IN THE SUPREME COURT OF BRITISH COLUMBIA
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Citation: |
British Columbia Ferry and Marine Workers' Union v. British Columbia Ferry Services Inc., |
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2008 BCSC 1464 |
Date: 20081103
Docket: S081998
Registry: Vancouver
Between:
British Columbia Ferry and Marine Workers’ Union
Petitioner
And
British
Columbia Ferry Services Inc. and
British Columbia Labour Relations Board
Respondent
Before: The Honourable Madam Justice Wedge
Reasons for Judgment
| Counsel for the Petitioner |
B. Elwood |
| Counsel for Respondent British Columbia Ferry Services Inc. |
P. A. Csiszar |
| Counsel for the Respondent British Columbia Labour Relations Board |
D. W. Garner |
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Date and Place of Trial/Hearing: |
September 18 and 19, 2008 |
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Vancouver, B.C. |
[1] This application for judicial review concerns the suspension from duty of two employees of British Columbia Ferry Services Inc. (the “Company”). The suspended employees, Karl Lilgert and Kevin Hilton, were the crew members primarily responsible for navigating the Queen of the North on the night of March 21, 2006 when the vessel ran aground in Wright Sound, British Columbia, and sank.
[2] All crew members and most passengers were rescued before the vessel sank, but two passengers were not evacuated. They are presumed to have died in the accident. As a result of their deaths, the RCMP initiated a criminal investigation into the accident.
[3] The Company convened an inquiry with the objective of determining the cause of the tragedy and issuing a public report. In the course of the inquiry, the Company sought to question Mr. Lilgert and Mr. Hilton, among others, about the events immediately preceding the vessel’s grounding.
[4] On the advice of legal counsel, both men refused to answer the questions put to them at the inquiry unless they were assured their answers would be considered privileged and held in confidence by the Company pending the conclusion of the criminal investigation. The Company declined to provide such assurances. When Mr. Lilgert and Mr. Hilton maintained their refusal to answer the questions, the Company suspended them from their duties without pay.
[5] The British Columbia Ferry and Marine Workers’ Union (the “Union”), of which the two men are members, filed a grievance under the collective agreement challenging the suspensions. At the arbitration hearing, the Union argued that the crew members were entitled as a matter of law to remain silent in the face of the ongoing criminal investigation into the accident.
[6] In a decision dated March 22, 2007 (British Columbia Ferry Services Inc. and British Columbia Ferry and Marine Workers' Union (Re) (2007), 159 L.A.C. (4th) 165 [Arbitration Award]), the Arbitrator dismissed the grievance. In essence, the Arbitrator concluded that the right of the crew members to remain silent was outweighed by the interests of the Company in determining the cause of the accident and making full disclosure to the public.
[7] The Union applied to the Labour Relations Board (the “LRB”) under s. 99 of the Labour Relations Code, R.S.B.C. 1996, c. 244 (the “Code”) for a review of the Arbitration Award. The LRB dismissed the Union’s application, concluding that the Arbitration Award was consistent with the principles expressed or implied in the Code (British Columbia Ferry Services Inc. (Re), [2008] B.C.L.R.B.D. No. 5 [Original Decision]). The Union then applied to the LRB for leave to seek reconsideration of the Original Decision, but leave was denied (British Columbia Ferry Services Inc. (Re), [2008] B.C.L.R.B.D. No. 23 [Leave for Reconsideration Decision]).
[8] The Union now seeks judicial review of the Original Decision of the LRB to dismiss the Union’s application for review of the Arbitrator’s decision.
[9] Two issues arise on this application:
1. What is the appropriate standard of review of the Original Decision?
2. Applying the appropriate standard of review, should the Original Decision be set aside?
[10] Central to both issues is the law and policy generated by the LRB under its enabling statute concerning just and reasonable cause for discipline generally and, more specifically, the right of a unionized employee to remain silent when questioned about an employment matter. I will consider that legal framework before turning to the decision of the LRB now under review.
[11] The Company and the Union are parties to a collective agreement and, accordingly, governed by the Code. As a consequence of s. 84 of the Code, the Company cannot discipline or dismiss its unionized employees except for “just and reasonable cause.” The relevant aspect of s. 84(1) of the Code is as follows:
Every collective agreement must contain a provision governing dismissal or discipline of an employee bound by the agreement, and that or another provision must require that the employer have a just and reasonable cause for dismissal or discipline of an employee ...
[12] Where an employee is disciplined or dismissed for cause, the Union has the right under the collective agreement to file a grievance on behalf of the employee and seek review of the employer’s decision by an arbitration board convened under the collective agreement. Section 82 of the Code states:
(1) It is the purpose of this Part to constitute methods and procedures for determining grievances and resolving disputes under the provisions of a collective agreement without resort to stoppages of work.
