The Ontario Divisional Court has dismissed the Canadian Union of Postal Workers’ (CUPW) application for an early judicial review of a labour arbitrator’s preliminary decision regarding the termination of a Canada Post employee for alleged benefits fraud.
The court ruled that the application was premature and did not meet the exceptional circumstances required to justify immediate judicial intervention.
Justice O’Brien granted Canada Post’s motion to quash CUPW’s application, emphasizing the importance of allowing the administrative process to conclude before seeking judicial review. “Courts will decline to hear an application for judicial review of an interlocutory decision until the completion of the underlying administrative proceeding, absent exceptional circumstances,” Justice O’Brien noted, citing established legal principles aimed at preventing fragmented and piecemeal litigation.
Background of the dispute
The case centres on the termination of Mr. W., a former Canada Post employee represented by CUPW. Mr. W. was dismissed after Canada Post alleged he had dishonestly claimed certain healthcare benefits. The termination followed an investigation conducted by Canada Post’s benefits provider, Canada Life. CUPW filed a grievance challenging the termination under the collective agreement, which is one of several similar grievances involving allegations of benefits fraud currently pending between the union and Canada Post.
At the arbitration hearing, CUPW raised two preliminary objections:
Timeliness of the Report: CUPW argued that the termination was null and void because Canada Post failed to comply with the collective agreement’s time limits. Specifically, Article 10.02(b) of the agreement requires the employer to place a “report” of the alleged infraction on the employee’s personal file within ten days of becoming aware of the misconduct. The union contended that this did not occur within the stipulated timeframe.
Due Diligence in Investigation: The union also claimed that Canada Post did not exercise due diligence in its investigation, as required by the collective agreement, rendering the termination invalid.
In his preliminary award, the arbitrator dismissed the first objection regarding the timeliness of the report. While agreeing that Canada Life acted on behalf of Canada Post and was subject to the same time constraints, the arbitrator concluded that the report was indeed placed on Mr. W.’s file within the required ten-day period.
A continuation of the arbitration hearing is scheduled for November 12 to address the second objection concerning the due diligence of the investigation.
CUPW’s application for judicial review
Unsatisfied with the arbitrator’s preliminary decision on the first objection, CUPW sought judicial review, arguing that exceptional circumstances warranted immediate court intervention. The union contended that:
Test Case Significance: Mr. W.’s case is effectively a test case that will influence at least 11 other pending grievances involving similar allegations and interpretations of Article 10.02(b). The union emphasized that the arbitrator’s decision is “final and binding” under the collective agreement for cases with “identical and/or substantially identical circumstances.”
Substantive Rights at Stake: CUPW asserted that the arbitrator’s ruling involved a final determination of substantive rights related to job security and procedural fairness, given the importance of timely notice for employees to prepare a defence.
Prejudice from Delay: The union argued that delaying judicial review would prejudice other grievors and bargaining unit members by prolonging uncertainty over the interpretation of critical collective agreement provisions.
Court’s rationale for dismissal
Justice O’Brien rejected CUPW’s arguments, finding that the circumstances did not meet the threshold for exceptional circumstances. The court held that:
Interlocutory Nature of the Award: The arbitrator’s decision was interlocutory, addressing only one of the preliminary objections. The overall arbitration, including the determination of just cause for termination, remains incomplete.
Test Case Status Insufficient: The agreement between the parties to treat Mr. W.’s grievance as a test case does not, in itself, justify early judicial intervention. Justice O’Brien referenced the decision in Toronto Transit Commission v. Amalgamated Transit Union Local 113, where the court found that even in test cases involving multiple similar grievances, judicial review of an interlocutory decision was premature.”An agreement to treat the underlying decision as a test case does not on its own justify the court’s early intervention,” the judge stated.
Substantive Rights Argument Unpersuasive: While acknowledging the importance of the rights involved, the court noted that issues of substantive rights or procedural fairness do not automatically warrant immediate judicial review. The judge referred to previous cases where courts declined early intervention despite significant rights being at stake.
Potential for Fragmentation: Allowing the application to proceed could fragment the administrative process and result in inefficiency. The court emphasized that the arbitration should be allowed to run its course, providing a complete record that might inform any future judicial review.”There is a specific downside to early intervention,” Justice O’Brien wrote. “The court would benefit from the full record of the arbitrator’s findings on these issues before intervening.”
Distinguishing Prior Cases: The court distinguished this case from others where early judicial review was permitted, such as Ontario (Ministry of Community Safety and Correctional Services) v. De Lottinville and London District Catholic School Board v. Weilgosh. In those cases, the matters involved statutory interpretations affecting broader legislative applications, whereas the present case concerns the interpretation of a collective agreement between specific parties.
As a result of the decision, the arbitration concerning Mr. W.’s termination will proceed, with the next hearing scheduled for November 12 to address the remaining preliminary objection regarding the diligence of Canada Post’s investigation.
CUPW was ordered to pay $5,000 in costs to Canada Post, as agreed upon by the parties.
For more information, see Canadian Union of Postal Workers v. Canada Post Corporation, 2024 ONSC 5924 (CanLII).
