Successor rights (labour relations)

These rules sit in labour relations statutes, not employment standards, and differ from the successor employer concept. A buyer of a unionized business meets them in diligence. See how successor rights work under the Ontario Labour Relations Act.

What each statute says

• Ontario: section 69 says that where a bound employer sells its business, the purchaser is, until the Board otherwise declares, bound by the collective agreement as if it had been a party. “Sells” includes leases, transfers and any other manner of disposition. Later subsections give the Board powers that can change this, such as where the buyer intermingles employees of several businesses.
• British Columbia: section 35 says that where a business or part of it is sold, leased, transferred or otherwise disposed of, the purchaser, lessee or transferee is bound by all proceedings under the Code before the date of the disposition, and a collective agreement in force continues to bind it.
• Federal: section 44 of the Canada Labour Code says the person to whom a federal business is sold is bound by any collective agreement that, on the sale date, applies to the employees employed in the business.

What to ask

Other provinces have their own rules. In Ontario, where a question arises as to whether a business has been sold, the Board determines it, and its decision is final and conclusive for the purposes of the Act. Ask for the collective agreement and any certification documents.