(2) An arbitration board, to further the purpose expressed in subsection (1), must have regard to the real substance of the matters in dispute and the respective merit of the positions of the parties to it under the terms of the collective agreement, and must apply principles consistent with the industrial relations policy of this Code, and is not bound by a strict legal interpretation of the issue in dispute.
(Emphasis added)
[13] The LRB emphasized in the years immediately following the passage of the Code that while arbitrators were entitled to take guidance from the common law in such matters as estoppel and extrinsic evidence, they could not consider themselves bound by the common law in such matters. Instead, arbitrators were told they were required by s. 82(2) to apply principles consistent with industrial relations policy: Corporation of the City of Penticton and Canadian Union of Public Employees, Local 608 (Re), [1978] B.C.L.R.B.D. No. 26, 18 L.A.C. (2d) 307; University of British Columbia and Canadian Union of Public Employees, Local 116 (1976), [1977] 1 C.L.R.B.R. 13, [1976] B.C.L.R.B.D. No. 42.
[14] In Kinsmen Retirement Centre Association v. Hospital Employees' Union Local 180 (1985), 63 B.C.L.R. 292 at 298 (C.A.), the Court made the following observation about the closing words of s. 82(2):
And, though the words "strict legal interpretation" are not easy to interpret, I assume they mean that the arbitrators are not bound by the law except to the extent that it will guide them to a just result[.]
[15] An arbitrator’s decision may be appealed to the LRB, but only on the grounds specified in s. 99 of the Code. Section 99(1) provides as follows:
Appeal jurisdiction of Labour Relations Board
99(1) On application by a party affected by the decision or award of an arbitration board, the board may set aside the award, remit the matters referred to it back to the arbitration board, stay the proceedings before the arbitration board or substitute the decision or award of the board for the decision or award of the arbitration board, on the ground that
(a) a party to the arbitration has been or is likely to be denied a fair hearing, or
(b) the decision or award of the arbitration board is inconsistent with the principles expressed or implied in this Code or another Act dealing with labour relations.
[16] As the plain wording of the section discloses, s. 99 provides only a narrow avenue of appeal limited to ensuring that arbitration awards are consistent with the principles of the Code and the requirements of a fair hearing. Deference must be given to the arbitrator’s findings of fact and assessment of the evidence. Although the s. 99 review panel of the LRB “may have arrived at a different outcome, it will not interfere with an award where the principles [of the Code] on which the analysis is based are sufficiently expressed”: Health Employers Assn. of British Columbia (Rosewood Manor) (Re), [1998] B.C.L.R.B.D. No. 439 at para. 12.
[17] A party may apply to the LRB for reconsideration of a decision rendered under s. 99, but only in the limited manner prescribed by s. 141 of the Code. A party must seek leave to apply for reconsideration under s. 141(1). Leave is only granted where one of two prerequisites is met pursuant to s. 141(2). Subsection 141(2) provides as follows:
(2) Leave to apply for reconsideration of a decision of the board may be granted if the party applying for leave satisfies the board that
(a) evidence not available at the time of the original decision has become available, or
(b) the decision of the board is inconsistent with the principles expressed or implied in this Code or in any other Act dealing with labour relations.
[18] Where the ground of appeal is a matter of the general law not included in s. 99(1), a party affected by an arbitrator’s decision may appeal to the Court of Appeal: Code, s. 100.
[19] There is a large body of arbitral jurisprudence concerning the kind of employment conduct that may constitute just and reasonable cause for discipline. However, the concept of just cause is based on the statutory principles of s. 82 of the Code and, accordingly, an arbitrator’s decision concerning that matter is subject to review by the LRB under s. 99.
[20] Exercising its review powers under s. 99 in the leading decision of Wm. Scott & Co. (Re), [1977] 1 C.L.B.L.R. 1, [1976] B.C.L.R.B.D. No. 46, the LRB described at 5 the analysis arbitrators must undertake when determining whether an employer has dismissed an employee for just and reasonable cause:
… [A]rbitrators should pose three distinct questions in the typical discharge [or discipline] grievance. First, has the employer given just and reasonable cause for some form of discipline by the employer? If so, was the employer’s decision to dismiss the employee an excessive response in all of the circumstances of the case? Finally, if the arbitrator does consider discharge excessive, what alternative measure should be substituted as just and equitable?
[21] The above analysis applies not only to dismissal, but to all forms and degrees of discipline.
[22] The LRB has emphasized the statutory underpinnings of the concept of just cause in many decisions subsequent to Wm. Scott. In Forest Industrial Relations (on behalf of Bay Forest Products Ltd.) and International Woodworkers of America, Local 1-217, [1979] B.C.L.R.B.D. No. 69 [Bay Forest Products], the LRB distinguished at 3-4 between matters of contract interpretation and matters relating to the law of the Code, observing that the latter were susceptible to s. 99 review:
… [T]he determination of just cause for dismissal and the evidentiary preliminaries to such a determination, are a matter of general statutory concern; indeed, Section 93 [now s. 82] of the Code enshrines the concept of “just cause”. Thus the tests for just cause, the burden of proof, and the evidentiary requirements are more closely related to the “law of the statute” than the “law of the contract” ... For this reason, it is my opinion that this Board may review doctrinal approaches to matters relating to “just cause” for dismissal.
