| (a) not less than four dollars an hour; or |
| (b) where the wages of the employee are paid on any basis of time other than hourly, not less than the equivalent of the rate under paragraph (a) for the time worked by the employee. |
| Canada Labour Standards Regulations |
| Determination of Hourly Rate of Wages |
| 20. (1) Subject to subsections (2) and (3), for the purposes of calculating and determining the regular hourly rate of wages of employees who are paid on any basis of time other than hourly, an employer shall divide the wages paid for work performed by the number of hours required to perform the work. |
I should point out that all of the above Code provisions are located in Part III, and were explicitly relied on first by the inspector, then by the referee; the first three are in Division I, entitled "Hours of Work", and the fourth is in Division II, entitled "Minimum Wages".
Paragraph 178(1)(b) of the Code simply and clearly sets out the minimum wage to be paid to an employee of the age of 17 years and over who is not paid on an hourly basis. The referee applied the provision as if, simply because an employee of the age of 17 or over is not paid on an hourly basis, the employer need pay him only this minimum wage, without taking into account the additional salary obligations of the employer resulting from the other applicable statutory and regulatory provisions such as section 174 of the Code and subsection 20(1) of the Regulations. Given this factual and statutory context, such a narrow determination of the employer"s salary obligations defies common sense. It seems obvious to me that the referee saw "a discrepancy" where one does not exist, and his misapplication of paragraph 178(1)(b) of the Code constitutes, in the circumstances, a patently unreasonable error of law which, to all intents and purposes, prevented him from deciding, in light of all the applicable statutory and regulatory provisions, the real question raised by the complaint at the origin of the case that was before him. Indeed, the question that the referee should have resolved was not whether the employee had received the minimum wage prescribed by subsection 178(1) of the Code, which was not at issue, but rather whether the employee was entitled to be paid for the work he performed on overtime and sometimes on statutory holidays, the answer to which was necessarily to be found elsewhere than in subsection 178(1) of the Code.
To allow the real issue to be considered and decided in accordance with these reasons, the referee"s decision of May 8, 1996 shall be rescinded and the matter shall be returned to a different referee who shall be appointed in accordance with subsection 251.12(1) of the Code.
OTTAWA, Ontario
October 2, 1997
| Yvon Pinard |
| J. |
Certified true translation
Christiane Delon
FEDERAL COURT OF CANADA
TRIAL DIVISION
NAMES OF COUNSEL AND SOLICITORS OF RECORD
| FILE NO. T-1390-96 |
| STYLE: Attorney General of Canada |
| v. Autocar Connaisseur Inc. et al. |
| PLACE OF HEARING: Montréal, Quebec |
| DATE OF HEARING: September 23, 1997 |
REASONS FOR JUDGMENT OF PINARD J.
| DATED: October 2, 1997 |
APPEARANCES:
| Raymond Piché for the applicant |
| Line Poirier for the respondent |
SOLICITORS OF RECORD:
| George Thomson for the applicant |
Deputy Attorney General of Canada
Ottawa, Ontario
| Guy & Gilbert for the respondent |
Montréal, Quebec
__________________1 251.12 (1) On receipt of an appeal, the Minister shall appoint any person that the Minister considers appropriate as a referee to hear and adjudicate on the appeal, and shall provide that person with(a) the payment order or the notice of unfounded complaint; and(b) the document that the appellant has submitted to the Minister under subsection 251.11(1).
2 249. (1) The Minister may designate any person as an inspector for the purposes of this Part.
3 251.1 (1) Where an inspector finds that an employer has not paid an employee wages or other amounts to which the employee is entitled under this Part, the inspector may issue a written payment order to the employer, or, subject to section 251.18, to a director of a corporation referred to in that section, ordering the employer or director to pay the amount in question, and the inspector shall send a copy of any such payment order to the employee at the employee's latest known address.
4 251.11 (1) A person who is affected by a payment order or a notice of unfounded complaint may appeal the inspector's decision to the Minister, in writing, within fifteen days after service of the order, the copy of the order, or the notice.
5 251.11 (2) An employer or a director of a corporation may not appeal from a payment order unless the employer or director pays to the Minister the amount indicated in the payment order, subject to, in the case of a director, the maximum amount of the director's liability under section 251.18.
6 251.12 (4) The referee may make any order that is necessary to give effect to the referee's decision and, without limiting the generality of the foregoing, the referee may, by order,
(a) confirm, rescind or vary, in whole or in part, the payment order or the notice of unfounded complaint;
(b) direct payment to any specified person of any money held in trust by the Receiver General that relates to the appeal; and
(c) award costs in the proceedings.