Are your employees entitled to two days of paid leave beyond what their collective agreement provides? In Quebec, the debate continues

Employers are regularly faced with grievances seeking additional days of paid leave beyond what is provided in the applicable collective agreement. In fact, there is genuine debate between grievance arbitrators on the subject, to the point that their decisions sometimes seem to conflict with one another.

On January 24, 2023, the Quebec Court of Appeal rendered its decision in Maax Bath inc. c. Syndicat des salariés d'acrylique de Beauce (CSD)^[1] ("the Maax Bath decision"), where, for the first time, it addressed a matter involving the application of paid leave days resulting from sections 79.1, 79.7 and 79.16 of the Act respecting labour standards^[2] ("the Act") in a workplace governed by a collective agreement that already provided for certain days of paid leave. 

The law before the Maax Bath decision

It is important to note that when certain provisions of the Act to amend the Act respecting labour standards and other legislative provisions mainly to facilitate family-work balance^[3] came into force on January 1, 2019, new days of paid leave were added to the Act.

Specifically, since that date, an employee is entitled to be paid^[4] during the first two days of absence taken each year for the family or parental reasons covered by section 79.7 of the Act^[5] or owing to sickness or other reasons contemplated by section 79.1 of the Act.^[6] This right to paid leave days starts once the employee has three months of uninterrupted service, even if the employee was absent previously.

However, an employer is not required to pay for more than two days of leave in the course of the same year if the employee is absent for any of the reasons contemplated in sections 79.1 or 79.7 of the Act.^[7] For example, if an employee who is entitled to these days of paid leave has already been absent for two days during the year due to illness, the Act does not require the employer to pay the employee if the latter is absent again for a day during the same year for family or parental reasons.

It should be borne in mind that, as a general rule, the labour standards contained in the Act are of public order. Therefore, a provision in a collective agreement or employment contract that derogates from a labour standard contained in the Act is absolutely null unless the provision is more advantageous than the corresponding standard in the Act, or unless the Act expressly permits a derogation.^[8]

The implementation of these new paid days pursuant to the Act is relatively simple in workplaces where the employer does not offer employees more days of this kind of leave than the Act requires. In unionized workplaces, however, the parties often include a variety of paid leave days in their collective agreements, such as floating days, personal leave days and banked sick leave. The extent to which such paid leave days granted by collective agreements can be considered to satisfy the minimum requirements of the Act has not been defined by the legislator with precision.

As a result, several times over the past few years, arbitrators have been called upon to determine whether the new days of paid leave granted by the Act are "lesser and included" or whether they must be considered to be over and above the days of leave already granted by the collective agreement. This question, which continues to cause controversy in the grievance arbitration case law, is the central issue in the Maax Bath decision.

The facts

The case originated with a collective grievance brought by the respondent union contesting the employer's refusal to remunerate in accordance with the new provisions of the Act three employees who were absent due to illness or to family obligations. Instead of remunerating the employees, the employer had requested them to use the floating days to which they were entitled under their collective agreement. Under the grievance, the union asked, among other things, that the employer be ordered to pay the employees their salaries for the days they were absent.

Martin Racine was the arbitrator who heard the grievance. He found that the floating days could be used for a variety of reasons, such as an appointment with a car mechanic, or a fishing or golf day. The days could also be used for the reasons covered by sections 79.1 and 79.7 of the Act. The arbitrator also found that the entitlement to floating days under the collective agreement started when the employee had accumulated one year of seniority.

In light of all this, the arbitrator granted the grievance in part. He declared that the employer had to remunerate at least two days of absence per year for family obligations or illness, even if the floating days granted by the collective agreement had already been used for other reasons. He also declared that this obligation applied with respect to any employee who had at least three months of seniority. However, he dismissed the employees' claim, holding that they could have used their floating leave for the days they were absent.

The employer, Maax Bath Inc., brought an application for judicial review before the Superior Court against Arbitrator Racine's decision. The Honourable Justice Claudia P. Prémont dismissed the application for judicial review on the basis that the arbitrator's decision was reasonable. The employer appealed from this judgment before the Court of Appeal.

The Maax Bath decision

The Court of Appeal dismissed the appeal, holding that the arbitrator's decision met the reasonableness standard required by the courts and that the Superior Court did not err in the administration of the test used to determine whether the arbitrator's decision was reasonable or not.

The Court of Appeal reiterated the method that must be used to determine whether the provisions of a collective agreement provide terms at least as advantageous as those contained in the Act with respect to paid leave for illness or for family obligations. With respect to this method, it referred to the decision in Montreal Standard v. Middleton,[9] a case frequently cited by arbitrators in similar matters, and it explained that the following analysis needs to be carried out:

• The arbitrator must first ascertain whether the working condition in the collective agreement is of the same nature and pertains to the same subject as the statutory standard.
• The arbitrator must then determine whether the provision in the collective agreement is at least as advantageous as the standard.

Analyzing the arbitrator's reasoning, the Court of Appeal found that, in his opinion, the floating leave days granted by the collective agreement are not of the same nature and do not pertain to the same subject as the provisions of the Act concerning payment for days of leave taken for family obligations or due to illness. The arbitrator asserted that the floating leave clause serves much broader purposes than illness or family obligations, and that the floating leave it grants amounts to additional vacation days. The Court also found that, in the arbitrator's view, the floating leave clause does not offer conditions equivalent to the provisions in the Act, notably because of the seniority required to be eligible for it, and because employees who have used all of their floating leave for reasons other than those contemplated by sections 79.1 and 79.7 of the Act would lose the benefit of the paid days if they had to be absent for those reasons. It was based on these findings that the arbitrator made his decision, which the Court of Appeal considered reasonable.

With respect to the existing controversy in the arbitration case law, the Court stated that it was not its role to [TRANSLATION] "decide the dispute, speak to the arbitration case law or reorganize it." In fact, the Court addressed the controversy in the following terms:

[TRANSLATION] [15] The parties have tendered arbitration decisions that may prima facie appear to diverge in their treatment of the problem raised by the case at bar. However, it is a well-known principle of administrative law that the existence of a controversy in the jurisprudence of an administrative tribunal is not sufficient to warrant the intervention of the courts. In other words, the fact that there are differences between [TRANSLATION] "two or three schools of thought with respect to the same subject [...] is not in and of itself a basis for granting judicial review." Therefore, even if an arbitrator's decision differs from the majority jurisprudence, this does not necessarily mean that its decision is unreasonable.

[16] In fact, the arbitration jurisprudence submitted by the parties does not consist of two monolithic blocks; the outcomes depend on the evidence and the legal texts applicable to each dispute. This contextualized consideration of the evidence is primarily something for arbitrators to conduct. Arbitrators can also grant the relief they consider appropriate under the circumstances of the cases that come before them. [Citations omitted.]

Conclusion

In sum, the Court of Appeal abstained from putting an end to the lively debate between arbitrators that has garnered the attention of labour and employment lawyers.

Given the situation, it will therefore remain possible in many cases for an employer to argue before a grievance arbitrator that the paid leave days contemplated in the Act are "lesser and included" in the days already granted by the collective agreements that govern the working conditions of their employees. The outcome of those cases will depend on the arbitrator's contextualized assessment of the evidence tendered, and on the wording of the applicable provisions of the collective agreements. 

The debate remains open.

For more information about the potential impact of this decision, we encourage you to contact a member of the Employment, Labour & Equalities Group at Gowling WLG.