[23] Outside the context of employment, and absent a statutory requirement to the contrary, individuals have the right to choose whether to provide information that may be used against them in a criminal proceeding. The right to remain silent predates the Charter of Rights and Freedoms but is now entrenched as a constitutional right by s. 7 of the Charter: R. v. Turcotte, 2005 SCC 50, [2005] 2 S.C.R. 519 at para. 51; R. v. Singh, 2007 SCC 48, [2007] 3 S.C.R. 405 at para. 27.
[24] The right to protection against self-incrimination of an employee in a unionized workplace typically arises in the context of an investigation by an employer into allegations of workplace misconduct which are also, or may become, the focus of a criminal investigation or criminal proceedings. The issue is brought into focus when the employee refuses to answer questions put to him or her by the employer. The employer’s response is disciplinary action on the basis that the employee’s refusal to answer the questions amounts to insubordination. The employee grieves the discipline, and the issue before the arbitrator is whether the failure by the employee to provide answers to the employer’s questions is insubordination constituting just cause for discipline.
[25] There is a significant body of arbitral jurisprudence on the issue. One of the first arbitration decisions, Re Toronto East General Hospital Inc. and Service Employees International Union (1975), 9 L.A.C. (2d) 311 (Ont. Arb. BD.), is an example of the approach taken by many arbitrators. The arbitration board observed at 315-16 that each case must be decided on its specific facts:
…[W]here in the kinds of extreme circumstances where some explanation is properly and justifiably demanded by the employer, it must be recognized than an employee may in fact be liable to subsequent criminal prosecution and because a self incriminatory admission of guilt made to his employer might, in the proper circumstances, be used against him one must be circumspect that in obliging an employee to offer some explanation, one is not prejudicing his rights at the subsequent prosecution should it arise. In short to precisely define the circumstances under which an employee is obliged to offer some explanation for a set of circumstances and then to delineate what must be offered in that explanation which will satisfy that obligation is a task [fraught] with difficulty…. Suffice it to say then, for the reasons given, arbitrators should be cautious in establishing in the abstract the circumstances under which an employee owes an obligation of explanation to his employer and what the nature of that explanation must be. Whether an obligation of explanation in fact arises and what precisely the nature of the obligation is will vary dramatically with the facts of each case and accordingly each case ultimately must be determined on its own merits.
[26] It was not until the decision in Tober Enterprises Ltd. and United Food and Commercial Workers International Union, Local 1518 (1990), 7 C.L.R.B.R. (2d) 148 (BCIRC) [Tober] that the Industrial Relations Council (“IRC”), the predecessor to the LRB, squarely addressed the issue of an employee’s right to remain silent as a matter of law or policy under the Code.
[27] Tober involved the termination of an employee who had been charged with an offence under the Food and Drugs Act, R.S.C. 1985, c. F-27 following his sale to a police informant of substances thought to be anabolic steroids. Upon discovering that the employee had been charged with the offence, the employer, Tober, suspended him pending investigation. The employer invited the employee to explain his conduct. Because of the pending criminal charge, and on the advice of his legal counsel, the employee declined to comment. The employer then dismissed the employee for engaging in the sale of steroids during working hours.
[28] The Crown eventually stayed the criminal proceedings because the substances sold by the employee were not, in fact, anabolic steroids.
[29] The Union filed a grievance challenging the dismissal. At the arbitration hearing, the employee admitted that he had attempted on one occasion during working hours to sell a substance he thought was a steroid to the police informant, but denied any misconduct beyond the one occasion. The arbitration board accepted the employee’s evidence. It concluded that the employer had not established just cause for dismissal, and ordered that the employee be reinstated.
[30] However, the arbitration board imposed on the employee a suspension without pay from the time he refused to answer the employer’s questions until the date of the arbitration hearing at which he finally provided his explanation for the events leading to his dismissal. The Union appealed the suspension under s. 108 (now s. 99) of the Code.
[31] The employer argued as a preliminary matter that the decision of the arbitration board to substitute a lengthy suspension for the dismissal was not open to review under the Code because the arbitration board had properly engaged in the three-step process contemplated by Wm. Scott. It argued, in the alternative, that while the employee was entitled to remain silent in the face of the criminal charges, he continued to have a duty to explain his conduct to the employer and the consequence of failing to do so was the suspension imposed by the arbitration board.
