Bill 124 Update: Manitoba Court of Appeal Finds Wage Restraint Legislation Lawful

In 2017, the Manitoba government introduced  the Public Services Sustainability Act, which mandated a two-year wage freeze for government employees once their existing contracts expired.  The freeze was followed by a 0.75 per cent pay increase in the third year and one per cent in the fourth.  The Act was passed in spring 2017, but has not yet been proclaimed in force.  Since then, the government has nonetheless required some of its employers to freeze wages or restrict wage increases.

Unions challenged the legislation on the basis that it violated section 2(d) of the Charter of Rights and Freedoms, which protects workers’ rights to bargain collectively.   However, the Manitoba Court of Appeal ruled in a unanimous decision released Wednesday that the legislation is lawful and does not violate the Charter.

The Court of Appeal held that “[w]hile there can be no doubt that the imposition of wage restraint legislation … impacts or interferes with the collective bargaining process, the case law establishes that that type of legislative interference does not amount to “substantial interference” when it is broad-based and for a limited period of time.”

This is not necessarily the end of the story as the Manitoba Federation of Labour could seek leave to appeal to the Supreme Court of Canada.  Moreover, this case law has important implications for related legislation here in Ontario – specifically, the Protecting a Sustainable Public Sector for Future Generations Act (also known as “Bill 124”).    A coalition of nearly 40 unions filed a constitutional challenge to Bill 124, and advocates have cited the lower court decision in Manitoba as support for a finding that Bill 124 is unconstitutional.   Last week’s decision by the Manitoba Court of Appeal will certainly have raised concerns related to their prospects for success here in Ontario.

PooranLaw will continue to monitor legal developments related to Bill 124.  In the meantime, if you require legal assistance, we encourage you to reach out to your regular PooranLaw lawyer, or any member of our team.

Note: This article provides general information only and does not constitute, and should not be relied upon as, legal advice or opinion. PooranLaw Professional Corporation holds the copyright to this article and the article and its contents may not be copied or reproduced in any form, in whole or in part, without the express permission of PooranLaw Professional Corporation.