Canada v Munsee-Delaware Nation

The Federal Court released a decision on March 23, 2015 in Canada (Attorney General) v. Munsee-Delaware Nation, granting two applications for judicial review against a decision of an adjudicator appointed under the Canada Labour Code that he had no jurisdiction over a labour dispute between the Munsee-Delaware Nation and its former employee.


Crystal Flewelling is a member of the Munsee-Delaware Nation and worked in the Nation’s administration offices from 2001 until she was terminated in 2006. Flewelling filed a complaint for unjust dismissal against the Nation under s. 240 of the Canada Labour Code, which resulted in an adjudicator being appointed to hear her complaint. In May 2013, after six years of proceedings before the adjudicator were nearing an end, the adjudicator accepted the Nation’s assertion that he had no jurisdiction to consider Flewelling’s complaint because her employment was provincially regulated, based on the Supreme Court of Canada’s 2010 ruling in NIL/TU,O Child and Family Services Society v. B.C. Government and Service Employees’ Union. Both Flewelling and the Attorney General of Canada sought judicial review of that decision.

Court’s decision

While the Constitution Act, 1867 is silent as to whether labour relations fall within provincial or federal jurisdiction, Canadian courts have historically recognized this subject matter as being “presumptively of provincial jurisdiction” based on the provinces’ Property and Civil Rights head of power. The federal government, however, has jurisdiction over labour relations for entities that constitute a “federal work, undertaking or business”. There is a two-step analysis to determine whether a work, undertaking or business’s labour relations are federally or provincially regulated: 1) the Court must inquire into the nature, habitual activities and daily operations of the entity to determine if it is a federal work, undertaking or business; and 2) if the first step is inconclusive, then the Court must inquire into whether provincial regulation of the entity’s labour relations would impair the core of a federal head of power.

The Court noted that success in these applications would turn on whether or not the 1981 Federal Court of Appeal decision in Francis v. Canada Labour Relations Board remained good law in light of the Supreme Court of Canada’s 2010 ruling in NIL/TU,O. Francis established that bands and band councils are federal undertakings for the purpose of labour relations when they are engaged in activities under the authority of the Indian Act and concerned with the “status and rights and privileges” of band members. NIL/TU,O, on the other hand, dealt with a case where the employer was a society incorporated under British Columbia’s Society Act by several First Nations in that province to establish a “culturally sensitive” child welfare agency. This society was exclusively regulated by the province and its employees exclusively exercised provincial delegated authority. The only federal involvement in the society’s activities was funding it along with the province. The Supreme Court of Canada found that although the society was created for Aboriginal communities it remained an agency that was “in all aspects regulated by the province” and its function was “unquestionably a provincial one”.

The Court found that Francis remained good law and the adjudicator’s reliance on NIL/TU,O was a reviewable error. In this case the employer was a band council to which the Indian Act applies and Flewelling was engaged in the general administration of the band’s affairs, including on-reserve housing and matters concerning reserve lands. Flewelling’s salary was also paid out of federal monies that made up the main share of the Nation’s funding. The Court held that the adjudicator erred in failing to analyse the core functions of bands and band councils as had been done in Francis.

The Court found that the Nation’s assertion that it is not subject to the regulation of federal laws such as the Indian Actbecause it has an inherent authority to govern that is recognized by s. 35 of the Constitution Act 1982 had no bearing on the outcome of this case. It accepted the applicants’ argument that the Nation’s right to self-government needed to emanate from either a negotiated self-government agreement or a judicial declaration in order to be legally enforceable. The Court also held that in order to be asserted in litigation, the Nation’s self-government right had to be “characterized in context and with sufficient specificity to allow a court to identify a practice, custom or tradition that is integral to the distinctive culture of the First Nation asserting that right”. The Nation had not adduced any evidence to support a finding of an inherent right to govern and had not established or asserted any such right before the adjudicator. The Court also held that although First Nations do not owe their existence to the Indian Act or any other statute and a band is more than a creature of statute, they nevertheless constitute entities that are regulated by the Indian Act and exercise powers in accordance with it.

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