[32] On the preliminary issue, the IRC panel in Tober held at 154 that its function was not to “criticize or endorse particular trends in arbitral jurisprudence unless the policies established by such authorities flow from the principles express or implied in the Act” (emphasis in original). Citing Bay Forest Products, the panel then concluded at 155 that the IRC was entitled to review the arbitration board’s ruling that an employee’s refusal to answer questions about a workplace matter constituted just cause for discipline:
Clearly, the identification of culpable employment offences is part of the “doctrinal” approach to matters relating to “just cause” for discipline.
[33] The IRC panel then turned to the question of whether the employee’s refusal to answer the company’s questions constituted just and reasonable cause for discipline. It concluded at 156 that, of itself, such conduct could not amount to just cause for discipline in most instances:
... [T]he Panel is satisfied a failure to explain misconduct, particularly where the employee also faces criminal or quasi-criminal charges, cannot amount to an independent cause for discipline. ... While the consequences of remaining silent may ultimately lead to dismissal, the failure to explain, standing alone, does not constitute just and reasonable cause for discipline. The failure to explain cannot be regarded as an offence which jeopardizes the employment relationship. It is the substantive misconduct alleged by an employer which must be proven on the balance of probabilities, with or without an explanation from the employee. Further, it is the proven substantive misconduct, and not the failure to explain, which constitutes just and reasonable cause for discipline or discharge. The failure to explain, without more, simply cannot be regarded as culpable behaviour.
[34] However, the panel in Tober went on to hold that the right of an employee to remain silent was not an absolute or unqualified right. In certain circumstances, said the panel, an employee may be disciplined solely for his or her refusal to answer the employer’s questions. The panel described two such circumstances at 156:
On the other hand, where an employee deliberately attempts to deceive his employer by a false or misleading explanation, the employee’s conduct is clearly blameworthy and threatens the basis of the employment relationship. The employee’s behaviour is equally blameworthy where he knowingly allows his silence to damage the legitimate business interest of the employer. Absent these kind of circumstances, however, an employee’s decision to remain silent when accused of wrongful conduct by his employer does not form a proper basis for the imposition of discipline.
[35] The panel acknowledged in the course of its reasons the recognition afforded by the common law to the right of an individual to remain silent in the face of a criminal investigation. In that regard, the panel said the following at 156-157:
Outside of the employment relationship, the law clearly limits the circumstances in which a person is obliged to explain his behaviour. The common law has never imposed upon a person a positive obligation to explain his conduct or disclose information about anyone unless summonsed as a witness to give evidence under oath. Where a person testifies in the course of any proceedings authorized by law, he may be compelled to answer questions; however, his answers cannot be used to incriminate him in any subsequent civil or criminal proceedings: see Evidence Act, R.S.B.C. 1979, c. 116; Canadian Evidence Act, R.S.C. 1985, c. C-5, and Canadian Charter of Rights and Freedoms. While some provincial and federal statutes compel those who contravene their provisions to make statements or reports concerning the circumstances of that contravention, such legislation generally prohibits the use of these statements in subsequent proceedings. Presumably, the law developed in this fashion because the courts recognized our society places significant importance upon the fundamental right to remain silent.
[36] With respect to the matter before it, the panel in Tober summarized its conclusions as follows at 159:
…[T]he Panel finds the identification of conduct which constitutes just and reasonable cause for discipline or discharge is a “matter of the statute” and the Council may therefore scrutinize the application of these principles under s. 108. Further, the Panel finds the arbitration board erred by concluding the Grievor’s silence, standing alone, gave Tober just and reasonable cause for some discipline.
[37] Tober remains the leading authority of the LRB on the issue of the right of an employee governed by the Code to remain silent about a workplace matter in the face of possible criminal proceedings.
[38] The parties agreed to the appointment of Arbitrator Brian Foley, an experienced labour arbitrator and mediator, to hear and determine the issue of whether the Company had just cause to discipline Mr. Lilgert and Mr. Hilton.
[39] Arbitrator Foley convened the arbitration hearing and heard evidence and argument concerning the grievance. He then provided counsel for the parties with his draft findings of fact concerning the background to the grievance. Following input from counsel and revisions by the Arbitrator, the parties agreed that the facts as drafted accurately reflected the evidence.
[40] The following are the key undisputed background facts as found by the Arbitrator.
[41] Mr. Hilton was the 2nd Officer of the Queen of the North; Mr. Lilgert was the 4th Officer. As navigational crew members, the two men were responsible for bridge watch on March 21 and 22, 2006. Mr. Lilgert was on the bridge and had control of the vessel during the period of time immediately before the vessel’s grounding. Mr. Hilton had control of the vessel earlier and had handed control to Mr. Lilgert.
[42] The RCMP initiated a criminal investigation into the matter of the two missing passengers. The investigation included all aspects of the incident with a view to possible charges for criminal negligence.
