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CBA takes tough stand on union bill
By Cristin Schmitz
May 08 2015 issue

The federal government is expected to push through a bill before Parliament adjourns for the summer that the Canadian Bar Association contends impinges on unions’ constitutional rights and their solicitor-client privilege.

Bill C-377, which imposes extensive financial disclosure obligations on unions, was undergoing scrutiny by the Senate’s legal and constitutional affairs committee at press time. But the former chair of the CBA’s national pensions and benefits law section told The Lawyers Weekly he doesn’t expect that the Conservative-dominated committee will heed the call of his organization and the Federation of Law Societies of Canada to explicitly exempt all information protected by solicitor-client privilege from the disclosure requirements that the government wants to impose on labour organizations and labour trusts.

“My sense of it is that the Conservative caucus has rallied behind it, so it has a very good chance of passing before they break for the summer,” said Michael Mazzuca of Toronto’s Koskie Minsky.

Mazzuca noted, however, that the bill’s anticipated problems may never materialize given that unions’ first reporting year would be 2016, with actual reporting to begin only in 2017.

“That leaves a fair bit of time, both for politics to enter the fray, because we do have a federal election, and also leaves a fair bit of time for court challenges as well before the reporting actually becomes mandatory,” he said.

The government-backed private member’s bill would require labour organizations and labour trusts to produce detailed and extensive financial information to the minister of revenue that would then be posted on the Canada Revenue Agency’s website in a searchable form. The broad array of information that may have to be particularized includes the salaries and benefits paid to particular officers, directors, trustees, employees and contractors, which the CBA says raises privacy concerns.

“The bill interferes with the internal administration and operations of a union, which the constitutional protection freedom of association precludes,” the CBA warned in one of several submissions to Parliament. Moreover, labour organizations would be required to file statements with the minister detailing their disbursements for political activities, lobbying, organizing and collective bargaining — subjects which concern their membership but not “the public at large,” the CBA says.

Bill C-377 contains two specific exemptions from the bill’s financial reporting requirements for solicitor-client privileged information — disbursements for “legal activities” and disbursements related to activities “other than those that are primarily carried on for members of the labour organization or labour trust.”

The CBA and FLSC contend that leaves many activities typically undertaken by labour lawyers, such as union organizing, lobbying or political activity, ostensibly subject to the bill’s reporting obligations.

Their lobbying met with surprising success in June 2013 when 16 Conservative senators broke ranks to vote with their Liberal counterparts (49 to 33) to effectively gut Bill C-377’s union salary and spending reporting provisions, while also adding a blanket exemption from disclosure for any information protected by solicitor-client privilege. Six Conservative senators also abstained from that vote. However the amended bill died on the order paper when Parliament later prorogued.

C-377 was reinstated, without the Senate amendments, in October 2013 and languished for more than a year in the Senate. Meanwhile, many of the Conservatives who voted with the Liberals or abstained have left the Senate, including Hugh Segal, who led the charge to amend the bill.

“I don’t sense that there is somebody who is prepared to play [Segal’s] role this time within the Conservative caucus,” said Mazzuca, who testified at the Senate committee April 23. “I certainly didn’t sense that same type of concern this time around that seemed to be prevalent last time. I think last time that this bill came before the Senate the senators were prepared to raise some real and genuine concerns, irrespective of what party they were from.”

Not all legal experts who spoke to the Senate committee agreed with the CBA’s opinion that C-377 should be killed outright.

Testifying as an individual, former Supreme Court Justice Michel Bastarache told senators April 23 he sees “no problem” from a Charter perspective.

“One must understand the limits” of the right to freedom of association “and distinguish what is constitutionally protected and what depends on legislation,” he said. The Charter’s procedural guarantee of freedom of association “protects the ability to unite, to make representations and to receive an answer in good faith. The Supreme Court ruled on this in Dunmore, and Health Services, and in Fraser.”

He pointed out C-377 does not regulate the activities of labour unions or how they spend money.

“Even if an extremely wide definition of the right was adopted, the government would, in my view, be able to justify an infringement under s. 1 of the Charter because of the important goals of transparency and accountability and the fact that there is minimal interference with actual rights.”

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