Northern Exposure

Another Strike Against Wal-Mart in Quebec: Arbitrator Imposes Collective Agreement

For the last five years, two Wal-Mart big-box stores in Quebec have been the subject of certification applications filed by the United Food and Commercial Workers Union (UFCW). The first store to be unionized was located in the town of Jonquière. Wal-Mart decided to close down that operation in 2005 immediately after the union applied for binding arbitration to settle the terms of the collective agreement.

The Quebec Labor Code provides that an arbitrator designated by the Minister of Labor can impose the content of a first collective agreement. This may be done when the parties are unable to reach an agreement, after negotiation and government-assisted mediation/conciliation. In imposing an agreement, the arbitrator must decide the terms “according to equity and good conscience.” The arbitrator may also take into account the conditions of employment that prevail in similar businesses.

The Jonquière case is currently before the Supreme Court of Canada. It recently heard arguments by UFCW that the law which allowed Wal-Mart to close the store violates the employees’ constitutional right of freedom of association. The court’s decision is expected this fall.

The second store to be unionized in Quebec is located in St-Hyacinthe. Approximately 180 workers have become the first group of Wal-Mart big-box store employees in Quebec to be covered by a collective agreement. The arbitrator’s decision was delivered last April after more than four years of legal challenges, negotiations, and mediation.

The St-Hyacinthe collective agreement comes on the heels of a 2008 arbitration that imposed the terms of a collective agreement for a group of eight employees of Wal-Mart’s Tire and Lube Express outlet in Gatineau, Quebec. Wal-Mart decided to close down that operation shortly after the arbitrator’s award.

In the St-Hyacinthe case, the parties had, through mediation, agreed on most clauses of the collective agreement. In the decision, the arbitrator noted the efforts made by the parties and their willingness and openmindness to achieve a settlement on the content of this first contract.

Is this an indication of future contract negotiations between Wal-Mart and the UFCW? We will soon find out. First contract negotiations are underway for a large store and a Tire and Lube Express outlet in Hull, Quebec. Negotiations are also underway for a Wal-Mart store in Weyburn, Saskatchewan.

The UFCW is not cheering too loudly about the St-Hyacinthe decision.  The arbitrator rejected several of its proposals on key issues. For instance, the employer’s proposals were adopted with respect to salary increase and dental insurance. On salary, Wal-Mart was permitted to maintain its policy that salary increases vary according to employees’ performance. Performance quality is determined pursuant to annual evaluations. This practice is in place in all Wal-Mart’s stores across Canada. On the second point, the arbitrator adopted Wal-Mart’s Canada-wide dental insurance plan.

However, “according to equity and good conscience,” the arbitrator awarded a salary increase of 30 cents per hour upon the signing of the collective agreement, with a similar increase in the second year of the agreement.

There is no doubt that the Supreme Court of Canada’s decision regarding Jonquière will have a significant affect on future negotiations and business decisions that Wal-Mart (and others) may consider in Canada. Before the Court, each side understandably took firm stands. Wal-Mart argued it has the right to close any store it wants, anytime it wants. The union argued that intimidation of employees who seek to form a union is illegal. It follows, they state, that the threatening and subsequent closing of an entire store where the employees wish to unionize, clearly fits under that description and must also be unlawful.

Northern Exposure will keep you informed of future developments.

Contact the author, Dominique Launay