Archived - Discussion Paper on the Review of Labour Standards in the Canada Labour Code

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III. Smart Compliance

Compliance may be the single most important issue with which the Commission was confronted during the review. Without effective and timely methods to ensure compliance, there is not much point in having labour standards legislation. With reports suggesting that 25% of employers are not in compliance with most of Part III requirements, and that 75% of employers have contravened at least one labour standard, there appears to be a need for more effective compliance mechanisms.

The Commission proposed that the causes of non-compliance, such as outdated labour standards and poorly-written legislation, should be targeted in order to prevent problems; that stakeholders should be educated and engaged; and that clear lines of responsibility for various aspects of the compliance strategy should be drawn. One of the other comments heard repeatedly throughout the review was that someone had to get tough on those who did not comply. Employers who repeatedly violate labour standards, but face few or no sanctions, may have an unfair advantage in business.

In order to target systemic violators and bad actors, there may be a need to revitalize the current compliance strategy and structure.[25] This would include an increased focus on proactive promotion of voluntary compliance and remedies to promote compliance in the future, as well as increased monetary disincentives for employers and increased power to collect wages. It may also involve a reorganization of responsibilities with respect to compliance, although some of those changes can be done administratively without legislative amendment.

1. Voluntary Compliance

Commission Recommendations:
  • There should be a greater focus on proactive techniques for promoting voluntary compliance, including:
    • increasing the resources available for education and information;
    • providing stakeholders with materials, training and advice on Part III and labour standards;
    • inviting sectoral organizations and individual firms to voluntarily commit themselves to comply with Part III and other labour standards by drawing up appropriate codes;
    • broadening the membership of the Labour Program’s Labour Standards Client Consultation Committee to include other stakeholders, including organizations that advise non unionized workers; and
    • creating a small audit unit to design convenient systems for keeping employment-related records and to conduct audits randomly or in response to complaints. (R. 9.1, 9.2, 9.3, 9.4, 9.6, 9.7, 9.10, 9.18)

The Labour Program has already implemented some of these recommendations. It provides information to employees and employers on a number of employment-related issues. It is also in the process of establishing audit teams.

It is possible that the recommended increased outreach functions could be accomplished without a specific legislative mandate. Many of the proactive approaches described have already been addressed in a compliance policy that has been in place since 1985. Nevertheless, grounding them in legislation would emphasize their importance to the compliance process.

Other related federal statutes include provisions that codify proactive compliance. For example:

  • Section 42 of the Employment Equity Act authorizes the Minister to develop and conduct information programs that foster public understanding and recognition of the purpose of the Act. The provision also allows the Minister to publish and disseminate information, issue guidelines, and to provide advice on how to implement employment equity plans in the workplace.
  • Section 27 of the Canadian Human Rights Act empowers the Canadian Human Rights Commission to develop and conduct information programs that foster public understanding and recognition of the Act. The Commission also has the authority to carry out research programs, studies, and publicity campaigns that are tied to advancing human rights and reducing discrimination.
  • Section 6 of the Canadian Centre for Occupational Health and Safety Act allows the Centre to provide advice and information to stakeholders, as well as participate in research activities, publish information and statistics, train personnel in the field of occupational safety, and sponsor and support public meetings.

Introducing a similar statutory mandate could entrench the educational role of the Labour Program, and may be effective in highlighting the important role of education and information in the pursuit of voluntary compliance.

For discussion:
  • Would it be helpful to codify the inclusion of proactive compliance measures? Or should such measures be introduced as part of an amended compliance policy, rather than in Part III itself?
  • Will such voluntary compliance measures be measurably beneficial to the stakeholders, particularly employees?

2. A New Compliance Structure

Commission Recommendations:
  • A Chief Compliance Officer should be appointed with the authority to deploy inspectors and other field staff, obtain legal advice and representation as required, order audits and investigations, secure statistical and other analyses of issues related to compliance, and conduct educational and informational campaigns. The Labour Program Inspectorate should be expanded, its procedures modernized and its powers enlarged. The Inspectorate should be strategically deployed under the overall direction of a Chief Compliance Officer.
  • The Labour Program should develop a strong in-house statistical and analytical capacity that will assist the Chief Compliance Officer in strategic planning as well as operational decision-making.
  • A small audit unit should be established under the direction of the Chief Compliance Officer to design convenient systems for keeping employment-related records and conduct audits randomly, as part of a proactive enforcement strategy, or in response to complaints.
  • The Labour Program should assemble a small legal staff mandated to perform the advocacy, negotiating and advice-giving functions required under the compliance strategy. (R. 9.8, 9.9, 9.10, 9.11, 9.12, 9.19)

The Labour Program has already acted upon these recommendations, recently creating the position of Director General of the Compliance and Regional Operations Directorate to whom the Regional Directors report, and who is the central officer and the architect of any strategies to increase compliance. Staff is in place to support the mandate of the Director General, including a small audit unit.

The creation of this new compliance staff group does not necessarily require changes to the Part III legislation. However, statutory recognition of the role of the Director General may underscore the importance of the role and of compliance in general. On the other hand, statutory recognition of any one position may create inflexibilities in the future should organizational change become necessary.

For discussion:
  • Should the position of Director General of the Compliance and Regional Operations Directorate be entrenched in Part III legislation or regulations?
  • Would the possibility of random workplace audits be a sufficient proactive measure to ensure compliance?

[25] Further information about the current compliance system is available on the Labour Program website.

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Date Modified:
2012-02-15