[43] The Transportation Safety Board (the “TSB”) commenced an investigation into the accident. Mr. Hilton and Mr. Lilgert were interviewed, and answered all questions put to them by the TSB investigators. The evidence they gave in the interviews was privileged and confidential by virtue of the provisions of the Canadian Transportation Accident Investigation and Safety Board Act, S.C. 1989, c. 3, s. 7.
[44] The two employees were also interviewed by solicitors retained in respect of the Company’s insurance claim for the loss of the vessel. They answered all questions put to them by the solicitors. Litigation privilege was claimed over the minutes of evidence prepared following the interviews and those minutes have not been disclosed.
[45] The Company’s Fleet Regulations Policy and Procedures Manual stipulates that an internal inquiry known as a Divisional Inquiry must be convened to investigate the most serious of safety-related incidents. The Company established a Divisional Inquiry Panel in April 2006, and directed the crew members of the Queen of the North to attend. The criminal investigation was ongoing at the time. Several crew members retained independent legal counsel, who requested that the Divisional Inquiry be adjourned until the RCMP concluded its investigation and determined whether criminal charges would be laid.
[46] The Company declined the request to adjourn the Divisional Inquiry and proceeded with the interviews.
[47] Mr. Hilton and Mr. Lilgert attended before the Divisional Inquiry Panel in April and May 2006. They answered all questions put to them about the period of time from the commencement of the vessel’s voyage until it entered the waters of Wright Sound approaching Gil Island. They also answered all questions about the period of time from the vessel’s grounding off Gil Island to its sinking, including the evacuation of crew members and passengers.
[48] On the advice of legal counsel, the two employees refused to answer any questions concerning the critical period from the vessel’s entry to the waters approaching Gil Island until the time of its impact and grounding.
[49] In July 2006, legal counsel for Mr. Hilton and Mr. Lilgert advised the Company that the two employees would re-attend the hearing and answer questions about the critical period if they were assured by the Company that their evidence would, in the words of counsel, be “privileged, kept confidential, and not deemed compellable in any other proceeding” (Arbitration Award at 172). The Company refused to provide the assurance on the basis that it would “fetter the ability of the Divisional Inquiry Panel to carry out its obligations or functions in conducting the Inquiry” (Arbitration Award at 172).
[50] By letter dated July 24, 2006, the Company advised Mr. Hilton and Mr. Lilgert they would be suspended without pay until they responded to the questions of the Divisional Inquiry Panel. The letter states, in part, the following:
Your continued refusal to cooperate is considered serious misconduct that can have an extremely adverse impact on the Company’s business interests. In particular, the Company’s responsibility for the safety of the travelling public using the BC Ferries’ system makes it imperative that all employees account for what transpired in an event such as this.
(Arbitration Award at 173)
[51] The Union grieved the suspensions on a number of grounds. It argued, among other things, that the Company did not have just cause for discipline because the employees were entitled to remain silent about their conduct in the face of potential criminal charges. The Union relied on the Tober decision and numerous arbitral authorities. It also argued that the Company’s refusal to provide assurances concerning privilege and confidentiality was unreasonable in light of various judicial authorities recognizing the importance of the protection against self-incrimination.
[52] The Company also relied on the Tober decision, arguing that while an employee’s refusal to explain his or her conduct in the face of possible criminal proceedings does not usually constitute just cause for discipline, the sinking of the Queen of the North was an exceptional circumstance. It argued that the failure of the two crew members to explain their conduct in the critical period of time before the sinking of the vessel damaged the legitimate business interests of the employer, one of the exceptions to the general rule as articulated in Tober.
[53] Arbitrator Foley characterized the issue before him as follows:
The question before me is whether, given all the attendant circumstances, the Company’s action of holding the two employees out of service without pay was an appropriate and not excessive response to their continued refusal to testify in person before the Divisional Inquiry about the critical period without having their testimony protected by privilege.
(Arbitration Award at 179)
The Arbitrator then identified a related issue as follows:
Did Messrs. Hilton and Lilgert reasonably have the right to remain silent before the Divisional Inquiry about everything that occurred during the critical period in light of the possibility of criminal charges being pursued against them later on for their conduct during the sailing on March 21-22, 2006?
(Arbitration Award at 180)
[54] The Arbitrator made the following findings:
The Divisional Inquiry’s legitimate public purpose and responsibility to the ferry-travelling public of British Columbia is to determine the cause or causes of the March 21-22, 2006 incident and take whatever action is necessary to ensure that further incidents of this nature are prevented.
...
The two employees’ refusal to provide the Divisional Inquiry with any information about the critical period has to be balanced against the Company’s legitimate business interests in obtaining their testimony about the critical period and then making public its complete report.
