Executive Summary: Key Legal and Evidentiary Issues

• Dispute centered on alleged time theft by unionized employees under a collective agreement.

• Employer sought civil damages for fraudulent wage claims after internal investigation.

• Terminations had already been grieved and upheld under the labour grievance process.

• Defendants challenged the court's jurisdiction, invoking the Labour Relations Code.

• Court applied the Weber test and found the claims arose from the collective agreement.

• Civil action was struck as the dispute fell within exclusive labour tribunal jurisdiction.

Facts of the case

The plaintiff employer, Sunrise Poultry Processors Ltd., operated a poultry processing plant where the defendants were employed in the sanitation department. All defendants were unionized workers under a collective agreement negotiated with United Food and Commercial Workers, Local 1518. In late 2022, Sunrise conducted a private investigation that revealed what it alleged to be a coordinated pattern of "time theft." This involved defendants using each other's swipe cards to falsely represent one another’s presence at work.

On November 20, 2022, Sunrise terminated all defendants. The union grieved the terminations under the collective agreement, but the terminations were upheld. Rather than seeking redress through arbitration, Sunrise filed a civil action in March 2024 to recover wages allegedly paid for time not worked. The claims included misrepresentation, conspiracy, fraud, unjust enrichment, and breach of the employment agreement.

Jurisdictional challenge and legal analysis

The defendants applied to strike the civil action, arguing that the court lacked jurisdiction because the dispute arose from a collective agreement and should be determined exclusively by a labour tribunal under the Labour Relations Code, R.S.B.C. c. 244. The court applied the two-part Weber v. Ontario Hydro test to assess jurisdiction: (1) whether the dispute arose from the collective agreement, and (2) whether it fell within the agreement's ambit.

Justice Ahmad concluded that the dispute concerned employment conditions governed by the collective agreement—specifically remuneration terms and the employer’s management rights. The claims were intertwined with the basis for the defendants’ terminations, already adjudicated through the union grievance procedure. Even if the employer’s civil claims could stand alone at common law, they were still inferentially connected to the collective employment relationship.

The court emphasized that labour tribunals have exclusive jurisdiction where a dispute relates—even indirectly—to a collective agreement. It also rejected the employer’s argument that former employees or employer grievances were not covered by the agreement’s arbitration provisions, noting that such determinations fall within the jurisdiction of the labour board itself.

Decision and outcome

The court ruled that it lacked jurisdiction and struck the civil action in its entirety. Justice Ahmad held that the essential character of the dispute arose from the collective agreement and that the labour tribunal had the exclusive authority to resolve it. Accordingly, the court declared itself without jurisdiction and awarded costs to the defendants. This case reaffirms the principle that disputes stemming from unionized employment relationships must be resolved through the mechanisms set out in collective agreements and under the governance of labour tribunals, not through civil litigation in the courts.