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Can Canadian Labour Law Fuddle Up NHL’s Lockout Plan?

There’s been a flurry of news reports this week about the impending NHL lockout, which is legal (in most locations at least) as of September 15th.  I have a no inside scoop here, so all I know is what I’ve read in the papers.  Nor am I any great expert in sports law. But since students are usually interested in this stuff, let’s try to recap some of the basic issues.  Comments and corrections welcome.

The Basic Bargaining Structure

The parties have been bargaining slowly, but are still far from a deal.  Collective bargaining in these major North American sports leagues take place primarily under American law and the National Labor Relations Act.  Under that law, the NHL is in a position to lockout the players as of September 15th.  The interesting thing about pro sports leagues though is that there are really multiple employers, and sometimes multiple unions or at least branches of the main players union.  When there are teams from two countries, things can start to get complicated.

In 1967, the NHL “voluntarily recognized” the NHLPA as a union representing NHL players.  Since then, the two parties have bargained a

Gary Betman Leading NHL to Another Lockout?

series of collective agreements (CBAs).  The ‘recognition clauses’ explain that the CBA covers all NHL players employed by NHL clubs, and is binding on the NHL, the NHLPA, the Clubs, and the players.  The NHL is described as the exclusive bargaining agent of the NHL clubs.  The players then negotiate individual employment contracts with their Clubs, but the terms of those contracts must not conflict with the CBA.

Now, as a general rule, the laws of the jurisdiction in which employment takes place govern the employment relationship.  So, if you play for the Toronto Maple Leafs or Montreal Canadians, your employment is governed by the laws of Ontario and Quebec respectively. For the purposes of labour law, which is the laws that govern collective bargaining and strikes and lockouts, the provincial labour relations statutes govern.  Sometimes, this simple legal fact creates difficulties for pro sports.  In both Baseball and Basketball, for example, the Ontario Labour Relations Board has ruled that a lockout which is legal under American law is illegal under Ontario law.  That’s because in order for a lockout to be legal here, the employer must first hop through a series of legal hoops, including mandatory government conciliation.  Major League Baseball and the NBA ignored those requirements, assuming that American labor law applied.  It did not, with the result that they were ordered not to use replacement officials in games played in Toronto.  I noted recently that the NFL would be in the same situation if their lockout of referees is not over by the time the Buffalo Bills play their first game in Toronto in December.  The NHL situation is different, though, since it is the players who are being locked out.  Without players, there will be no games at all.

The Current NHL Situation

The media is reporting that the Montreal Canadians and the two teams in Alberta are bringing complaints to the respective labour boards seeking orders that a lockout out of the players would be unlawful under those province’s labour laws. Unlike the NBA and MLB, the NHL

Can the Canadiens Be Locked Out?

has been alert to the requirement to comply with provincial labour laws.  So it appears that it did hop through the legal hoops in Ontario, having received conciliation and then a ‘no board’ report from the Minister of Labour, which makes a lockout lawful in Toronto and Ottawa.  I’m not sure of all the details of how this happened, but I’d note that in Ontario, a ‘voluntary recognition’ is sufficient to access the conciliation processes and to get the parties to a legal strike or lockout position (see Section 18(3) of the Labour Relations Act).  I assume that the NHL and/or the Leafs/Senators requested and obtained conciliation in this way.

In 2007, the BC Labour Board rejected an application by Vancouver Canucks players to certify a BC only branch of the NHLPA.  If successful, that would have required the Canucks owners to bargain with the BC union under BC labour laws, and would make a league wide lockout illegal as it applied to the Canucks players.  However, the Board found that the NHLPA represented Canuck players under the NHL wide bargaining structure, and that it would be disruptive to that structure to start certifying team-based bargaining units.  Here is that decision.

The issues this time involve the teams in Quebec and Alberta, but for different reasons.  As I understand the media reports, the Canadians are arguing that under Quebec law, a lockout is only permitted when the workers belong to a union certified under Quebec labour law.  The argument I assume is that the NHLPA is not a union certified under Quebec law.  I assume further that, unlike in Ontario, the voluntary recognition between the NHLPA and the NHL does not satisfy the requirements for access to conciliation and the right to lockout, so that a lockout of the Canadiens would be unlawful.  [Interestingly, I think the Canadiens players attempted to certify a Quebec only bargaining unit at the same time the Canuck players were trying that strategy, but the application was dropped when a new CBA agreement was concluded at the league level.  In that application, the NHL took the position that a Quebec only bargaining unit was inappropriate.  In fact, I think the NHL filed a complaint with the NLRB in the U.S. arguing that the Quebec and B.C. applications constituted bad faith bargaining under the NLRA.]

I take the Alberta challenge to be more straightforward:  that the NHL has not hopped through the legal hoops necessary under Alberta labour law to obtain the legal right to lockout the Flames and Oilers players.  I assume the NHL could try to satisfy those requirements, but that would probably take longer than the September 15th lockout date. If anyone has more details about the Quebec or Alberta challenges, I’d love to hear about it.

What Would Successful Labour Board Proceedings Mean?