As stated in Tober Enterprise, supra, an employee’s right to remain silent can be abrogated if the surrounding circumstances and the nature of the employer’s business interests favour the employer’s right to require an explanation for what occurred when the employee was carrying out his/her job duties. Whether an employee’s obligation to provide such an explanation in fact arises and the nature of the obligation will vary dramatically with the facts of each case and accordingly each case ultimately must be determined on its own merits. (Canex Placer Ltd. and C.A.I.M.A., Loc. 17 (1978), 21 L.A.C. (2nd) 127, (Weiler)).
...
In this case, the grounding and sinking of the Queen of the North was a tragic incident, resulting in the presumed death of two passengers. The incident was the subject of enormous media attention and widespread public speculation on the safety and operational effectiveness of the B.C. Ferries system. The Company, through the Divisional Inquiry, has very legitimate business reasons and public purpose for its desire to have all information about all the events that occurred during all the time before the vessel’s grounding. Messrs. Hilton and Lilgert had primary responsibility for navigation of the vessel and the information they have about the events and circumstances during the critical period before the vessel’s grounding is crucial to the Divisional Inquiry’s ability to complete its investigation and issue a full and complete public report.
(Arbitration Award at 182-83; emphasis original)
[55] Arbitrator Foley accepted that Mr. Hilton and Mr. Lilgert had a reasonably-held concern that the evidence they gave to the Divisional Inquiry might be used in subsequent legal proceedings. Nevertheless, he concluded that the obligation of the Company to make “full public disclosure” of the incident outweighed the interests of the employees:
…[T]he business interests of the Company to obtain and make public all information about the causes of the sinking of the Queen of the North far outweigh possible future repercussions on the two employees. Therefore, I have concluded that the Company acted reasonably by refusing to grant privilege protection respecting the two employees’ testimony before the Divisional Inquiry because the very public nature of the Inquiry involves the essence of the Company’s mandate and dictates that all information and testimony must be fully and openly disclosed.
In summary, after considering all the circumstances involved and the jurisprudence referred to by the parties, I have concluded that the two employees’ declared right to remain silent about events that occurred during the critical period is outweighed by the Company’s legitimate entitlement to have all available information about what occurred during all the time of the vessel’s voyage so that it can make a full public disclosure on the incident.
(Arbitration Award at 184)
[56] The Union applied to the LRB under s. 99 of the Code on the basis that the alleged error committed by the Arbitrator involved a principle expressed or implied in the Code. The Union identified the principle of the Code as that articulated in Tober: An employee’s silence, standing alone, cannot give an employer just and reasonable cause for discipline.
[57] The Union argued that the Arbitrator misapplied the principle articulated in Tober by concluding that the Company’s demand for the employees’ evidence constituted a business interest that overrode the employees’ right to protection from self-incrimination. The facts of the grievance, submitted the Union, fell well short of any exception to the general rule established by Tober.
[58] The Company argued that the Arbitration Award was consistent with the law and policy of the Code as expressed in Tober, and that the Union had failed to meet the standard of review for s. 99 applications.
[59] LRB Vice-Chair Bruce Wilkins dismissed the Union’s application. He held that the arbitrator reasonably concluded the extraordinary facts of the case fell within an exception to the general rule in Tober.
[60] The Vice-Chair observed at paras. 20-22 that the legitimate business interest harmed by the employees’ silence, as identified by the Arbitrator, was the Company’s obligation to issue a “full and complete public report”:
From reading the Award it is clear that the Arbitrator felt there was a larger public interest at stake which was the responsibility of the Employer to meet through completing and releasing a full public report. ... Determining what constitutes an Employer’s legitimate business interest when applying Tober is a finding of fact which an arbitrator must make. The Board has a policy of deference to an arbitrator’s findings of fact and the Union has not established in its argument that I should depart from that policy.
…. The Union’s argument that the Employer’s legitimate business interests could have been satisfied through privileged and confidential information from [Hilton and Lilgert] does not address the Arbitrator’s conclusion that [Hilton and Lilgert’s] full testimony was required to satisfy the Employer’s legitimate business interest in rendering a full and complete public report. From reading the Award it is clear that the Arbitrator concluded that receiving privileged and confidential information … concerning the critical time of the sinking of the Queen of the North would not allow the Employer to issue a full and complete public report[.] …
On the exceptional facts of this case it was reasonable for the Arbitrator to find that [Hilton and Lilgert’s] refusal to testify fit within an exception to the general rule in Tober. ... Accordingly I reject the Union’s argument that the Award raises no exception to the principle in Tober. The Union has not established a palpable and overriding error in the Arbitrator’s finding.
(Emphasis added)
[61] The Union sought leave for reconsideration of the Original Decision under s. 141 of the Code. In its written application for leave, the Union submitted that the Arbitration Award and the Original Decision upholding the Award were contrary to the “the law and policy of the Code and the long standing approach of this Board, arbitrators, and the courts”, and contrary to the “fundamental right to remain silent in the face of a police investigation”.
