What is Labour Relations?

When most people in Canada think about labour relations, a specific image surfaces: workers holding signs as they picket in front of their workplace. In reality, about 95% of collective bargaining exercises in Canada conclude successfully without a strike or lockout (United Food and Commercial Workers Union Canada, n.d.).

Strikes and lockouts are generally a last resort to resolve collective bargaining. However, that does not mean these two methods are unnecessary; strikes and lockouts are crucial for protecting the rights of unions and employers.

With that in mind, labour relations is so much more than strikes and lockouts. Studying labour relations means diving into many research areas, including history, workers’ rights, law, politics, motivation, negotiations, conflict resolution, global issues, social activism, and human resource management.

According to Hebden et al. (2020), the term labour relations refers to “the study of employment relationships and issues between groups of employees (usually in unions) and management, also known as union-management relations.” Industrial relations can sometimes be used interchangeably with labour relations.

Some scholars prefer to use the term labour relations only when referring to union-management relations. For example, McQuarrie (2015) argues that the term labour relations focuses too much on the union (labour) side of the relationship; in contrast, the term industrial relations aligns more with how the Canadian federal government uses the term. Specifically, McQuarrie defines industrial relations as “the relationship between a union (an organization run by and for workers) and the employer (the organization or organizations the workers in the union work for).”

Other scholars, such as Suffield and Gannon (2015), use industrial relations’ broader definition, which includes all aspects of the employment relationship in union and non-union workplaces. In this case, labour relations is a component of industrial relations.

For the purpose of this textbook, the term labour relations will refer to the relationship between employees and employers in a unionized workplace, similar to Hebden et al. (2020). Meanwhile, industrial relations will align with Suffield and Gannon’s (2015) definition, which includes both union and non-union employment relationships.

Employee Relations & Human Resource Management

Two more terms are essential when studying labour relations: employee relations and human resource management.

Employee relations often refers to the relationship between an employee and their employer in a non-union workplace. As discussed later in this book, employees in a non-unionized workplace negotiate and manage their employment concerns and issues directly with their employer.

According to Hebden et al. (2020), employee relations is “the study of the employment relationship between employers and individual employees, usually in non-union settings.” Employee relations in a non-unionized workplace include any activities undertaken by the HR department to manage the employee-employer relationship.

Since this textbook focuses on labour relations, it will not refer to employee relations directly.

Human resource management is “the broader study of the management of people in organizations to drive successful organizational performance and the achievement of the organization’s strategic goals.” (Dessler et al., 2013). The study of human resource management includes labour relations and employee relations.

Labour Relations Terminology

Like other fields of study, labour relations has its own language and terminology. The following list, adapted from Dessler et al. (2013), includes some basic terms that are helpful to know.

• Union — An officially recognized body representing a group of employees who have joined together to present a collective voice in dealing with their employer.
• Union Steward / Shop Steward — A union member elected by workers in a particular department or area of a firm to act as their union representative.
• Collective Bargaining Agreement (CBA) — A written contract between the employer and a union that outlines many of the terms and conditions of employment for employees in a bargaining unit.
• Collective Bargaining — Negotiations between a union and an employer to arrive at a mutually agreeable set of terms and conditions.
• Grievance — A written allegation of a contract violation, filed by an individual union member, the union, or management.
• Strike — Temporary refusal by union members to continue working for an employer.
• Lockout — Temporary refusal of a company to continue to provide work for union employees involved in a labour dispute.
• Labour Relations Board (LRB) — An independent body responsible for the administration of labour relations legislation (law) affecting employers, employees, and unions in each jurisdiction (province or territory).
• Arbitrator — An individual who hears disputes between unions and employers and renders final binding decisions.
• Bargaining Unit — The group of employees in a firm, plant, or industry that has been certified by the labour relations board as appropriate for collective bargaining purposes.

Reasons to Study Labour Relations in Canada

Why is it necessary to study labour relations? Many students in business or management education programs ask this exact question and how labour relations is relevant to their field of study. These students may argue that modern workplaces no longer need unions or believe they will likely never encounter a union if they do not work in a public sector.

Despite these arguments, there are several reasons why aspiring human resource professionals and business leaders will benefit from studying labour relations in Canada.

1. Unionization Rates in Canada Remain Steady

Canadian workers benefit from a wide range of laws and regulations related to employment, health, and safety. Nevertheless, Canada’s unionization rate is around 30% (Statistics Canada, 2024b). Although unionization rates fell significantly by 6.1% between 1981 and 1997, the rate of decline has since been less than 3% (Morissette, 2022).