An interesting question is what happens if the challenges succeed.  In Quebec, I assume that the player’s argument is that there is no union representing the Canadiens’ players under Quebec law.  That would make a lockout unlawful.  But what does that mean?  If the Canadiens are not unionized, then I presume they are governed by their individual employment contracts and by contract and employment laws of Quebec. Does that mean that the Canadiens players, unlike the players on the teams involved in the lockout, cannot take up jobs on other pro hockey teams during the lockout?  That would seem to follow if their contract prohibits them from working for another hockey team, which I assume it does.  Last lockout, players went to Europe to keep in shape and earn some pocket money.  They could do that because their contracts with the NHL clubs ceased to govern them during a lockout.  Right?  But if the Canadiens are not unionized, and they are not locked out, and their contracts are still in effect, wouldn’t that stop them from skating for any other team? Anyone?

I don’t know what the individual Flames, Oilers, and Canadiens player contracts say about the possibility of a league wide shut down cancelling all games.  The contracts are for a fixed term, but is there anything in there that contemplates a temporary layoff during that term if for some reason the NHL is shut down?  Are layoffs permissible with fixed term contracts under Quebec laws (I don’t know the answer to that)? Do the contracts contemplate that the employer will just keep paying the workers even though there are no games?  Do the contracts require the employer to maintain the ice, pay maintenance staff, and hold practices when the rest of the league is engaged in a work stoppage?  All interesting legal questions.  Any sports lawyers or law profs with Quebec employment law expertise have answers?

And now a Tale from the History of Labour Law

In the end, I suspect these labour board complaints won’t have much impact on the outcome of collective bargaining.  But they certainly raise some very interesting labour law issues that flow from the multi-jurisdictional nature of pro sports.  As a final side note, one of Canada’s great all time labour law professors, Paul Weiler, became one of America’s top voices on sports collective bargaining during his time at Harvard.  He got into sports law when one of his students asked him to supervise his LLM thesis on anti-trust law as applied to the NHL.  That student was current Leaf’s GM Brian Burke.


5 Responses to Can Canadian Labour Law Fuddle Up NHL’s Lockout Plan?

  1. Tyler Reply

    September 11, 2012 at 2:20 pm

    You should take a look at the SPC, which is an exhibit to the CBA. It answers a lot of the questions that you have about what the players can and can’t do if their contracts are valid and they aren’t locked out. My take from it is that Montréal would be stuck paying their players, or risking their players seeking declarations that their contracts are void. While the Habs might be fine with that in the case of Scott Gomez, they probably have a lot of other players who they don’t want walking away from their contracts.

    Then again, Montréal finished 28th last year, so maybe not.

  2. Howard Lawless Reply

    November 21, 2012 at 6:08 pm

    Can I assume from this article that the Collective Bargaining Agreement between the NHL and NHLPA is NOT under the legal umbrella of one defined jurisdiction in the United States or Canada. If so when a CBA expires is the NHL under no obligation to enter into a new CBA and can proceed to conduct its business affairs as it see fit? This assumes the NHL obeys the general laws of the jurisdictions where it plays games. Is it just a contract that one or the other party can decide not to renew when it expires and that is it? Seems to me that contract law in most jurisdictions supports just that supposition. You do not have to renew!

    • Doorey Reply

      November 22, 2012 at 12:42 pm

      Thanks for the comment Howard. There is a difference from non-labour contract law, because it is governed by the laws of collective bargaining. That means there is a duty to bargain in good faith that does not exist in other commercial settings. But that duty is limited, and you are right that there is no legal duty to enter into a new collective agreement with the players unions, and the NHL employers could just decide to walk away and not renew. Of course, that would mean the end of the league and the revenues that go with it.

  3. Howard Lawless Reply

    November 22, 2012 at 8:43 pm

    I am not sure why the decision to not renew would mean the end of the league. The teams have arenas to play in (some teams own the arenas)and most teams have players under individual contracts that were negotiated independently which they would be obliged to honour. The league could easily establish a schedule of games with all of the normal factors of competition in place and could agree themselves on a method of attracting players to play under rules that are mostly in place now, with modifications to suit the new circumstances of the way they wish to do business. The revenues are an unknown factor I agree, but there is an appetite for hockey in Canada and in hockey towns in the northern tier of the United states, enough to open up access to substantial amounts of dollars for ticket sales and TV rights. Admittedly, the ancillary revenue streams would take time to rebuild but operating a league with a schedule of games should permit the NHL to put its financial house in order with out legal interference from third parties. Don’t understand why the NHL would be put out of business by not renewing a collective bargaining agreement with the NHLPA?

    • Doorey Reply

      November 23, 2012 at 9:53 am

      Howard, your model presumes that the NHL players will agree to play for the owners without a collective agreement. There’s no sign that will happen. There are benefits to players in the collective agreement that they don’t want to give up. The owners could hire other players, but this would then be a low calibre league, since I presume most players would come from lower level pro leagues. That would be a league, but it wouldn’t be the NHL. It would be like a league of replacement players, and few people will pay to see that. Moreover, if there is no collective agreement and no players union, then things like a salary cap, and rules restricting free agent movement, etc., would all be a violation of anti-trust laws, since they involve employers and businesses fixing the terms of competition. The NHL owners could not “agree themselves on a method for attracting players under rules that are mostly in place now.” Many of those rules are illegal collusion and price-fixing outside of the protective legal bubble of labour law statutes, which carve out an exception to anti-trust laws. The NHL owners want rules like a salary cap, and they need the NHLPA for those rules to be lawful.

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