[62] A three-member panel of the LRB (Chair Brent Mullin, Associate Chair Michael Fleming and Vice-Chair Lisa Southern) summarily dismissed the application for leave on the basis that it did not disclose a “good, arguable case of reviewable error” by the Original Panel (Leave for Reconsideration Decision at para. 1).
[63] It was common ground among the parties that because the Leave for Reconsideration Decision simply denied leave to apply for reconsideration of the Original Decision, it is the Original Decision of the LRB that is effectively under judicial review.
[64] I have summarized, as follows, the arguments of the Union in support of its application for judicial review:
(a) The LRB, in its Original Decision, committed an error of law concerning the rights of employees who are compelled by their employer under threat of discipline to provide potentially self-incriminating testimony in the face of a criminal investigation. The right to silence is a question of general law, having its roots in the criminal law and the Charter, and the appropriate standard of review is therefore correctness; and
(b) The LRB, in its Original Decision, deferred to the Arbitrator’s finding that a legitimate business interest of the Company was to issue a full and complete public report. The deferral of the LRB to that finding was patently unreasonable because there was no evidence on the record to support it.
[65] A summary of the Company’s response to the Union’s arguments is as follows:
(a) The question before the Arbitrator was whether the employees’ refusal to provide information to their employer was insubordination constituting just cause for discipline. The LRB concluded that the Arbitration Award was consistent with the principles of the Code. That decision is a matter within the exclusive jurisdiction of the LRB and is not patently unreasonable; and
(b) The Arbitrator found as a fact that the obligation of the Company, through the Divisional Inquiry, included issuing a full and complete report to the public concerning the events surrounding the sinking of the Queen of the North. The deferral of the LRB in its Original Decision to the Arbitrator’s finding was not patently unreasonable.
[66] As noted earlier, the first issue concerns the appropriate standard of review. The second issue is whether, applying that standard, the Original Decision ought to be set aside.
[67] The decisions of the LRB are protected by a privative clause: s. 138 of the Code.
[68] Section 115.1 of the Code stipulates that ss. 58(1) and (2) of the Administrative Tribunals Act, S.B.C. 2004, c. 45 (the “ATA”) apply to decisions of the LRB. Those provisions state as follows:
58(1) If the tribunal's enabling Act contains a privative clause, relative to the courts the tribunal must be considered to be an expert tribunal in relation to all matters over which it has exclusive jurisdiction.
(2) In a judicial review proceeding relating to expert tribunals under subsection (1)
(a) a finding of fact or law or an exercise of discretion by the tribunal in respect of a matter over which it has exclusive jurisdiction under a privative clause must not be interfered with unless it is patently unreasonable,
(b) questions about the application of common law rules of natural justice and procedural fairness must be decided having regard to whether, in all of the circumstances, the tribunal acted fairly, and
(c) for all matters other than those identified in paragraphs (a) and (b), the standard of review to be applied to the tribunal's decision is correctness.
[69] In the recent decision of Dunsmuir v. New Brunswick, 2008 SCC 9, [2008] 1 S.C.R. 9, the Supreme Court of Canada revisited its earlier jurisprudence on the issue of standard of review. It held that at common law, there are now only two standards of review, correctness and reasonableness. However, as I read Dunsmuir, it did not purport to override legislated standards of review such as those provided in the ATA. In any event, the Court in Dunsmuir emphasized that labour boards with privative clauses such as that contained in the Code continue to be owed the highest judicial deference.
[70] The question remains whether the circumstances of the present case engage paragraph (a) of s. 58(2), or paragraph (c).
[71] I have concluded that the issue before the Arbitrator, which remained the issue before the LRB in the application for review, was not whether employees have the right to remain silent at common law or under the Charter. The Union did not argue that the employees’ common law or Charter rights were engaged. The issue, as framed by both parties, was whether an employee’s silence in the face of questioning about a workplace incident is insubordination constituting just and reasonable cause for discipline. That is an issue governed by s. 84(1) of the Code, and within the jurisdiction of an arbitrator to determine.
[72] The task of the LRB under s. 99 of the Code was to determine whether the arbitrator’s application of the just cause standard was inconsistent with the principles, expressed or implied, in the Code, and, more specifically, the principles established by the LRB in Tober. That is a matter of law or policy under the Code which lies at the heart of the exclusive jurisdiction of the LRB.
[73] In the result, s. 58(2)(a) is engaged, and the standard to be applied in the review of the Original Decision is one of patent unreasonableness.
[74] I emphasize that it is the reasoning of the Vice-Chair on the s. 99 review application that must be assessed here, not the reasoning or underlying merits of the Arbitration Award. The question is whether the Original Decision, which was a review of an arbitrator’s decision, was patently unreasonable or clearly irrational: Terasen Gas Inc. v. Office & Professional Employees’ International Union, Local 378, 2005 BCSC 123.
