Interest arbitration

A buyer who inherits a union may meet interest arbitration if bargaining for a new agreement stalls. It differs from grievance arbitration: the Canada Labour Code requires every collective agreement to contain a provision for final settlement without stoppage of work, by arbitration or otherwise, of all differences concerning its interpretation, application, administration or alleged contravention, while interest arbitration sets terms. See the key considerations when buying a unionized business.

Federal rules

Under s.79 of the Canada Labour Code, an employer and a bargaining agent may agree in writing to refer any matter respecting the renewal or revision of a collective agreement, or a new agreement, to a person or body for final and binding determination. That agreement suspends the right to strike or lockout and constitutes an undertaking to implement the determination. Under s.80, where the parties are required to bargain for a first collective agreement and the requirements of paragraphs 89(1)(a) to (d) have otherwise been met, the Minister may direct the Board to inquire into the dispute and, if the Board considers it advisable, to settle the terms and conditions. Those terms bind the parties and the employees in the bargaining unit, except to the extent the parties later amend them by agreement in writing.

Ontario

Section 43 of the Labour Relations Act, 1995 deals with first agreement arbitration. Where the parties cannot reach a first collective agreement and the Minister has released a notice that it is not considered advisable to appoint a conciliation board, or has released a conciliation board’s report, either party may apply to the Board to direct settlement of the first agreement by arbitration. Section 43(2) lists the reasons for which the Board shall direct it, including any other reason the Board considers relevant.

What to ask

• Whether the agreement in force is a first agreement or a renewal
• Whether any written agreement refers renewal terms to final and binding determination
• Where bargaining stands and what the Minister or Board has done

This entry covers federal law and Ontario only; check the rules where you are.