Unionization rates in 2022 followed the pattern of previous years, with Ontario’s 24.7% the lowest and Newfoundland and Labrador’s 38.7% the highest (Morissette, 2022). In 2023, a few changes, most notably with Alberta and Ontario, shifted places for the lowest unionization rates (Statistics Canada, 2024b). While public sector workplace union rates remain higher than the private sector, the overall percentage of workers represented by a union means a human resource management or business graduate will likely encounter a unionized workplace during their career.

See Figure 1.1 below for unionization rates in all Canadian provinces as of 2023.

The characteristics of workers represented by a union in Canada have also shifted over time. Unions traditionally represented men working in primary industries for private-sector employers. However, as the economy shifted its focus from a resource-based industry towards a more service-based economy and a larger public service, the number of men represented by unions gradually declined. Today, a unionized worker is more likely to be an educated woman working in the service or public sector.

While you may not see yourself fitting the mould of a unionized worker, the likelihood of you working in a unionized setting throughout your career is quite likely given the unionization rates. Many sectors have higher than average rates of unionization, such as healthcare and social service, manufacturing, construction, public administration, and education (Statistics Canada, 2024a).

Figure 1.3: Unionization Rates in Canada as of 2023 (data from Statistics Canada (2024b))

2. Union Membership as a Prerequisite to Employment

Non-management professional positions in unionized workplaces may require union membership as an employment condition. Such a requirement is especially prominent in public sector workplaces.

Professionals that may be required to join a union include people in accounting, finance, information technology, communication, marketing, and, in some cases, human resources. As such, knowledge of labour relations and unions can help new professionals understand how work environments and relationships differ between union and non-union workplaces.

3. Impact of Unions & Unionized Workplaces on Non-Union Organizations and Employees

In July 2023, the International Longshore and Warehouse Union Canada (ILWU) went on strike against their employer, the BC Maritime Employers Association, for almost two weeks (Bird, 2023). The 7,400 ILWU members working at the Port of Vancouver play a critical role in ensuring the movement of goods across Canada to retailers. Their work directly impacts the supply chain of many exporters, importers, retailers, and manufacturers; as a result, the strike affected the entire Canadian economy.

Experts estimated that the strike cost businesses around $100 million in lost revenue and sales (Bird, 2023). Many affected retailers and manufacturers were non-union workplaces, yet unexpected delays in receiving products and materials directly impacted them.

Furthermore, employees in non-union workplaces may be affected by labour disputes in transit and transportation organizations, schools, and daycares, as these directly impact their ability to attend work. Because of this, managers, leaders, and human resource professionals should be aware of how unionized organizations could directly or indirectly affect their operations.

4. Canadian Labour Laws Make Unionization an Option for Most Workers

As explained later in this book, the Canadian constitution and provincial and federal labour laws make forming a union or joining an existing one an option for most non-management workers. Therefore, understanding employees’ rights and means to form a union and employers’ rights and limitations to resist such efforts helps employers and human resource professionals make organizational decisions in non-union workplaces.

Without understanding unfair labour practices, employers undertaking specific actions to resist unionization may find themselves on the wrong side of labour law and face serious consequences. Knowledge of unions may also prompt employers to develop a more proactive labour relations strategy, which the chapter on Management of Labour Relations will discuss in more detail.

5. Knowledge of Labour Relations Improves Employability

Most business school graduates want to secure their first professional role as soon as possible after completing their degree or diploma. With the higher unionization rates in Canada, graduates with knowledge of labour relations and people management increase their chances of securing employment in a professional role.

This knowledge especially benefits HR graduates applying for a role within an HR department with a labour relations function. Not only does knowing labour relations increase employability in HR settings, but it also creates additional career pathways that are interesting and challenging.

Differences Between Union & Non-Union Workplaces

Once a group of employees acquires a union, the relationship between management and employees significantly changes. Table 1.1 summarizes key differences in the contractual relationship between employers and their unionized workers. Below the table is an explanation of each of these differences.

Legal Agreement

When you work in a non-unionized environment, you sign an employment contract or offer letter with your employer before you begin work — or at least you should do this!

In a unionized workplace, you may receive an offer letter, but the main terms and conditions of employment, including wages, benefits, and hours of work, are already agreed to and documented in the collective agreement between the employer and the employees/union. Typically, your offer letter will outline your start date and hourly rate of pay but will direct you to the collective agreement for all other details.

Who Negotiates Terms and Conditions of Employment?

When you are offered a job in a non-unionized workplace, you will usually be given time to consider the offer. This means you have an opportunity to negotiate some or all your terms of employment with the employer. Perhaps you were hoping for a higher wage or more vacation time. Before you sign your job offer, you can ask for more than that original offer, and if you are lucky and convincing, you might get it. If you have been working there for a while and feel you deserve a raise, you may also negotiate a new salary with your employer directly if they agree that you deserve a raise.