[75] In its s. 99 application for review, the Union argued that the Arbitrator had misconstrued or misapplied the principles established by the LRB in Tober. In response to that argument, the Vice Chair in the Original Decision examined the Tober decision. He observed that the general rule in Tober is not absolute, and in circumstances falling within one of the exceptions, the refusal to provide answers to an employer’s questions may constitute an independent ground for discipline.
[76] Reviewing the Arbitration Award as a whole, the Vice-Chair was satisfied that the Arbitrator reasonably concluded the employees’ refusal to answer questions about the events immediately prior to the grounding of the vessel frustrated the public purpose of the Divisional Inquiry and damaged the legitimate business interests of the Company. Describing the circumstances of the case as “exceptional”, the Vice-Chair held that it was open to the arbitrator to find the employees’ refusal to testify fell within one of the exceptions to the general rule in Tober. In the result, the Vice-Chair concluded the Arbitration Award was consistent with the principles of the Code.
[77] On the application for judicial review, the focus of the Union’s argument was not the reasoning contained in the Original Decision. Instead, the Union challenged the law and policy underlying Tober. The Union sought to persuade this Court that the exceptions to the general rule in Tober effectively negate the right of employees to remain silent without fear of discipline for insubordination. In the words of counsel for the Union, “the exceptions [in Tober] swallow the rule”.
[78] I have concluded that the Union’s argument cannot succeed for two reasons.
[79] First, in its s. 99 application the Union did not ask the LRB to modify the law and policy of the Code as established in Tober. Nor did it argue that the employees’ common law or Charter rights were violated. Instead, it argued that the Arbitrator had erroneously applied one of the exceptions articulated in Tober. The LRB cannot be faulted for failing to address an argument that was not made to it.
[80] Second, the scope of an employee’s right to remain silent without fear of discipline for cause is a matter of law and policy of the Code. It is within the exclusive jurisdiction of the LBR to determine whether re-examination of its approach in Tober is warranted. It is not a matter for this Court to embark upon.
[81] I make one further comment on the Union’s argument. There is no suggestion in either the Arbitration Award or the Original Decision that any business interest of an employer, however mundane or marginal, will be sufficient to negate the general rule in Tober. Arbitral jurisprudence to which I was referred suggests otherwise. It can hardly be disputed that the circumstances of the present case were extraordinary. A ferry carrying members of the public grounded and sank in waters routinely travelled by vessels of the Company. Two passengers lost their lives. The evacuation of the remaining passengers and crew was harrowing. The vessel could not be recovered. In the circumstances, the Company had an obligation to account for the tragedy to the public as quickly as possible. It required the co-operation of the crew members – and, in particular, the navigational crew – to fulfill that obligation. On those facts, the arbitrator’s decision to apply the exception in Tober was not the pro forma application suggested by the Union.
[82] The Original Decision on this issue is not patently unreasonable. Nor, if the common law standard of reasonableness applies, is it unreasonable.
[83] The Union advanced a second argument on judicial review. It submitted the Vice-Chair erred in concluding there was evidence before the Arbitrator establishing that the Company had an obligation to issue a public report concerning the loss of the Queen of the North.
[84] I have concluded this argument must also fail.
[85] As noted by the Vice-Chair in the Original Decision, the Arbitrator found as fact that the Divisional Inquiry was of a public nature and the mandate of the Divisional Inquiry included the completion of a report that would be made available not only to the Company but to the public. The Company’s regulations, which were considered by the Arbitrator, implicitly if not expressly, contemplate distribution of the findings of the Divisional Inquiry to the media and other members of the general public. The public had a significant interest in knowing the cause of the accident and the remedial steps proposed by the Company to ensure such an accident did not occur again.
[86] The employees were clearly alive to the fact that the report of the Divisional Inquiry would be publicly disseminated, hence their efforts to obtain the Company’s assurance that their evidence concerning the critical period of time would be held in confidence.
[87] Further, the role of the Vice-Chair in the Original Decision was not to engage in fact-finding but to review the Arbitration Award. Whether or not the arbitrator made findings of fact unsupported by the evidence was a matter within the exclusive jurisdiction of the Vice-Chair to determine, which he did determine. The role of this Court is to determine whether there is a rational basis for the Vice-Chair’s decision.
[88] The Vice-Chair was satisfied that the arbitrator concluded there was a “larger public interest at stake” which was the responsibility of the Company to address by completing and releasing a full public report (Original Decision at para. 20, reproduced above). The Vice-Chair’s reasoning with respect to the matter is rational as it is based on the record that was before the Arbitrator. As such, the Original Decision cannot be disturbed on judicial review.
[89] My conclusions are the following:
1. The appropriate standard of review of the Original Decision is patent unreasonableness;
2. The Original Decision is not patently unreasonable and should not be set aside.
[90] The application for judicial review is dismissed. In the event that no agreement is reached as to costs, the parties may speak to the issue.
The Honourable Madam Justice C. A. Wedge