Canada Labour Code Does Not Grant Non-Unionized Employees A 'Right To The Job'

In Wilson v. Atomic Energy of Canada Limited, 2015 FCA 17 ("Wilson"), the Federal Court of Appeal (FCA) made a game-changing decision when they unanimously found that without-cause dismissals of non-unionized employees are permissible under Part III of the Canada Labour Code (the Code).1 Previously, adjudicators had been split into two camps: some held dismissals without-cause to be inherently unjust, and some deemed them to be just provided that reasonable notice (or wages in lieu) and severance under the Code was given.

On November 16, 2009, Mr. Joseph Wilson was dismissed without cause from his employment with Atomic Energy of Canada Limited (AECL). As a federally-regulated employer, AECL is governed by the Code. Prior to dismissal, Mr. Wilson had been working at AECL for four and a half years. AECL offered a severance package equal to roughly six months' pay in exchange for a full and final release, despite the fact that under the Code Mr. Wilson was entitled to only 18 days severance pay. Mr. Wilson did not sign the release. Instead, he alleged that he had been unjustly dismissed contrary to section 240(1) of the Code.

The adjudicator ruled that the Code does not permit without-cause dismissals, and held Mr. Wilson's without-cause dismissal to be inherently unjust. The FCA upheld the Federal Court's finding that a dismissal without cause is not on its face unjust if reasonable notice (or wages in lieu) and severance is given. Instead, it will always be for the adjudicator to assess all of the circumstances and determine if the dismissal, whether or not for cause, was unjust.

In reaching their decision, the FCA relied on the common law of employment. At common law, an employer can dismiss a non-unionized employee without cause so long as it provides reasonable notice of termination or compensation in lieu. In creating statutes, such as the Canada Labour Code, Parliament can only oust the common law by way of explicit language or necessary implication.

The FCA found that the Code was enacted against the backdrop of the common law and, as such, does not override it. The FCA held that there is nothing in the Code that suggests that it was the intention of Parliament to grant non-unionized employees a "right to the job", or to place them in the same position as non-unionized employees whom cannot be dismissed without cause.

Mr. Wilson has sought leave to appeal to the Supreme Court of Canada (SCC). If the SCC accepts to hear the case, we...