In a unionized workplace, the employer can no longer negotiate directly with employees or groups of employees. When a union is the sole bargaining agent for a group of workers, only representatives of the union (generally workers in the workplace) can negotiate with the employer on behalf of all workers or a group of workers. This most commonly happens during collective bargaining negotiations, but there are instances between rounds of bargaining where the employer and the union wish to change the terms and conditions of employment. In these cases, the union and employer may negotiate changes and sign a letter of understanding (LOU) to amend the existing contract.

There are many possibilities if both parties are willing to make changes, but what is important to understand is that once a union represents a group of workers, those workers and the employer cannot negotiate individual contracts. When you learn more about unfair labour practices, you will also see how employers can find themselves in trouble with their local labour relations board if they try to make side deals with workers without the union’s knowledge or involvement.

For some workers, this non-negotiation aspect is positive. When you are hired in a unionized workplace, you do not have to worry about not getting the best deal you could have — the deal is spelled out in a legal document for all to see. However, for others who feel they could negotiate a better deal on their own, this can deter working in a unionized setting.

Nature of Terms and Conditions of Employment

Another difference closely related to the previous one is the type of terms and conditions you may see in a unionized workplace. Typically, you will find that these are similar across employees and employment classifications and possibly like other workplaces in the same industry. By their very nature and purpose, unions take a collective approach to representing workers and negotiating contracts. They represent not just one worker in a team, department, or organization; they represent many.

As a result, employees represented by a union will have similar or the same benefits, vacation provisions, overtime compensation, and professional development opportunities. Of course, two employees doing different jobs may have a different wage rate or different hours of work. Still, the practice and policy that allows them to advance in the salary scale or change their schedule will typically be the same.

In non-union workplaces, this may not be the case. While many organizations, especially large ones, will have detailed and comprehensive policies on employment matters, the nature of individual contracts might mean that one employee can advance through the salary scale at a different rate than someone else. With the ability to make changes to employment terms and conditions without negotiation, the employer may also have policies and practices that are very different than those found in unionized workplaces.

For example, if an employer wants to start offering work-from-home opportunities or change your shift time, they only need to comply with employment standards and human rights when making these changes. They do not need to negotiate this with a union. This, of course, could be a good thing if the change they are making positively affects you and your coworkers, but if it negatively affects you, it might not be.

Process to Resolve Disputes

Disputes are inevitable in workplaces regardless of how clear and comprehensive employment policies and collective agreements are. The way disputes are resolved is significantly different in a unionized workplace.

When you do not have a union representing you in a workplace, and you disagree with the interpretation of a policy or practice your employer has created, you need to use internal mechanisms, such as complaint processes, to resolve them. This might involve escalating a complaint to a higher-level manager or the human resource department, but in most workplaces, you will navigate this independently.

Suppose you are terminated or believe your employer has violated the law. In that case, you would need to hire a lawyer or file a complaint with the organization responsible for administering the law. For example, if your employer is not paying you for all your hours worked, you would file a complaint with the employment standards branch in your jurisdiction. If you are terminated and believe the employer did not have cause or justification to terminate you, you would need to file a lawsuit for wrongful dismissal and take your complaint through the courts.

In a unionized workplace, the grievance arbitration process is written into your collective agreement. This process explains how you can bring a complaint forward and what the steps are to resolving your complaint. Typically, it is a three- or four-step process, with the final step being the decision to involve an impartial third party, called an arbitrator. You will learn a lot about the grievance arbitration process in a future module, but for now, know that this is the legal process to resolve disputes in a unionized workplace. The union supports employees through this process and will pay any legal fees incurred to represent the employee during arbitration.

Changes to Employment Terms

Over time, employers will want to change the terms and conditions of employment. This can be to comply with changes in laws or regulations, adapt to changes in their competitive market or product offering, or due to financial or economic challenges. While this is understandable, these changes may impact employees negatively, which is why employment standards address changes to employment contracts.

In a non-union setting, if an employer wants to fundamentally change your employment contract, they must give a certain amount of notice, usually based on your length of service, and seek your consent. If they do not give this notice and/or you do not agree to the changes to your contract, the employer can find themselves in a constructive dismissal situation. According to an article about constructive dismissal from The HR Reporter, constructive dismissal is “When an employer makes substantial changes to the terms and conditions of an employee’s employment contract, whether explicitly or implicitly, without the employee’s consent, the employee may resign from the company and claim constructive dismissal” (Labitoria, 2021). If you do not accept the changes, it is as if the employer has terminated you.

In a unionized setting, the doctrine of constructive dismissal does not apply. When a union is present, your terms and conditions of employment are contained in the collective agreement. As explained above, this contract between the union (on behalf of employees) and the employer is re-negotiated regularly. Thus, if the employer were to independently make changes to the contract, they would violate this legal document, and the union would file a grievance against them. All terms and conditions must be negotiated between the union and the employer, not the employer and individual employees.

