On Feb. 12, 2024, the Ontario Court of Appeal released its landmark decision in Ontario English Catholic Teachers' Association v. Ontario (Attorney General), 2024 ONCA 101. The Court of Appeal upheld a Superior Court ruling that Bill 124, the Protecting a Sustainable Public Sector for Future Generations Act, 2019, was unconstitutional - but only insofar as it applied to unionized workers.
This ruling follows on the heels of a 2.75 per cent compensation increase for certain Ontario teachers as a result of the Superior Court's ruling, set out in a Feb. 9, 2024 interest arbitration award by Arbitrator William Kaplan: The Crown in Right of Ontario v The Ontario Secondary School Teachers' Federation and The Elementary Teachers' Federation of Ontario, 2024 CanLII 8967 (ON LA).
Key takeaways
- Bill 124 was a wage-restraint statute which limited compensation increases to one per cent for each 12-month period during a three-year "moderation period" for unionized and non-unionized public sector employees, including teachers and other school board employees.
- On Nov. 29, 2022, the Superior Court of Justice struck down Bill 124 as unconstitutional, on the basis that it unlawfully interfered with the freedom of association by limiting employees' ability to engage in collective bargaining rights and strikes.
- Following the Superior Court decision, on Feb. 9, 2024 Arbitrator William Kaplan awarded a 2.75 per cent compensation increase for the 2021-2022 school year for public school teachers represented by ETFO and OSSTF.
- On Feb. 12, 2024, a 2-1 majority of the Ontario Court of Appeal upheld the Superior Court's ruling that Bill 124 was unconstitutional, but only insofar as it applied to represented (unionized) employees.
- Justice Hourigan dissented, suggesting that the majority were second-guessing the Ontario government's legitimate policy decisions.
- The Ontario government will not appeal the decision to the Supreme Court of Canada, and will instead repeal Bill 124 in its entirety.
Background
Bill 124 was legislation that imposed a one per cent cap on wage increases for the public sector. The government introduced it on June 5, 2019, and it received Royal Assent on Nov. 7, 2019. It applied to both union and non-union employees in the broader public sector, including school boards.
Bill 124 imposed a mandatory three-year "moderation period" for almost all non-executive employees of school boards. Bill 124 did not apply to "designated executives" within the meaning of the Broader Public Sector Executive Compensation Act, 2014, such as Directors of Education and Supervisory Officers (Superintendents), who are subject to the salary freezes in that legislation.
During the moderation period, employees' salary rates could not increase by more than one per cent for each...
