Canada court rules against Wal-Mart over Quebec store closure
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| OTTAWA/TORONTO
Wal-Mart聽Stores Inc violated聽Quebec's labor code when it closed a store in the province that had become one of the first in聽Canada聽to successfully unionize, the聽Supreme Court聽of Canada聽ruled聽on Friday.
The ruling was a rebuke to the world's largest retailer, though its impact on unionization efforts at other聽Quebecand Canadian stores may be limited. The decision took issue with the timing of the 2005 closure, but it did not address the company's right to shut operations.
The court sent the case to an arbitrator to determine appropriate remedies, which will likely include compensation for the 190 workers who lost their jobs when the store, in聽Jonquiere,聽Quebec, closed. The closure came shortly after the United Food and Commercial Workers (UFCW) union was certified to represent the store's workers in 2004.
Wal-Mart聽had said it did not close the store because it was being unionized, pointing to the fact that it had reached a collective agreement with the same union at a store in聽St-Hyacinthe,聽Quebec.
"We are disappointed by the decision,"聽Wal-Mart聽said in an emailed statement. "This was an appeal of a unanimous decision by the聽Quebec Court of Appeal聽to reject the UFCW's claim, which in our view was a legally correct decision."
The company said it was reviewing the decision to determine its next steps.
In 2009, the聽Supreme Court聽backed聽Wal-Mart's right to close the store, but Friday's win came after the union brought a fresh challenge under a different article in the聽Quebec聽Labor Code.
Quebec, a largely French-speaking province, has traditionally been one of the most labor-friendly jurisdictions in聽North America.
Friday's ruling found that聽Wal-Mart聽erred in closing the store during a "freeze" period, which starts when workers file to unionize and ends when they get a contract, go on strike or are locked out.聽Quebec聽law limits employers' ability to change working conditions during the freeze period.
"Once a union has been certified, you have to negotiate," said聽Gilles LeVasseur, a professor and labor expert at the聽University of Ottawa.
LeVasseur said the ruling does not prevent聽Wal-Mart聽from closing unionized stores outside of the freeze period. Financial penalties would not be material to the retail giant, he said, but public relations will be an issue.
"A lot of people in聽Quebec聽will say, are they respecting our actual distinct-society way of seeing labor relations? We have a way of doing things in聽Quebec," he said.
Wal-Mart聽is a formidable competitor in聽Quebec聽and the rest of聽Canada聽and has said it will invest about C$500 million ($467 million) this year to expand in the country.
The United Food and Commercial Workers called the ruling a "historic and positive milestone in protecting workers' rights."
But聽David Doorey, a labor law professor at聽York University聽in聽Toronto, said the decision does not fundamentally alter the dynamic between the retailer and its Canadian workers, given that the unionized workers still lost their jobs.
"That message leaves a chill over all other聽Wal-Mart聽employees who would dare to exercise their legal rights to choose collective bargaining," he said.
The聽Supreme Court聽decision was split 5-2.
In the dissent, Judges聽Marshall Rothstein聽and聽Richard Wagner聽argued that applying the relevant law to a store closure would have "absurd results", blocking a closure during the freeze period but allowing it, for any reason, immediately after that period ends