Employee Termination

The final significant difference is how employee terminations are treated. Similar to the previous discussion about employment terms, requirements for lawful termination in a non-unionized workplace fall under employment standards legislation. Typically, an employer must give notice if termination is without cause or provide payment in lieu of notice. Severance pay may also be required or provided. For with-cause terminations, there is no requirement for notice. If an employee disagrees with the termination, their recourse or way to address this is to file a wrongful dismissal suit against the employer. This may require them to hire legal counsel.

In a unionized setting, the way without cause terminations are handled is written into the collective agreement. This article of the agreement will usually explain the circumstances when an employer can terminate without cause (i.e. technological change) and what amount of payment or notice an employee is entitled to. A termination without cause will almost always result in a grievance filed by the union. The grievance process is then used to determine if there was sufficient cause to terminate. It could result in the employee remaining terminated or receiving a lesser penalty for whatever action resulted in their termination. Grievances for termination may also lead to an arbitration proceeding if the employer and union cannot agree on the just-cause nature of the termination.

While there are many other differences between non-unionized and unionized workplaces, this outlines the most significant contractual differences. In the next module, you will learn about the legal framework for labour relations. This will highlight the different laws that are unique to labour relations in Canada and will illuminate other differences you may not have considered at this point.

Conclusion

Labour relations is a broad subject connected with many other topics. It is impossible to study and fully understand the labour relations landscape in Canada without also learning about the legal framework, politics, management strategies, human resource management, and history. These interdisciplinary connections make the topic interesting but also complex and sometimes challenging. Understanding the language and terminology and how labour relations are similar to and different from other employment or work-related topics will help your understanding as your learning progresses.

Media Attributions

• Figure 1.1 Unionization rates of men and women (1997–2023) [created using data from Statistics Canada (2024a)] by the author is under a CC BY-NC-SA license.
• Figure 1.2 Public vs. private sector union rates in Canada (1997–2023) [created using data from Statistics Canada (2024a)] by the author is under a CC BY-NC-SA license.
• Figure 1.3 Union coverage rate in Canada [created using data from Statistics Canada (2024b)] by the author is under a CC BY-NC-SA license.

References

Bird, L. (2023, July 18). The B.C. port strike is over, but economic impact could last weeks. CBC. https://www.cbc.ca/news/business/bc-port-strike-economic-impact-1.6907182

Dessler, G., Chhinzer, N., & Cole, N. D. (2013). Human resources management in Canada (12th ed.). Pearson Education.

Gibson, C. (2022, January 4). Concordia University of Edmonton Faculty Association on strike. Global News. https://globalnews.ca/news/8487276/concordia-university-of-edmonton-faculty-association-on-strike/

Hebdon, R., Brown, T., & Walsworth, S. (2020). Industrial relations in Canada (4th ed). Nelson.

Labitoria, C. (2021, November 26). What you need to know about constructive dismissal. Canadian HR Reporter. https://www.hrreporter.com/focus-areas/employment-law/what-you-need-to-know-about-constructive-dismissal/362122

McQuarrie, F. (2015). Industrial relations in Canada (4th ed.). John Wiley & Sons.

Morissette, R. (2022). Economic and social reports (Catalogue No. 36-28-0001). Statistics Canada. https://www150.statcan.gc.ca/n1/en/pub/36-28-0001/2022011/article/00001-eng.pdf?st=xqTq7-Cl

Statistics Canada. (2024a, January 5). Union coverage by industry, annual. (Table No. 14-10-0070-01) [Table]. Government of Canada. https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=1410007001

Statistics Canada. (2024b, January 5). Union status by geography (Table No. 14-10-0129-01) [Table]. Government of Canada. https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=1410012901

Suffield, L., & Gannon, G. L. (2015). Labour relations (4th ed.). Pearson Canada.

United Food and Commercial Workers Union Canada. (n.d.). Facts about unions. Retrieved December 30, 2023, from https://www.ufcw.ca/index.php?option=com_content&view=article&id=29&Itemid=49&lang=en#:~:text=In%20reality%2C%20there%20are%20very

Long Descriptions

Figure 1.1 Long Description: Unionization rates for men start at about 55% in 1997, while women start at about 45%. Unionization rates for men decrease as the years pass, while women’s rates increase. Between 2008 and 2009, the two sexes have equal unionization rates. After that, men’s rates sharply decrease to 48%, while women’s rates sharply increase to 52%. Both sexes remain at these unionization rates, with only minor fluctuations, until 2023. [Return to Figure 1.1]

Figure 1.2 Long Description: Public sector unionization rates start at about 51% in 1997, while private sector rates start at about 49%. As the years pass, the public sector rates gradually increase to about 61% in 2023, while private sector rates decrease at a similar rate to 39%. [Return to Figure 1.2]