Divisional Court overturns Ontario Labour Relation Board’s certification of construction bargaining unit integral to telecommunications

Written by on August 29, 2018.

In a significant victory for employers engaged in construction work in federally-regulated sectors, the Divisional Court in Labourers’ International Union of North America, Ontario Provincial District Council v Ramkey Communications Inc [1]has overturned an Ontario Labour Relations Board (“OLRB”) decision suggesting that all contractors performing construction work were subject to provincial labour relations laws, regardless of how vital, essential, or integral that work was to the federal operation they serviced.

This landmark decision should be noted by all employers that operate a business vital or integral to a federal undertaking and should be particularly noted by employers and unions which carry on construction business in the telecommunications industry.

The Ramkey OLRB Decision

In Ramkey OLRB,[2] the Labourers’ International Union of North America (“LIUNA”) sought to be certified as the bargaining agent for Ramkey’s construction technicians pursuant to the construction industry provisions of Ontario’s Labour Relations Act, 1995. [3] Ramkey Communications Inc. (“Ramkey”) provided contractor services to various telecommunications companies, and primarily Rogers Communications Inc. (“Rogers”). Ramkey’s construction technicians were responsible for placing and connecting cable lines in situations where construction equipment may be necessary (i.e. where cable needed to be run under a sidewalk or street) and supporting existing telecommunications infrastructure, among other things. Ramkey argued that its construction techicians were essential to Rogers’ operations and, as such, that it should be federally regulated as well.

In making that argument, Ramkey relied on Supreme Court of Canada cases indicating that, where a business is “vital, essential or integral” to a federal undertaking, provincial labour relations law will not apply. Ramkey argued that its “normal and habitual activities” involved connecting and maintaining telecommunications networks, and that those activities were necessary for the networks to continue operating.

The OLRB disagreed, ruling that Ramkey was merely a subcontractor, not important to Rogers’ corporate operations, and that its work was essentially analogous to a construction contractor that was “in the business of building”.

As a result, the OLRB’s decision suggested that a company engaged in construction work can never be subject to derivative federal labour jurisdiction, even if its work is vital, essential or integral to a federal undertaking.

Ramkey OLRB Overturned: The Divisional Court’s Ramkey Decision

Ramkey applied to the Divisional Court to judicially review the OLRB’s decision and, on August 13, 2018, the Divisional Court granted Ramkey’s request and quashed the OLRB’s decison.

In reaching its decision, the Divisional Court rejected the OLRB’s findings that Ramkey’s construction work was not vital, essential, or integral to the operation of the telecommunications networks:

[52]           In Montcalm, the court held that “simply building a federal undertaking is not vital, integral to the operation of a federal undertaking.”  However, that case is different than the case before us as in Montcalm, there was a single construction project for a federally regulated company and the type of work done was not peculiar to the federally regulated industry.

[53]           In this case by contrast, the core of Ramkey’s work is to install and maintain the fibre optic telecommunications network in good working order for existing and prospective clients.  This work is highly integrated with that of Rogers and other telecommunications companies and has been so integrated for an extended period.  The type of work they do installing, maintaining and enhancing fibre optic cable, is integral to providing telecommunications and that work is operational (as it involves maintaining and enhancing the network on an ongoing basis not simply construction).

The Divisional Court agreed with Ramkey that “the issue is whether the work Ramkey does is integral to the federal undertaking in which the telecommunications company is engaged”.[4] The court went on to distinguish between the general construction of infrastructure and construction work, like Ramkey’s, that was specific to a federal undertaking:

[57]           In this case, the adjudicator of the OLRB held that the services rendered by Ramkey related to the construction of infrastructure not telecommunications operations and the services were therefore covered by provincial not federal legislation.

[58]           We disagree.  Ramkey’s construction work is specific to the telecommunications industry.  It was not general construction and was not a “one off” project but rather, part of an ongoing part of the telecommunications business.   As was the case in Northern Telecom #2 at pp. 772-3, Ramkey’s “work is not preliminary to the set-up of the telephone network, but rather part of its ongoing expansion and modernization … the work done involves rearrangements or additions to existing switching equipment in operational central offices….I think is analytically much closer to maintenance than to ordinary construction of a federal undertaking. …  It is simply an essential part of the operations process.”

As a result, the court concluded that Ramkey’s work was vital, essential or integral to a federal undertaking and should be federally regulated.

Impact

In two major decisions of the OLRB following Ramkey OLRB, namely LIUNA, Local 183 v Cablecan Corp[5] and IUOE, Local 793 v Amec Foster Wheeler Americas Ltd.,[6] the Ontario Labour Relations Board followed Ramkey OLRB and appeared to signal its intent to extend jurisdiction over almost all construction work – even construction work that was vital, integral or essential to a federal undertaking. Arguably, the Divisional Court’s Ramkey decision may reverse that course, as it confirms that in, certain circumstances, construction work that is vital, integral or essential to a federal undertaking may be subject to federal – not provincial – labour jurisdiction.

[1] 2018 ONSC 4791 (Div Ct) [Ramkey].

[2] 2017 CanLII 16933 (Ont LRB) [Ramkey OLRB]

[3] SO 1995, c 1, Sched A, ss 126 – 150.

[4] Ramkey, supra note 1 at para 56.

[5] 2018 CarswellOnt 5069 (OLRB).

[6] 2018 CarswellOnt 10855 (OLRB).